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Technology Stocks : Westell WSTL -- Ignore unavailable to you. Want to Upgrade?


To: Michael F. Donadio who wrote (20444)9/17/2000 5:46:43 PM
From: puborectalis  Read Replies (1) | Respond to of 21342
 
Slow road to DSL satisfaction



Dslreports.com

By PETER SVENSSON, Associated Press

NEW YORK (September 17, 2000 3:16 p.m. EDT nandotimes.com) - The ads are everywhere: High-speed
Internet over your phone line!

Baby Bells and Internet service providers are pushing digital subscriber lines, or DSL, as the way to get the
home connected. What the ads don't say is that DSL installation fails in many cases, leaving customers fuming.

Dana Smith regrets ever ordering DSL for her Brooklyn, N.Y., home. After five months of struggling with three
different companies involved in the installation process, she still has no high-speed Internet access.

"It's been a nightmare. Everything's a big mess," she said.

At its best, DSL is an elegant technology that speeds up Internet downloads more than 10 times compared to a
dial-up modem, yet leaves the phone line free for regular calls. And it's offered at a price many are willing to pay
for a fast onramp to the Internet: typically $40 to $60 a month after a setup fee of $100 to $300.

According to analyst Lisa Pierce at Giga Information Group, there were 570,000 DSL users in the United
States in March, and the number is expected to grow to 15 million in five years, making it the most common
form of residential high-speed Internet connection after cable modems.

But many customers find the road to the high-speed Internet is slow and tortuous. There are Web sites devoted
to the grievances of DSL customers, and newsgroups are full of tales of incompetent tech support, installation
no-shows, and service outages.

A large part of the problem seems to lie in the way DSL often relies on the cooperation of three companies.

An Internet service provider, or ISP, typically sells the service, then contracts with one of the three big DSL
technology companies, Covad, Northpoint or Rhythms, to connect the customer. The DSL companies in turn
need the collaboration of the local phone company to do some of the installation work, and use its facilities for
their equipment.

Customers whose installations run into problems often complain that these companies hardly seem to talk to
one another, and pass blame instead of fixing problems.

Smith ordered DSL in March from the ISP Teliquest, which contracted Covad. But the installation, which also
involved her local phone company, Verizon, soon bogged down.

"Everybody's pointing the finger at each other, and nobody takes responsibility," Smith said.

One problem DSL customers face, according to Verizon spokeswoman Joan Rasmussen, is a lack of free
phone lines due to the densely populated New York area.

But there can also be confusion because of the different companies involved. Rasmussen said the Verizon
DSL operation is separate from the rest of the company, and is treated the same as competing DSL
companies like Covad when it comes to installation requests. Verizon does not deal directly with Covad
customers, who have to pass request and questions through Covad.

Customers can feel like they're getting the run-around. Smith said Verizon canceled Covad's request to fix
problems with the line. When she called to complain, a Verizon salesperson offered her their own brand of DSL.

Another common complaint is that DSL is unavailable because the facility that gathers all phone lines in an
area, the so-called "central office," is not properly equipped, or because the copper phone line is too long or
poorly maintained.

"The problems stem from the age of the copper network and what has happened to the copper network over
those hundred years," said Judy Reed Smith, chief executive of analyst group Atlantic-ACM.

Telecommunications industry estimates of the percentage of phone lines that are technically fit for DSL range
from 30 to 60, Reed Smith said. "You get the most pessimistic estimates from the people who have been in the
industry the longest."

But DSL providers tend to go for the low-hanging fruit, the customers with good phone lines, said Justin Beech,
who operates Dslreports.com, where DSL customers rate their providers.

"They're advertising like crazy, but on the other hand they're not interested in customers who are on the limit of
being able to get DSL," he said.

Even when DSL has been installed, it's not always reliable. Giga's Pierce tells users to expect the connection to
be down an average of two days a month, unless it is a more expensive "business-class" account. Keep a
regular dial-up account as a backup, she cautions.

"There's a lot interest out there, that's clear, but a lot of people are finding a cable modem is less of a hassle,"
said Beech.

Even David Farber, chief technologist of the Federal Communications Commission, has problems with DSL. In
his e-mail newsletter last week, he said his line had been out for five days, and the chain of companies that
provides it were unable to fix the problem.

"If this is typical then our image of the future of always connected households ... is just a bad dream," he wrote.



To: Michael F. Donadio who wrote (20444)9/17/2000 11:21:26 PM
From: P314159d  Respond to of 21342
 
Just remember that i have already...

LOST MY MIND!! <g>

But picture the PE returning to last qtr numbers after the earnings.
Average PE on FY 2002, last qtr was about 34 as seen in the table below:

Westell Vs. PPE
Calendar Avg.SH. Current Expected Earnings Next Year
Quarter Price PE PE Estimate Earnings
4Q99 10.00 100.00 33.33 0.10 0.30
1Q00 24.75 130.26 61.88 0.19 0.40
2Q00 20.50 89.13 34.17 0.23 0.60
3Q00 19.00 61.29 21.84 0.31 0.87
4Q00 30.00 66.67 31.58 0.45 0.95

Note that investors simply don't "believe" the .87 for next year.
After this qtr, they will. I have provided a guestimate for what the analysts will adjust too after this qtr for next qtr. As can be seen, an average stock price of 30 next qtr would still be low. I don't expect a return to Q1 data.

Yet.