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Technology Stocks : LAST MILE TECHNOLOGIES - Let's Discuss Them Here
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To: Frank A. Coluccio who wrote (2900)2/18/1999 12:54:00 PM
From: Geof Hollingsworth  Read Replies (2) of 12823
 
Hi Frank,

I see what you mean about chief stupidist-one hardly knows where to begin. The biggest issue in FTTH remains cost, IMHO, and the figures in the article are so far from reality they call the rest of his statements into serious question (to propose not only Fiber but DWDM to the home, at a time when people like Chorum are having a hard time bringing DWDM into the metro area because of cost...). The article seems to ignore the fact that fiber termination costs are several times the cost of terminating either twisted pair or coax, and I don't see that changing any time soon (classic catch 22-without volume, unit costs won't fall, but without much lower costs, volume won't be there). If you are looking for a third access technology, I think wireless has a far better shot, particularly if they can use the same parts going into the next generation of cable modems (eg the Broadcom chipsets)and as a result take advantage of that cost curve. Again, the main concern is the cost of the CPE-it needs to be in the $300 range at CompUSA, which means the bill of materials can't be more than about 27 cents.

As to your point that AOL and the non-ATHM ISPs should build a 3rd network, for the sake of their shareholders I hope not. I think that as broadband access in the home setting arrives, the premium on content will be even greater and the value of access will be decreased. Sooner or later investors will concentrate on the cash flow not being generated by the ISPs who lack the ability to get paid for proprietary content.
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