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Technology Stocks : WAVX Anyone? -- Ignore unavailable to you. Want to Upgrade?

To: SDR-SI who wrote (7698)	7/3/1999 5:27:00 PM
From: Marty Lee	Respond to of 11417

An Interview With Thomas E. Claugus Right Steven... Tommy is but another ballast from the past with eyes poorly focused on the less-than-luminous vision in his rearview mirror. Prepaid-for-N-abled access to on-line content won't work with Joe Six-Pack? Non-sense! Debbie Does Dallas disagrees... Average Joes prepay their local TCI cable operator. They prepay for their newspapers and several subscriptions to magazines galore. Media moguls intend to transfer Joe's habit to his on-line puter... Wave Systems business model does not compete with other information distribution and commerce models. Rather, it supplements, enhances, and makes possible new levels of unparalleled sophistication for the established media as it dictates that control will devolve from centralized computer architectures into distributed systems. This will allow Joe Six-Pack the most convenient, economical, and option-filled way to acquire entertainment and educational content on demand. Sincerely, Marty

To: SDR-SI who wrote (7698)	7/3/1999 6:12:00 PM
From: ecommerceman	Respond to of 11417

I couldn't be happier with this debate--finally, a chance to test our assumptions with some intelligent skeptics! I read the Barron's references carefully, and was fully prepared to pull the trigger on Tuesday if I became convinced that the skeptics were right; much as I enjoy the WAVX community, I'm not going to risk losing tens of thousands of dollars if our assumptions are wrong. But I don't think we're wrong. The crux of Claugus position is his skepticism that "Computer manufacturers must first accept this e-commerce solution and install it on a sufficiently large customer base." Absolutely and indisputedly true, and chilling until one realizes that they have every reason to do so. Even the casual observer knows that computer manufacturer margins are being squeezed hard, and that they are desperately searching for other sources of revenue. Do they make a penny from Visa e-commerce transactions run through their computers? Of course not. Is an Visa card/OEM revenue model possible? Not that I can think of. So is it in the interest of OEM's to deploy our chip? Clearly. Back to Claugus: "Content providers must view this as a viable way to be paid and modify their product offerings. Content providers must also be willing to give up 50% of the revenues of the transaction just to transact." Yup, and they'll be happy to do so if by so doing it leads to sufficient volume of sales. Digital content is different than building cars--it costs no more to sell the millionth item of digital content than it does to sell the first item. If the Wavemeter is widely deployed, and again it is in the OEM's interest to deploy it, then content providers would be idiots not to sign up with Wave. In fact, if/when Wave is widely deployed, content providers will be calling them to do just that! Back to Claugus: "Finally, consumers must be willing to send money to an unknown company like Wave Systems to deposit in the "cash register" on his PC and must be willing to keep that money there until he transacts. All of these steps seem highly unlikely to us. Okay, if Joe Consumer has a computer with a Wavemeter installed, and if he can make micro-transactions to rent (and finally purchase if he chooses) software and/or entertainment of all kinds, and do so with full security, why in the hell wouldn't he? And as for his willingness to keep the money in the chip until he transacts, it's worth pointing out that he is the arbiter of the amount of money he wants to add to the chip. If he wants to put twenty bucks on the chip, then that's what he'll do. No one has a gun to his head; it's always his choice. Admittedly, we're still in the chicken/egg situation. We're not widely deployed yet, but content providers are continuing to sign up, and the chips that have been deployed work just fine. Once an OEM announces deployment, content providers will come on board in greater numbers. Once more content providers come on board, then other OEMs will follow, and will do so gleefully, believe me. And, uh, one other thing, Mr. Claugus: once Wave is widely deployed, you needn't worry about the company remaining unknown; we'll be on the cover of Barrons, not just in a few paragraphs inside. And, if you're still short when the first OEM announces, then God help you...