You say in one breath that ATHM lost its technical advantage by the distraction of TCI working on digital TV
No, not by, when. Hindery stated eight months ago that TCI blundered when they emphasized debt paydown and digital tv channel expansion over Internet upgrade. He reiterated that about 3 months ago. What has happened is that the time wasted has been used by the prospective competitors and by infrastructure companies actively developing alternatives to last year's cutting edge. You can certainly squander the technological lead, but that is different than casting your pearls before swine in your haste to compensate for previous errors in judgement. While TCI fiddled, ATHM burned. They burned the tech lead, that is. Now others can build similar facilities and the redundant architecture though still good has cracks exposed by the growth of load. The cutting edge improvements and new facilities always have advantages. Since ATHM pioneered the concept they still are rolling around in a covered wagon.
and that @home should move gradually and not focus on total domination.
An attempt at total domination mostly fails and often loses everything.
All TCI did was slow rollout into TCI territory.
Really? Wasn't the SF Bay Area upgraded last fall? Oh, I agree. They slowed it down so they wouldn't shoot themselves in the foot. Why is it then that management and analysts are putting so much emphasis on rapid growth in subscriber numbers?
I dont see how this translates as a loss of technical advantage,
Because it is cheaper and easier for competitors to build what ATHM has. The cost of entry is lower. We like competition but we don't want to go out of our way to help competitors. We believe they are completely capable to help themselves. This is called respect.
You say that @home needs to focus on the cash generation from subscription revenues and that other sources of revenue are suspect.
No. you said that. I said that ATHM can't neglect the importance of subscriptions because the surety of return which is actuarial is enhanced by stable cash flow. The MSOs depend on those flows and their stability to do debt service and to secure possible new extensions. The guarantee of regular payment may be the most powerful assurance in finance.
Yet you also said once that by simple calculations ATHM valued without its future prospects is a $60 stock.
I said that the best estimate I could make was that in 2 years ATHM could have 2M subscriptions and earn $2.00. I assigned at 50 PE and so that meant the stock was fairly valued at $100. I further added that in a bad market it wouldn't be surprising to see it drop to $60 because rational expectations which are extreme often go to downside extremes too, since there isn't fiducial justification for 1000 PEs. The thread in an attempt to belittle me jumped on the the $60 price.
If for some reason the FED had to raise rates rapidly, the stock market would crash, open down 3000 points, and by the time you got off an order, ATHM would be worth 10. Further, it would have a hard time holding that level. Fortunately, that can't happen because we know what the FED can't do, don't we?
A few months back I wondered what would happen if the @home coalition did not hold together. You told me I did not understand, why would it come apart?
It hasn't come apart yet although the tunnel is open. So why would it? Why should Comcast jump? They must think they can do better on their own. That's all the substance you need. I've known about the dissension among the cable partners and have mentioned it plenty here, but then there was no apparent reason for Comcast to make this bold move. What changed the lay of the land was the FCC frozen decision. You'll find that I made that comment to you before the FCC decision. I suggested back then to several thread participants in PMs that they should buy UMG based in part on the point that Comcast had insufficient reason to jump, but with that FCC decision, the hegemony potential of T was too great of an incentive.
Now you say it is inherent in the nature of the universe itself for coalitions to blow apart.
I wouldn't say that in those words, but now that you said it, I quite agree. I agree with Yeats.
What does being under the control of Time-Warner have as an advantage to being under the control of AT&T?
I was right; you don't understand. How could you not? You read the ownership list. How is Comcast under TWX control? Glued by the exchange of color electric charge to the T quark dominated multiplet Comcast is mediated by strong arms. Free, they are like Liebnitz' monads. You are saying something like ATHM is under the control of Castel. Oh come now.
What in your vision is the value added of @home? In what way are they special that matters?
Before you came on this thread I spent 1,000,000 words explaining that over many sneering objections. Practically none of them are still around. |
