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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: tradeyourstocks who wrote (14061)	8/18/2001 3:35:05 PM
From: noj	Respond to of 197542

And Lehman weighs in: dailynews.yahoo.com Saturday August 18 7:54 AM ET Lehman Analysts Skeptical of NextWave's Launch By Jeremy Pelofsky NEW YORK (Reuters) - Wall Street analysts at Lehman Brothers said they were skeptical of bankrupt NextWave Telecom Inc.'s plan to emerge from bankruptcy, questioning its strategy, financing, network and customers. Lehman Brothers said on Friday in a research note that it would be surprised if the wireless company, which is fighting the government to retain valuable wireless licenses, built a high-speed mobile wireless data network. The licenses, which the government tried to repossess and resell, cover valuable markets like New York and Los Angeles and other wireless carriers like AT&T Wireless Services Inc. (NYSE:AWE - news) and Verizon Wireless (NYSE:VZ - news)(VOD.L) are anxious to get their hands on them to expand and improve services. Verizon bid about $8.6 billion for 68 licenses involving NextWave's disputed airwaves, while AT&T's partner Alaska Native Wireless bid $2.7 billion for 28 licenses. ``While we wait for further details, regarding NextWave's plans, we still think it unlikely the company follows through with its plans,'' Lehman analysts John Bensche and Courtney Kelleher said in the note. ``We believe the NextWave spectrum will end up in the hands of those who bid for it in the re-auction.'' On Thursday, NextWave Chief Executive Officer Allen Salmasi laid out for Wall Street analysts the company's plans to launch its network in 95 markets by April next year and add voice services in late 2002, but act as a wholesale provider of network access to various content providers. ``It doesn't make sense to us, however, why the company plans to build out almost solely a data-only network when wireless data usage is hardly a hotbed of activity,'' they said. NextWave has filed its plan to emerge from bankruptcy and is near completing its roughly $5 billion in financing, including a $300 million investment from Qualcomm Inc., a wireless technology firm for which Salmasi used to work. The company plans to unveil its debt agreements soon. Salmasi has said it is near wrapping up subscribers for the $2.5 billion to $3 billion in preferred stock the company plans to offer to finance the network launch. The Lehman analysts also questioned NextWave's plans to offer network access to content providers like financial and entertainment services and said the company's management structure, which consists of a small group making the decisions, may make it tough to lure investors. ``We wonder who would be involved in taking a large economic stake in NextWave for a small voting position,'' the Lehman analysts wrote. The licenses NextWave plans to use for the network are tied up in litigation as the government plans to appeal a lower court ruling that said the Federal Communications Commission (news - web sites) illegally repossessed the licenses despite NextWave failing to pay for them on time. The FCC (news - web sites) also asked the court to stay its ruling until the Supreme Court decides whether to hear the case. The high court is expected to decide whether to hear it in late November and if it does, a decision would not likely come until June 2002. ``It does not seem rational to us that NextWave would chance cashing in on a near term, low-risk 'sell' strategy in favor of a long term, high risk strategy of 'build,''' the analysts said. Lehman has strong buy ratings on AT&T Wireless and Sprint PCS (NYSE:PCS - news).