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Technology Stocks : Harmonic Lightwaves (HLIT) -- Ignore unavailable to you. Want to Upgrade?

To: Moose who wrote (3115)	11/20/1999 8:31:00 AM
From: JEFF K	Read Replies (1) \| Respond to of 4134

Good for Divi now good for HLIT US Senate Approves Satellite TV Legislation Washington, Nov. 19 (Bloomberg) -- The U.S. Senate gave final approval to legislation that will allow satellite television companies such as Hughes Electronics Corp.'s DirecTV to carry local TV signals for the first time. The lack of local programming is the biggest reason that consumers choose cable television over satellite TV, the satellite industry has said. Cable TV companies dominate 82 percent of the market for home subscription TV service today, and lifting the local restriction will help chip away that edge. ``This is the most important reform in helping satellite compete with cable,' said Senator Patrick Leahy, a Vermont Democrat and co-sponsor of the measure. ``Consumers are clamoring for this service.' The legislation was attached to the federal budget bill approved by the Senate tonight and by the House yesterday. It will now go to President Bill Clinton for his signature. DirecTV and EchoStar Communications Corp., which operates the DISH network, immediately will be able to begin offering local TV signals, though they'll have to negotiate compensation arrangements with the stations within six months. At the end of six months, the satellite companies will face stiff penalties if no agreement has been reached and they're carrying the signals. The companies are likely to see an increase in subscribers in 2000 as a result, analysts said. ``We know that 2.25 million customers get both cable and satellite, and the reason why they keep their cable, we think, is to keep their local channels,' said Thomas Eagan, an analyst with PaineWebber Inc. ``Certainly there are a lot more people out there that would get satellite if they could get local signals.' All-Station Requirement By 2002, the satellite companies will have to carry every local TV station in the markets where they provide the service, not just the most popular network-affiliated stations. Satellite companies lack the capacity to carry station in every market, so DirecTV and EchoStar plan to offer the local programming in the top 50 or 60 markets. DirecTV is likely to benefit more from the local-into-local legislation than EchoStar because it's more aggressive in the major markets, analysts said. ``We think the impact will be pretty immediate,' said Steve Cox, senior vice president of new ventures at DirecTV. EchoStar argues that the six-month requirement to negotiate retransmission agreements with broadcasters and the stiff penalties give DirecTV greater leverage because it has more than 7.7 million subscribers compared with EchoStar's 3.1 million. ``DirecTV also has better relationships with broadcasters and twice as many subscribers as EchoStar,' said Armand Musey, an analyst with Banc of America Securities. In a statement, EchoStar Chairman Charles Ergen said the legislation falls short in some ways. ``With no statutory guarantee of fair pricing, the best we can do is hope that broadcasters will not demand terms and prices from us that are higher than cable pays.' Rural Loans Removed Because the satellite companies won't serve rural markets to start, legislators from rural areas tried to add a provision during negotiations that would have created a $1.25 billion rural loan guarantee program. Senate Banking Committee Chairman Phil Gramm, angered by effort to add the loan program, nearly derailed the legislation by threatening to block a vote on the floor. He argued that the hastily crafted measure was a billion-dollar corporate giveaway and his committee should have jurisdiction over the issue. Late Wednesday night, a compromise was reached to strip out the loan guarantees with the understanding that Gramm's committee would address the issue no later than April 1. The measure includes other provisions to help satellite companies compete with cable. For instance, it eliminates a requirement that cable subscribers who want to sign up for satellite TV must wait 90 days after canceling their cable service. It also slashes by 45 percent the fees that satellite companies pay for the right to air network signals from far-away cities. Finally, the legislation allows satellite TV customers who had been illegally receiving TV signals from distant markets to continue receiving that service for five years. A court last year ordered the signals shut off. Nov/19/1999 20:42 For more stories from Bloomberg News, click here. (C) Copyright 1999 Bloomberg L.P.

To: Moose who wrote (3115)	11/23/1999 7:59:00 AM
From: J Fieb	Read Replies (1) \| Respond to of 4134

