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Technology Stocks : JDS Uniphase (JDSU) -- Ignore unavailable to you. Want to Upgrade?

To: KMcKlendin who wrote (20633)	6/22/2001 7:20:52 PM
From: OWN STOCK	Respond to of 24042

KMc: The technological lifetime these days is running about one year. Ten years from now is ten lifetimes. There is no possible way to know what will happen in detail that far out. We can say that traffic will probably double every year...but will that mean 40G or not, even in the near future, is tough to say. 40G is very tough to work with, and may very well be more expensive than it is worth, or may require new fiber breakthroughs to make it economical. A big issue at 40G is polarization mode dispersion...which at present must be fixed with another device in the line...more complexity....more cost. There are other issues as the speed goes up... IMO, things will "stick" at 10G for quite awhile...and companies will simply bury more fiber lines...we need a breakthrough...that breakthrough may not be 40G... -Own

To: KMcKlendin who wrote (20633)	6/22/2001 8:38:26 PM
From: Cary Salsberg	Read Replies (2) \| Respond to of 24042

RE: "Your concern that 10 years from now, JDSU may have half its peak sales is incompatible with my view of a strong long term growth trend." First, I believe we all agree that the JDSU peak sales came in the midst of an internet driven tech bubble which distorted both stock prices and business levels. This is the basic problem. We don't have a useful track record. When I said $450M/q for 10 years, I didn't necessarily mean perfectly flat sales. I was more concerned that the $18B over ten years, with improved technology to increase transfer speeds and/or the number of channel frequencies could meet the bandwidth demand. This could mean falling to $200M/q and then rising linearly to $700M/q over the 10 years, ~20% compound growth. I think the investment community is clueless about the near term business prospects and about what the trough revenue levels will be. I think, after revenues fall in successive Qs from $900M to $600M to an initial forecast of $450, it would be prudent to wait until revenues stabilize. In the current environment, one must carefully balance greed and fear. $700M/q after 10 years only merits a price of $14 at a P/S of 6. This is only one scenario, but it puts things in perspective. To get much higher JDSU will need sales considerably higher than bubble levels. I can't rule out that possibility, but I haven't seen a persuasive argument for it.