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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (44789)	7/22/2001 5:34:03 PM
From: techreports	Read Replies (3) \| Respond to of 54805

Buffett actually understands technology better than most people on these threads. he just doesn't understand how most of the businesses will be profitable in the long run. he could have made a killing doing greater-fool momentum investing in technology along with all the rest of the momo players, but that is not his style. he has been perenially bothered by the lack of barriers to entry in most every tech field, which has been exposed in the bear market. but only MSFT has a true moat around its business in Buffett's sense. as for the rest of them, to paraphrase an old wag, there's not too many business models that can't be wrecked if VCs throw a billion dollars at startup competition (e.g., JNPR's impact on "invincible" CSCO). Same for any industry. Throw enough money at it and you'll eventually win. No company is invincible (unless maybe you're a government regulated monpoly). It's possible Pepsi could unseat Coke. That's if Pepsi wanted to spend 20 billion on advertising and another 10 billion on distribution. Heck, the only reason people buy Coke is because of their brand really. Not really a barrier i'd consider very big. People HAVE TO BUY WINDOWS. Of course, just like Rome, Microsoft will fall someday. btw, i'd also like to point out that Southwest has made a killing, yet this is suppost to be an industry that sucks? Buffett has made comments that he would have shot down the plane at kiddy hawk so he would have saved investors' money. Then how does one explain Southwest? Southwest has some barriers, but eventually, competition will figure out a way and eat into their market. Btw, southwest has been profitable for like 20+ years! Southwest's advantages: -buys contracts for oil, to hedge its bets from price swings in the oil market -uses only one type of plane (boeing 747 i think) -focuses on being the lowest cost provider (no meals) -spending lots of time and money on examining their employees. For example, Southwest wants employees who have a certain type of spunk and are always happy. If employees are happy, reports have shown that customers are more happy. There are others, but those are just some. That said, this is nothing a competitor couldn't copy IMO. p.s. i understand Coke has more barriers. Obviously, they've continue to dominate for over 100 years. Gatorade has dominated while Coke is unable to get more than 13% share with its poweraid drink. This is enough history to show me that these companies have some form of competitive advantages.

To: Wyätt Gwyön who wrote (44789)	7/23/2001 4:27:34 AM
From: Seeker of Truth	Read Replies (1) \| Respond to of 54805

When VC's are ready to throw a billion dollars to compete with a gorilla, the prices will again be insanely high. Since we all rule that out for a long long time, your remark is purely theoretical. You said there are "not many" etc. That's the purpose of this thread, to find the real gorillas. I happen to think, for example, that neither VC's nor IBM will throw some billions around to compete with INTC. Not that the PC Cpu business is booming; it's just that INTC controls the value chain. QCOM's control looks solid enough to make any VC quail. Assuredly there are "not many" as you say. The problem is to determine them and to buy them at a reasonable price.