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Technology Stocks : Covad Communications - COVD -- Ignore unavailable to you. Want to Upgrade?

To: elmatador who wrote (3456)	2/7/2001 6:57:36 AM
From: Steve	Read Replies (1) \| Respond to of 10485

El Matador, Your viewpoint does not match reality. Consumer demand will drive acceptance or rejection of all DSL technologies. The ILEC's will not cede DSL customers to the CLEC's. The ILEC's are at an inflection point in their business. Demand is surging for broadband services but the price per megabit is falling. The ILEC's likely revenue growth from businesses will continue to fall as more and more businesses opt for DSL over more expensive T1 and T3 services. The ILECs must add new revenue streams like LD revenues and international revenues to compensate for the falling cost of all in territory telcom services. It is impossible for the ILECs to service 100% of their in territory DSL business so a certain % of this business will fall to companies like Covad. In fact a DLEC like Covad can help an SBC by allowing SBC to devote resources to higher growth areas like out of territory LD and international. Over the years I have found oversimplified theories of the diffusion of innovation to be wrong. Case in point is the much heralded death of the desktop computer. While this market is now highly cyclical and growth may slow to single digits in future years the desktop is far from dead. The devices that were once seen as replacing the desktop are now seen as supplements to it.