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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: zbyslaw owczarczyk who wrote (12021)	6/24/1999 1:37:00 PM
From: pat mudge	Respond to of 18016

From today's IBD. Note the first technology mentioned and at the end, what they say about leading ideas seen at SuperComm. Their comments regarding LU may take the "Skillet Calling the Kettle Black" award of the year. >>> Cisco Systems Inc. wants to build an ecosystem that supports many life forms. But instead of regular rainfall and a good food supply, the networking gear leader's ecosystem needs something else to flourish: open standards that ensure competitors' products work together. Open standards will help Cisco compete against Lucent Technologies Inc. and Nortel Networks Corp. as the industry moves away from proprietary voice gear, says Don Listwin, Cisco's executive vice president in charge of Internet-related products. The move is to packet-based gear, which divides voice or data traffic into standard packets for easy transmission. Listwin recently spoke with Investor's Business Daily about Cisco's plans for stocking its ecosystem. IBD: How is Cisco's Internet strategy changing this year? Listwin: We think that the fundamental change for the expansion of the strategy is to build our ecosystem and to make it much stronger for these new world networks. At SuperComm '99 (a recent communications gear trade show), we announced a new joint venture with Motorola Inc. on wireless technology and our building standards out of that where other people can participate. It's how we're expanding our reach into the market ecosystem. We also announced new Internet networking management products for the telecommunications industry built around an open-standards platform from Cisco, KPMG Peat Marwick and Hewlett-Packard. Then we announced another 100 partners that are building around the voice-over-Internet Protocol ecosystem to do full solutions for that. If we eat our own dog food in terms of this Internet model, externally we have to get more and more people participating in our overall value proposition. I would say that's the key focus for us. IBD: How are you achieving that? Listwin: By creating structures that at a technology level have open interfaces and are built on open standards people can add value to. Let's say that a cable company wants to do voice technology over cable now. We build that in an open-standards way. So now (another company) can finish it. The notion of building technologies around open standards is one of the big ideas of how we get more people participating in solving customers' problems. IBD: When do you think sales for telecom gear based on traditional circuit technology will slow? Listwin: At an industry level, they have flattened out. We have AT&T saying, ''We're not buying any more class-four switches (heavy-duty telecom gear to route phone calls).'' We've seen industries like the cable industry saying, ''We're not buying Sonet (an older optical technology).'' I think the gap between the winners and losers is widening. For the European players, in particular, the trough is faster than we expected. For North American players that are expanding, the trough is (coming) slower than we expected. IBD: Who will win or lose? Listwin: The market view is as follows: Alcatel, Siemens and NEC are losers. Nokia and Ericsson are to be determined because of their strength in wireless. I would say that Nokia, Ericsson and Nortel are to be determined. Cisco and Lucent probably are going to be winners. IBD: Lucent is finalizing its $20 billion buy of Ascend Communications Inc. on June 28. How do you think the combined company will affect Cisco? Listwin: We always are wary. Ascend has good technology. Lucent's a major player. My personal observation (walking into) the Ascend booth at SuperComm (was that) I couldn't find anyone I knew, and I know a lot of people from Ascend. The observation of what's critical is not the here and now of the technology, but what's next and who's going to do it. All of the indicators I look at, having done 34 acquisitions myself, are what we would expect of a large, bi-coastal, bad-cultural- fit acquisition. Am I concerned about it? Absolutely. That's what I get paid for. Do I think they're on the track that we expect? Yes, I do. You've got to stay up nights about it, but this industry is not about what you've got now. It's about what you've got next. I didn't see the intellectual leadership in the Ascend booth that used to be there.

To: zbyslaw owczarczyk who wrote (12021)	6/24/1999 5:05:00 PM
From: Ian@SI	Read Replies (2) \| Respond to of 18016

Z.O., Re the $1B LMDS: I believe the numbers were: Year Sales Growth (YoY) 1999 100M infinite 2000 300M 200% 2001 600M 100% I would further note that Broadband Wireless will be 50% more than ATM WAN is today. ATM WAN has been growing at 30% + a quarter for the past 2 quarters; and this is before LMDS enters the picture in any substantial way. TEM will remain flat in the 120-165M range. So if we add in ATM WAN at 50% YoY growth from the current run rate of 1.6B annually, we get: LMDS LMDS ATM TDM Year Sales Growth (YoY) WAN Sales Total 1999 100M infinite 1600M 140M 1.8B 2000 300M 200% 2400M 140M 2.9B 2001 600M 100% 3600M 140M 4.3B What do you think a price might be for NN with revenues of somewhere between $4 and 4.5B in 2001? Just doodling, Ian.