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Strategies & Market Trends : Sharck Soup -- Ignore unavailable to you. Want to Upgrade?

To: Merlo who wrote (36241)	9/29/2001 1:11:39 AM
From: Sharck	Read Replies (1) \| Respond to of 37746

Some views from the inside telcos: Sharck: What are your prospects for the rest of the year? "We have $38m in the bank, basically couple of years of cash. Preparing for the nuclear winter. We are the leaders, it's just a question of who is left standing at the end of the match-we must be the guy left standing. Not a dime of capital out there, so our competition is under a lot of pressure-don't think they can go the distance. Not looking to hire any new guys now-I've gotta pull the team together. We are well positioned with trials in most of the major telcos-mostly technonogy trials, we need to turn those into cash generation machines". Sharck: and what about the clecs? will XOXO and MCLD survive or be the next casualty? "We are doing some work with both--they are in reasonable shape-I don't think they will fall, but these are tough unpredictable times. I do expect further consolodation. there will only be 5 top players left in 18 months, these guys will be consolodated or dead. Remember my last cautionary stock prediction "sell sonus short" +-2 months ago? well they just got eaten down to $2 from $20's. My sense is inventories are still high, and inventory turn ratios are low. As such, we could see the worst in 15 years for numbers. A lot of companies will break in q1, or calendar q4 will have real crap numbers, q1 will be dead, and if there are no more terrorist attacks, things will pick up slightly in Q2, and re-ramp in q4 next year. Consumer confidence has taken it on the nose, and I don't see the catalytic event to bring it up, so it will be a question of time and emotional recovery. Sharck: whats the atmosphere in CA? "There are a lot of people in Silicon valley living in big debt land, anyone in hi tech had bought houses, cars, clothes, vacations, on assumed equity from stocks / options, all of which are under water. The whole social scene is dead-used to be huge wonderful parties every weekend. Now there are special parties where all the guys who got laid off have a get together. There are in fact web sites, and regular special events for the laid off crowd (only in California) - "I got busted" party- meet your new street colleagues"- golf outings for the unemployed. I know a couple of guys who are making investments in startups, on the premise that rent and labour is dirt cheap (contractors who used to charge $800-$1000/day, now charge $300 day-rents are cut in half or more. So it is a perfect time to start a business, build the product for 1-2 years on the very very cheap, then go to market in 18-24 months. Most of this is going on below everyones radar screen-couple of savey guys doing it with angel funds. I'd look for opportunities to get in on some of that action with trusted, reputable, and savvy people".