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Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: MikeM54321 who wrote (5106)	3/22/2000 10:11:00 PM
From: Gregory Rasp	Respond to of 14638

I am not accusing you of saying this, but I have seen several posts in the CSCO thread that insinuate NT has been sort of going overboard with spending on these companies. The reason I am responding to you is that the purchase prices of both CSCO's and NT's purchases are included in your post. Cerent + Monterey + Pirelli = $9.55B Qtera + XROS + Coretek = $7.93B NT's purchases were separate announcements and more recent but otherwise it appears that they both are pursuing an aggressive buying spree. GR PS. Big optical spending is going on Now. The author is just pointing out that the REALLY big spending is still coming. You only need to look at Corning's recent announcement to know that optical is driving earnings in a big way.

To: MikeM54321 who wrote (5106)	3/22/2000 10:53:00 PM
From: Bosco	Respond to of 14638

<edited>Hi Mike - in a way, your concern is valid, in the sense that when and if too much resource is spent in a limited area. The question is: is it too much? However, in addition to what Greg has pointed out - my take is that NT buying Qtera, Xros and CoreTek at ~$9B with some non monetary currency is a bargain, [btw, usually with a performance clause inserted] - according to Yankee Grp, Message 13258202 it is a $50B market in 4 years. But let's face it, my suspicion is that no one has the foggiest :)! A few years ago, the net is still a curiosity [and I kicked myself of thinking Yahoo! was just a fad] One thing some of us may agree is that: no matter what may be the composition of the edge, the core will be optical. I would go so far as to suggest that this applies to the developing countries just the same. I certainly hope Mr Roth & co know what they are doing. However, my guess is that we have to take them at their face values. My guess is that Mr Roth, or any CEO for that matter, is not going to tell everything to the general public. Trade secrets cannot be trade secrets if everyone knows about them :). On a separate note, the concern voiced here about NT balance sheet is obviously valid also, especially when that compares to CSCO debt free balance sheet. However, I would think CSCO and MSFT are exception to the rules. GM, GE etc do sell commercial papers now and then. Please don't get me wrong, shareholders like you and me definitely prefer a pristine balance sheet with no long term debt and the growth rates are like rabbits in heat :)! I think NT will eventually produce strong free cash flow once she has completed assembling her different pieces. There is life beyond optical. For instance, her thrust into ASP should generate a steady stream of revenues when fully deployed best, Bosco