<<ASND could not have made it to the next level on its own and had to be acquired. The same will happen with MRVC (my opinion). The time and cost involved to compete with a CSCO or LU, as CSCO and LU acquire or develop new products will be too prohibitive.>>
Well I almost agree with you. ASND was on the cusp of being a large long-term player in it's own right. They had reached about $1.5 billion in sales and had just acquired a whole bunch of long term carrier contracts. ASND could have continued at least another year or 2 independently and possibly survived indefinitely through acquisitions of their own.
They would have given LU fits in the near term, if LU had not bought them when they did, so I see the buyout as benefiting LU more than ASND being in any real need.
I agree with you that MRVC will also ultimately be acquired. But, unlike others, I don't think they NEED to be acquired any time real soon - and certainly not anywhere near these ridiculous price levels.
You talk of the "next level". Well there are many levels. For MRVC with their new products, I can easily see them reaching $1 Billion in annual sales on their own in the next 2 years. It's the level after that that will be hard to breach.
<< We'll have your stair steps, especially as this market is expanding
(although the stock market has some risk in the short term) but I don't see MRVC being able to compete on CSCO and or LU's level over a long period of time.>>
The key to your statement is "over a long period of time". I agree with you in that respect. But CSCO and MRVC are in different target markets right now for many of their products (thats hard to believe, but true - let me explain).
At the moment, CSCO has no Terabit class router (oh they just bought someone, but it will be a while). They are not in the Metro DWDM market. And their DWDM and Optical networking is only via partnership with CIEN, I think. CSCO has no Lightwave product component either, selling to the networking, cable and FTTC markets - in fact they are a MRVC customer for those products.
Long term, CSCO will be in all those markets (perhaps via MRVC?), but right now they are not. I think MRVC has a good couple of years to continue growing and delivering their products before the "next" level becomes a must. |
