To: Gerald Walls who wrote (15594 ) 12/28/2000 2:00:41 PM From: SJS Read Replies (2) | Respond to Some thoughts on infrastructure spending? Time to review our previous hypothesis' and axioms?Six months ago, industry watchers were saying that infrastructure spending was one of the areas immune to a slowdown, because if you don't keep up with your competition in infrastructure upgrades, you lose. Well not only has the competition slowed their spending, the competition is going broke. The lack of funding for dotcom companies means fewer customers spending less money on content delivery as well as networking hardware. The slowdown is affecting everyone, but is especially painful for those companies that serve small and midmarket clients. Such is the case with F5. As was the case with Foundry, F5's dire warning that they see a sequential revenue decline of about 30% due to rapid deterioration in market conditions, seemed to sneak up on the company. This suggests that ISPs, e-commerce companies, colocation service providers and Internet content sites have suddenly drastically axed their infrastructure spending commitments. What happened that precipitated such a severe and sudden dry-up may or may not be explained on F5's conference call after the bell, but it certainly has negative implications for not only the network companies like CSCO, JNPR and EXTR, but for the caching, content delivery and traffic optimization service vendors like CFLO, INKT, and AKAM who also rely on infrastructure budgets. And don't exclude the aforementioned customers (ISPs, e-commerce companies, colocation service providers and Internet content sites), they've got estimates to meet, and they're slashing expenses for a reason. - Matt Gould, Briefing.com