Moose, Here is an interview with someone who should know what he is talking about........... from Bussiness week No, Virginia, the Net Is Not Going to Make Everything Simple Arno Penzias sees a multiplicity of e-devices in which ``no one size fits all' After 36 years at Bell Laboratories, including three years as director of the legendary research center, Nobel laureate Arno A. Penzias has retired in California. There, he serves as an adviser and investor with blue-blood venture capitalist firm New Enterprise Associates, offering his insights into telecommunications and other technologies. Dressed in a red sweatsuit in his San Francisco home, Penzias shared some of those insights with BUSINESS WEEK's Andy Reinhardt, while cargo ships plied the bay outside his picture windows. Q: Why did you leave Bell Labs? A: I had changed everybody's job except mine. So I decided to change, and right at that point, I began to see all these little companies doing interesting things out here. The work we did at Bell Labs had set the stage for all this wonderful stuff. So I came out here, initially with Lucent (LU), and started working with small companies. Now I'm on my own and working with New Enterprise Associates. Q: What's your vision of how the communications system is being transformed today? A: There is going to be intelligence everywhere in the network, but there will be considerably more control at the edge than there is now. Q: What is the difference between intelligence and control? A: Intelligence is what allows a function to be carried out. Control is where the choice is made to use the function. There are big religious arguments about this. But the trend is undeniable. It's like the Internet--where users have control--compared to the old phone system, which was completely centralized. This is a growing theme throughout our whole society, and not just in the communications sector. Q: Tell me more about decentralization. A: Back in the industrial age, the image of progress was Pittsburgh, with its huge stone chimneys belching smoke. Now it's small offices and home offices. People can carry their laptops everywhere, and those are their offices. The poster child of American prosperity today is somebody with a laptop getting on an airplane. For a telecom company like Lucent or Bell South (BLS), what that means is that their job is moving from the central telephone office to the customer premises. They're in the best position to take care of networking stuff in the home anyway. After all, they make house calls; they're the people who come and make your phone work. Maintaining things like home networks will become the locus of tomorrow's communications companies. If the local telephone companies ever become well-managed, they could be really dangerous [laughs]. Q: What will the network of the future look like? A: There will be copper and there will be fiber, there will be fixed radio and mobile and satellite, and each one will fill its own niche. On top of these there will be a variety of protocols. No one size fits all. There will be a lot of complexity, and your machines will attach to whatever is out there. You will see the emergence of things like bandwidth-on-demand, where you can share a pipe and get the bandwidth you need. But Internet Protocol [the software lingua franca of the Net] isn't going to solve every problem. Not all of this stuff is going to be handled by a single goddamn Internet Protocol network. Q: Who said it would be? A: Well, John Chambers [CEO of Cisco Systems (CSCO)] says the telephone is a dinosaur. He's a great man, but his mentality is that you should get rid of your phone and use your computer instead. Give me a break. The telephone is convenient, it works, it goes in your pocket. The mistake he's making is to think that the world is going to be a neater place, that Internet Protocol will do everything. I think it'll be quite the opposite. Things are getting more diverse. Q: Can you give me some examples of that? A: You are going to see other protocols for things like channelized data, where you want your own pipe or you need more security. And you are going to see a multiplicity of devices, not a blurring. You don't want to watch video on your cell phone. Within five years, every new car in the world will have a satellite antenna that lets it receive 500 radio stations and six to eight hours of storage for saving programs. And think what your life will be like when a TiVo box [a digital video recorder] will be able to store 3,000 hours of video instead of 30. All of these different devices will use various kinds of networking technology. : So what is the hottest area you are looking at now? A: I'd say metropolitan area networking. There are lots of companies making gigabit Ethernet equipment, and on the other side, outfits like Global Crossing (GBLX) and Qwest (QWST) that have huge data pipes. But people don't understand that these two worlds don't connect very well today. It's the part of the python where the pig is stuck. So I'm looking at a portfolio of companies that are taking a fresh look at how to weave together these two worlds. Companies like Mayan Networks, LuxN, Astral Point, and Quantum Bridge. They're throwing electronics at the problem, collapsing everything together to improve the connection between local area networks and the backbone. FUture competition for HLIT? Anyone know anything about these companies? Q: What's the biggest trend you see overall in the computer business? A: The move from products to services. The only way people are going to be able to make money is on the service side. The margins in the PC business are gone; there's no value in stuffing boards. Even Michael Dell could finally work himself out of a job. He makes only $200 off a computer that costs its buyer $20,000 in service and support over the life of the machine. He has to find a way to grab the other 99% of the value of each machine his company sells. You have to keep reinventing yourself. Q: Are there any other technical trends people aren't aware of yet? A: There is tremendous stuff going on with electronic displays. Right now, display panels cost around $1,000. But people are figuring out how to make them as thin and flexible as a plastic vegetable bag. Imagine what that will mean. You will be able to hang them on your walls just like posters. Displays will be so cheap that packages will have their own displays. Q: What's the biggest difference that you've noticed between the East and West Coast high tech businesses? A: There is a tremendous amount of diversity here. But probably the most important difference is in the work style. People out here are less worried about failure than they are back East. Even the venture capitalists are different: They use the same words, but they tend to be more conservative in the East. I saw that when I came out to learn about startups for Lucent. When you are farther away, it's easier to deny what's happening here. But there is a tremendous amount going on.