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Technology Stocks : StorageNetworks, Inc. (STOR) -- Ignore unavailable to you. Want to Upgrade?

To: David Hansen who wrote (54)	7/24/2000 11:25:17 AM
From: The Other Analyst	Read Replies (1) \| Respond to of 187

Thanks for your insights about STOR. Re the acquisitions you believe will occur...are there many candidates out there to be acquired? If so, does that indicate that STOR is not really way ahead of the competition? I can believe this company has great motivation to succeed. The milestones you list do not impress. > 60% of revenues from storage is going to happen since they are deemphasizing the professional services. What would be a more important milestone is the absolute level of storage revenues. When should they reach $1 billion of storage revenues? (That they are expected to do it soon is already in the stock price, seems to me.) Leadership in professional services that will remind you of INS's performance.....not sure what that means or how I will know when the milestone is reached. 3 for 1 stock split. I'm not impressed by stock splits by themselves. An early acquisition and an announced strategy around planned acquisitions. This is the one milestone you list that intrigues me. But as I noted above, if there are many acquisitions out there, doesn't that imply ease of entry to the sector and many competitors? You seem to know something about the storage area. Are there some standards that will be needed, and if so is there a benefit to STOR being the one that sets the standards? If so, when will we know if they have set those standards?

To: David Hansen who wrote (54)	7/25/2000 1:33:09 PM
From: The Other Analyst	Respond to of 187

Where are the barriers to entry? I reviewed George Gilder's recommendation on Storage Networks from the June issue of the Gilder TEchnology report. The key paragraph in the report was the following: The key issue for the company is barriers to entry. What SNI pioneered in two years can presumably be accomplished more quickly by other companies that benefit from the SNI learning curve. However, it will not be easy. Raising $203 million of venture capital, hiring several hundred storage engineers, contriving two complex software systems suitable for diverse customers in oil, finance, and on the Web, negotiating thirty-six-month guaranteed Service Level Agreements (SLAs) with scores of customers from Merrill Lynch to X:Drive—all in just two years—Storage Networks is showing real prowess running with the bulls on Internet time. Although the field is crowded and there is scant room for mistakes, Storage Networks is the prime storewidth service provider today. It may not be easy to copy what STOR did, but what is to stop others from doing it?