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Technology Stocks : PSIX up 26.5%, Takeover(?) -- Ignore unavailable to you. Want to Upgrade?

To: telecomguy who wrote (4634)	8/3/1999 8:36:00 AM
From: David N. Kunkel	Read Replies (2) \| Respond to of 5650

Telecomguy, While I'm happy to see you back, I'm not sure what your purpose is. You admit having sold PSIX a long time ago, around 35, if I recall. Now, you are questioning our business model; but you are ignoring some salient facts. The main point you make is that we are showing gross margin improvement due to migrating leased bandwidth expense off, and shifting to owned bandwidth. Fair enough. That's what is supposed to happen; it's why we've bought bandwidth, and pay per unit between one tenth and one one-hundredth of leased bandwidth cost. What you are not addressing is the fact that we are continuing to grow the network and our global presence, significantly. That's why the D&A continue to increase. If we stopped growing, just did what we do on our current network, becoming profitable in the short term would be easier. But, as I've posted many times in the past, we're continuing to go for global market share. In the meantime, our business model does make sense, and has proven out. Our UK business is profitable; our whole Asia/Pacific group are significantly EBITDA positive (without a lot of owned-bandwidth benefit), and so on. So, I don't agree with your assumptions, nor your seeming expectations of where we're going. Nor, why we should stay in business just to be bought out. Regards, David Kunkel