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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: DownSouth who wrote (14008)	1/3/2000 5:59:00 PM
From: ggamer	Respond to of 54805

etrade.com Daily Stock Brief by Briefing.com Updated: 02-Jan-00 Six Trends in Technology for 2000 [BRIEFING.COM - Robert V. Green] As the New Year starts, here are some thoughts on what the major trends will be, for technology investors, in the coming year. 1: Wireless Broadband The wireless broadband group will finally exit the development stage and become more prominently available. The market will help decide which of the wireless broadband applications will be the most successful. It may be that wireless will replace the local loop, replace the local area network, or become centralized through satellites. In addition, it will become clearer whether licensed or unlicensed spectrum is more valuable, as the market makes choices among the various technology trade-offs of each spectrum. Implication for investors: Find the right wireless broadband play, both at equipment level, and service provider level. 2: Single Source Telecom Providers In the commercial and the consumer space, the trend toward a single source provider of local and long distance telephone and internet data service will intensify. Particularly for business customers, the economics of providing the services will make bundled services cheaper than unbundled provision by separate vendors. This will lead to consolidation among telecom and data providers, possibly including owners of fiber optic networks. Implication for investors: Determine who the largest provider of bundled services will be, then figure out which smaller companies they will acquire. 3: Video Internet The next era of the internet will begin to come into focus. The current internet, textually oriented and delivered through a PC, will continue to grow. However, explosive growth will be most available, to investors, in new providers of technology and/or content for broadband visually based internet applications. The next era of the internet will be closer to "the TV meets the internet" than "the PC meets video." Implication for investors: 1) If you are a holder of internet stock , verify how your company will transition into the next era. 2) Find out who the next AOL and Yahoo are for the next era. (They may be AOL and Yahoo.) 4: Application Service Providers The concept of providing software services on a leased or transactional basis will be rolled out in a much larger way than it has been so far. Although the ASP concept has received a lot of media attention, there still is not true proof-of-concept that enterprise America wants to outsource key enterprise functions. Nevertheless existing major players and new venture-backed companies alike will test the waters. Implication for investors: Look for the early provider who shows true proof-of-concept. 5: The Great Sifting The "great sifting" of internet companies will continue. We use this term to refer the market's judgment on internet companies that haven't made it to a profitable, sustainable leveraged business model. This process started in 1999 and will intensify in 2000, particularly for textually oriented internet content companies. Patience, based on the idea that the internet will eventually be so huge that any level of operating loss was worth it, will weaken. This will be accelerated as the visually oriented internet becomes clearer. 6: Rolling Thunder Correction The widely expected correction in technical stocks may not be a traditional correction. Although many, including many analysts at Briefing.com, believe a correction is likely in 2000, this author believes a "rolling thunder" style of correction may occur. We have already seen in 1999 how capital migrated from traditional stocks of all kinds into technology stocks. This migration left desolation in its wake, and sent a selection of stocks into unprecedented valuations. In a traditional correction, all stocks, good and bad, suffer. In a rolling thunder correction, the migration of capital would collapse many of the current high flying stocks, but move into new tech stocks, rather than exit the market. For holders of the current winners, it will be a bear market just the same. But for the investor who is nimble enough to follow the wave, a rolling thunder correction could provide even more of the amazing returns of 1999. But the risks will be higher than they have ever been. Should Be Fun The one certain prediction for the year 2000 is that it won't be dull. After the monumental year for tech stocks, it is certain to be exciting, one way or the other. At Briefing.com, we will be researching all of the above trends, and talking about specific stocks that will be affected, over the coming weeks. Comment may be emailed to the author: Robert V. Green at rvgreen@briefing.com.