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Technology Stocks : GX Investors Thread -- Ignore unavailable to you. Want to Upgrade?

To: Maurice Winn who wrote (253)	9/1/2001 3:26:30 AM
From: DWB	Respond to of 586

Maurice, Will respond on the Rant content in more depth later, but Robert isn't banned, he left when the other GX thread (the mudpit) became more of a personal pissing match than a stock investment discussion. That was just about the same time that qveau created this thread... Robert's comments would be more than welcome here if he ever starts posting again. DWB

To: Maurice Winn who wrote (253)	9/1/2001 10:36:07 AM
From: M. Charles Swope	Read Replies (1) \| Respond to of 586

"We are not in the business of competing for contracts based on price." I used to hear on this thread that GX welcomed a fall in the price of bandwidth as their system had the lowest costs and they would have an advantage in a price driven, competitive environment. It was frequently stated that their business model assumed falling prices. Now, we have statements from GX itself that they are not interested in simple low cost contracts but are looking to deliver more sophisticated services. I suppose these statements and positions can be reconciled but, at the least, the emphasis seems to have changed to a business model different from what was touted here in the past.

To: Maurice Winn who wrote (253)	9/2/2001 12:51:34 PM
From: Ally	Read Replies (1) \| Respond to of 586

Yes, they are. They might not know it but they are. All contracts where dollars change hands are competed for on price. Not really... contracts are competed based on many other factors other than price. In the case of a network, reliability would be top consideration. But along with the rest of the context, it reads to me as though they are denying the importance of price in any contract. Price is what it's about and how the value is measure. This is warning number one. If they have a great new super-efficient product, price should be a number one part of what they offer. I don't think one can draw "warnings" in strategy deficiencies based on perceived inferences from Casey's speech. If they have a super-effient product, price shouldn't be number one consideration. OTOH, if GX's network is no less unique than other networks, then price would be an important consideration. The big issue is whether GX's global IP network is indeed unique and will clearly differentiate itself from the others. Management frequently states that indeed the network is a "differentiation" from the other non-integrated networks. The market seems to imply "no big deal" whether a network is global and integrated, or whether it is made up of different segments from different vendors. Does it really make a difference for a customer to place its IP needs with a integrated supplier like GX, or with Qwest or WCOM, providing same end results by coordinating/consolidating many networks? The understanding (or perception) of customers to the technical issues of dealing with a network such as GX, or a network such as WCOM, would directly influence pricing.

To: Maurice Winn who wrote (253)	9/3/2001 10:33:44 PM
From: DWB	Read Replies (1) \| Respond to of 586

OK, let's give it a shot here... oh, by the way, Casey is the current CEO... Why would they need to radically change the sales force methods? Because they were originally going to be a "carriers carrier", then they lost focus for a while when they went through a succession of CEOs. They are now back on focus, have divested their web hosting and CLEC businesses, and are ready to move forward. Any customer is a good customer. Not if that "customer" isn't really buying what you are selling. I see the "simple solution for a simple customer" situation more like someone like Boeing. If you are Boeing, and you sell very expensive airplanes to airlines, do you also therefore have to sell single seat aircraft to individuals, just because they want a plane? No. As a matter of fact, the more I think about it, Boeing is a good analogous company to GX. They both build or have built systems that carry items around the world (planes/people & stuff, fiber network/data & voice), but are really selling to corporations because that's where the big volume exists. How complex can the problems be? When connecting the multi-TRILLION dollars worth of financial transactions a day for SWIFT, or the worldwide embassies of the UK, or the US government research labs, or the NATO data centers, at Gigabyte/second speeds I imagine it's pretty complex. Especially if your customer wants to have a certain kind of interface, a certain method of billing, a certain amount of bandwidth available at all times... If the large customers are 'coming to us', then they are an easy sell. Again, see the Boeing analogy. Customers like carriers change bandwidth providers as often as airlines change from Boeing to Airbus...or European wireless carriers change technologies... ok, that was an exaggeration, but the good old boy network needs to be overcome here just like everywhere else. The US government contract that recently got all the news was an AT&T contract that will be switched to GX... now that the contract is expiring. There was an item in one of GX's press releases a while back that said the 4000 (?) MNCs that they were targeting accounted for 70% (or thereabouts) of the total worldwide information traffic. Those are their customers. Not the great ocean of small fry that make up the other 30%. Again, the issue related to salespeople is a carryover from their days as a carriers-carrier. Now they are driving for value added services rather than plain vanilla all-you-can-eat bandwidth. Regarding the truth of the statements about the financial salesforce, it is true, but it's currently specific to the financial arena due to corporate acquisitions in the recent past (IXnet and IPC). This is one area where their carryover salesforce is exactly what they need, and probably one of the reasons they landed the SWIFT deal, and the Chicago trading Board deal... But the benefit of big and broad isn't clear to me. I wonder if it is to the customers. It's perhaps more of an ego thing for the GX bosses. Reduction in interconnect/handoff costs is a big driver in giving GX a price advantage. In addition, as you alluded, there is a speed and quality of service difference. When they got the NATO framework deal, this was one of the paragraphs in the news release... "By moving from the existing system of procuring circuit segments within national boundaries, the framework agreement permits NATO to reduce its number of suppliers from five to one. Apart from cost reductions, added benefits include faster provisioning and greatly simplified billing. NATO will enjoy improved service levels as a result of end-to-end management and a single point of contact for ordering and fault reporting. NATO will benefit from commercial-level service agreements thanks to the high level of availability and resilience of the European network." Here's another quote from another presentation (from late last year) by Gary Cohen (President and COO of Global Crossing Solutions) to better illustrate this point... The whole article is a good read if you have time... globalcrossing.com "Our strategy at Global Crossing is to be right ‘in-step’ with this shift. We partner with the board-level leadership of our clients. We listen to their discussions concerning evolving their products or services and business execution to a new level. We, in turn, mold our telecommunications capabilities around their companies to capture the best and most lucrative forms of business interactions in their markets around the world. Take Deutsche Bank, as an example. They are one of our IXnet financial services customers – IXnet is a wholly owned subsidiary of Global Crossing that provides tailored telecom services to financial services providers. This is a worldwide market and a market area that requires in-depth industry understanding. Deutsche has 7 million customers worldwide. They have 4000 traders located in 20 countries. This is a perfect case study of the kind of company that cannot afford having interoperability issues and hand-offs infecting their communication. They do business in 20 countries, yes, but they don’t want to have to manage relationships and integrate services with 20 different carriers. Deutsche Bank and over 1,000 other commercial enterprises, in the largely deregulated financial services industry, use our IXnet extranet to gain communicative reach to over 34 countries – all on the same network. There are no middlemen, only direct connections on a network that connects continents, countries, and the e-business companies of tomorrow." That's about it... take some time if you have it and flip through GX's website for a lot of good historical and current information globalcrossing.com Click on "About Us" to get an idea of what their large divisions are focused on doing. DWB