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To: KW Wingman who wrote (14548)	8/15/1999 3:19:00 PM
From: Frank A. Coluccio	Read Replies (1) \| Respond to of 29970

KW Wingman, "You do not continue to depreciate a worthless item, you expense it in the current tax year." Agreed, in principle, however the magnitude of the write off in this case would probably be too high to publicly admit in a single press release. Secondly, the worthlessness of the previous design cannot easily be substantiated on the basis of present performance of the network. Instead, it can only be projected to be worthless at some point in time, soon, betting that the bandwidth curve progresses in some predictable manner to where it would be less worthy of the challenge within so many months or years. But even here there is a great deal of subjectivity involved, with the outcome predicated to some extent on the use policies that will be supported, and where ATHM takes such issues as streaming data, work at home, and how far T wants to make its fiber extensible into local loop areas that transcend generic Internet access. Be that as it may, your observation holds a good deal of merit. But again, it's a strategic call at this point as to whether or not T/TCI and the other MSOs are willing to own up to their 'apparent' shortsightedness which has rendered them potential victims of a the great tsunami of 2000-2001. Or, stated another way, the consequences associated with "here's what we got now, and there was no way to know what was coming with the tide," which is also allowable to some extent... ...because insufficient evidence existed four to seven years ago for anyone to be able to reliably predict the current bandwidth curve in terms that could justify the more expensive builds at that time, in a prudent manner. Having said that, however, I think that the curves have already proven their predictive worth. And I would argue that they understate where demand will be just two years from now. It's time that we gave those curves more respect, and even allowed them a measure of head room. And perhaps you are right, maybe those "older" builds of this year [let's face it, what we are talking about being replaced is still being put in as we type], last year and the year before will be written off. We're in a tornado right now, and it's difficult if not impossible to predict where all the pieces will fall to Earth at this point, given the subjective factors by those in power to make some crucial strategic decisions. Regards, Frank Coluccio