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Technology Stocks : Leap Wireless International (LWIN) -- Ignore unavailable to you. Want to Upgrade?

To: pcstel who wrote (1176)	1/28/2002 7:49:07 PM
From: Maurice Winn	Respond to of 2737

PCSTEL, I've been aboard since post number 9. I sold the lot here: Message 13118303 I'd decided that Leap wasn't going to do much more [to improve on $94 a share] any time soon and Globalstar was about to go crazy as they trimmed the minute price to meet the market. Unfortunately, they didn't meet the market, so they are meeting the bankruptcy court instead. That seemed a poor business decision to me - they certainly had me fooled. I couldn't believe that they'd rather sleepwalk to the poorhouse than make a success of the business. I'd have been better to stick with Leap [and only go from $94 to $13]. QUALCOMM doesn't have cold feet over NextWave, they are simply and sensibly avoiding contributing $300 million to creditors in the absence of spectrum resolution. If Hollings doesn't want any money and prefers years of litigation and no NextWave service, then why should QUALCOMM give $300 million away Message 16973443 You are quite careful in your investing, and I like to keep an eye on Leap, so I'm wondering whether there is an opportunity here. I like the eat-all-you-like idea for voice, but it means underused networks [so that there is spare capacity for peak times]. "Too cheap to meter" was the claim of nuclear reactor proponents in the 1950s. That turned out not to be entirely true. In fact, it turned out to be too expensive to use [when the political context and costs were loaded on]. Similarly, I think Cat's Eyes marketing where the price per megabyte or minute is a function of instantaneous demand and the price per minute or megabyte shows in the cat's eyes on the screen before pressing SEND is the solution to peaks and troughs in demand. It would enable no busy signals, EVER! If the price per minute could be low enough [no sign of that so far] that the cost of metering and billing exceeded the value to subscribers of getting cheaper service, then networks could run at 15% capacity and build more and more base stations to ensure peak demand isn't a problem. The published cost per minute [by QUALCOMM] suggests that unmetered megabytes are economic, but the reality of charges is far from that potential. To be assured of a connection and no busy signals even in the busiest time at the Super Bowl when somebody hits a Homer and the crowd goes nuts, phoning home or replaying it in cyberspace, I still think there will need to be a price penalty for wanting service at busy times. To be in a hijacked plane, wanting to get an urgent call through, only to get a busy signal because people are gossiping and blocking the spectrum, would be very frustrating. It would make sense that calls be allocated on price [just as other things are in the world of free markets and private enterprise]. Now, would Verizon cannibalize their wireless business to cannibalize their wireline business? I had exactly this discussion in my BP Oil days. I argued for methanol in California [investigations and preparation] to reduce pollution. The refiners reckoned I was nuts because it would cannibalize $$billions in gas station equipment, refineries and stuff. My argument was that if motorists and politicians decided it was a good idea, then if BP did it and did it well, we'd get the jump on the market, synergize with existing business [swap over some pumps at retail stations to methanol, use trucks for gasoline or methanol, laboratories, marketing, staff etc] and go from a low market share to a higher one. It would keep chemical companies out of the market [they could soon build methanol service stations if the oil industry was asleep at the wheel]. If BP didn't do it, there were hundreds of other companies which would. So, without BP in the market, BP would still lose the $$billions in refineries and marketing if they became obsolete, but not have a share in the new methanol business. Charles Schwab had a similar issue when on-line share trading became big deal. They decided they would lose their high-margin business anyway, so they gave customers a choice. They did extremely well and was the example held up to support cannibalizing one's existing business. The mobile wireless business is like the gas station business. People want to be able to roam [and not run out of gas in Hicksville where there is no 'coverage']. It's competitive; there's a base station at every gas station [almost]. It's very price sensitive business. Therefore, if competitors have a price war, it's a big business risk. Sitting fat, dumb and happy on wireline and high-ARPU business is not an option. Churn is common in the mobile business. What if Verizon offers a 'Free and Easy' plan, where service is unmetered in cities, but expensive when roaming in the hinterlands [where providing coverage costs serious money]? Free service in the cities, but easy to travel [if expensive]. How the heck would Leap compete with that? Verizon would get economies of scale, network costs as low as Leap's in the cities, profitable roaming [which Leap couldn't offer], and could still offer the old plans for people who prefer them. Competitive action must lead in that direction as far as I can see. Mqurice

