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Technology Stocks : I-Link Inc (ILNK), VoIP Telephony -- Ignore unavailable to you. Want to Upgrade?

To: Paul K who wrote (379)	4/24/2000 11:07:00 PM
From: Paul K	Read Replies (1) \| Respond to of 417

ILNK: The Importance of Disruptive Technology and Lower Prices(4) by: Glotech (49/M) 4/24/00 5:58 am Msg: 26974 of 27072 Keep in mind that a disruptive technology doesn't necessarily mean high-tech. But it does mean lower prices and eventually a better product. Some of the examples of disruptive technology are: 1. Ford, made the Model T in just one color-black-but he made it the cheapest and most reliable car in the world. His assembly line and single color design was a disruptive technology-and he cut his prices by 30% and doubled the salaries of his workers in the same year! Having lower prices enabled him to afford loyal and competent employees-part of the formula that helped Ford and his early investors become some of the richest people in the early 1900s. 2. Nucor, very profitable American Steel company with a highly disruptive technology in the dull and mostly up-profitable industry. If you're like most Americans, you probably think of American Steel companies as being some of the least attractive investments of all time. And you are right. For example, if you'd bought Bethlehem Steel anytime in the last 30 years, you made nothing. No return on your investment. Zip. But investors of Nucor have made tons of money, because of its disruptive technology for "continuous thin-slab casting". I won't bother you with the specifics, but it's a way for "scrap" steel to be continuously cast from a molten state into long, thin slabs of high quality steel-the kind of stuff used in cars and refrigerators. Like all disruptive technologies, this method doesn't produce a product of the same quality as integrated steel sheet. In fact, there's not an integrated steel mill in the world today that has adopted this technology. But Nucor doesn't care. They are making steel that is "almost" as good, at half the price. Meanwhile, they are constantly increasing the quality of their steel and continue to capture more and more of the market. Nucor stock is up by 850% in the last eight years, ever since they rolled out their new technology. 3. Dell Computers, has basically destroyed Compaq's core business of retailing microcomputers by using a very disruptive business model. By direct selling to consumers and businesses, via the phone and the Internet, Dell has become a classic hyper-growth company. Dell's shareholders have cashed in with the stock that is up 3900% in just five years! The market continues to maintain a healthy "suspicion" of Dell-Wall Street hates the stock. But Dell is continuing to cut prices? and it's following a hyper-growth strategy with direct sales business model. 4. Amazon.com, is perhaps the most controversial stock picks that has made lots of its investors very rich with a 6,900% profit in just three years. Amazon.com is using the disruptive technology of the Internet to under-price its competitors by selling books at a 40% discount, while offering in many ways what is a superior product: it's easier to buy a book from Amazon.com than it is from your local retailer. In fact you can purchase a book from Amazon.com in less than 30 seconds and there is no sales tax. If you look at Amazon's competition, they are reacting in the classic, confirming fashion: they are running up and largely ignoring the Internet. Border's vice-chaiman George Mrkonic essentially told the Internet to go away, when he said: "doubling or tripling our Internet sales wouldn't do anything for our profit." Instead Borders is building 45 new superstores, which feature coffee shops and live music. But these up-market stores still won't be able to stave off Amazon. continued...... Glotech