To: pcstel who wrote (1176)	1/28/2002 8:31:17 PM
From: Maurice Winn	Read Replies (1) \| Respond to of 2737

PCSTEL, Answering your question a bit more, yes, it's a good point, that Verizon doesn't have the city capacity for unmetered voice and it wouldn't be attractive to install extra capacity to lose some customers to the new cheap service and gain some low-margin subscribers. But it's a competitive world and the suppliers tend to find ways of increasing market share. I'm not sure that capacity and coverage are conflicting variables in a CDMA network. But as you say, to fight over the Leap market share might not make sense for the coverage and roaming companies. I'm sure that technology will fill the gap between the networks because subscribers want universal access and not too many gadgets to cart around. I suppose it's a matter of 'watch this space'. But Leap looks vulnerable to me when there are so many competing networks all trying to get the marginal customers. Mq PS: It's a pass on the annual Q! meeting this year. Summer is too good here and a couple of thousand [Kiwi] dollars for a couple of days in San Diego is a bit of a stretch. Hmmm, it's tempting though [I usually stay a month to make it worthwhile]. Maybe in summer I'll do a raid. The wacky airline staff have gone berserk too, since 911, so I don't know that running the gauntlet of security is worth it. Maybe something I've written in SI that didn't imply the USA is the greatest place on the planet would lead to the FBI and CIA and NSA and Anti-Terrorist Goons deciding to put me in a cage for a few days to investigate why I'm not carrying baggage or something - they seem quite rabid these days [though admittedly they are media reports, which have limited credibility]. Queues at airports are not my favourite place, even in good times.

To: pcstel who wrote (1176)	1/28/2002 8:55:59 PM
From: straight life	Read Replies (1) \| Respond to of 2737

Western Wireless Stock Off More Than 30 Percent NEW YORK (Reuters) - Shares of Western Wireless Corp. (Nasdaq:WWCA - news) on Monday fell to a new year-low after AT&T Wireless Services Inc.'s (NYSE:AWE - news) new joint venture with Cingular Wireless fueled fears that Western Wireless would lose roaming revenue, analysts said. Shares of Western Wireless plummeted more than 30 percent, or $4.60 at $10.62 on Nasdaq in afternoon trade. The company's shares, the second largest percentage loser on Nasdaq, are trading under its former 52-week low of $13.39. AT&T Wireless, the nation's third-largest wireless operator, on Monday said it formed a joint venture with Cingular Wireless, the nation's second-largest wireless firm, to jointly build out a next-generation network along interstate highways in Midwest and Western states. Analysts said investors were worried that Western Wireless, which serves those areas, would lose roaming revenue as a result. Wireless firms receive roaming revenue when a customer on another network uses their networks. Until now, Western Wireless derived about 67 percent of its roaming revenue from AT&T Wireless. Roaming revenues comprise about 30 percent of Western Wireless' total revenues. ``People are speculating that as much as half of the 67 percent could be immediately impacted by this joint venture,'' Frank Marsala, wireless analyst with Robertson Stephens, said. Marsala speculated that wireless operator Leap Wireless Inc.'s (Nasdaq:LWIN - news) stock was also being pulled down for the same reason, although he added that Leap should not be affected by the joint venture. ``My impression is that Leap is becoming part of the speculation as well. They're trying to raise the question, 'Who else is being hit by the joint venture?','' Marsala said. Shares of Leap Wireless were off $2.03, or 13.02 percent, at $13.62 on Nasdaq.