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Technology Stocks : WCOM -- Ignore unavailable to you. Want to Upgrade?

To: telecomguy who wrote (10495)	6/6/2002 12:26:04 PM
From: tejek	Respond to of 11568

1) Doesn't Wcom have to pay the RBOC's for the "last mile connectivity" to terminate the calls? So if the consumer gets unlimited calling, it's possible that many of these Neighbourhood customers will generate LOSSES for WCOM? 2) Will this plan likely only attract the heavy local users? So all WCOM ends up doing is subsidizing these heavy users since the $50 won't cover the payouts that has to be made to the RBOC's who own the copper to the homes. This plan could generate new revenue but at NEGATIVE cashflow!!! Of course, why do you think its trading at $1.40? Because its future is assured? Once again, when you buy a stock, you buy its management..the Neighborhood Plan is only as good as the people who put it together. Nonetheless, one of your points I can respond to fairly readily. I see from your writing that you are probably Canadian or English. If the former, then you may understand better what I am about to say. This is a big country and Americans tend to sprawl with family and friends all over the place much like myself. If people are in fact like me, they will be attracted to the Neighborhood Plan not so much for its local benefits but any advantage it can provide re long distancing calling. And its in that niche from where I think the majority of the users will come. Savings in long distance calls will be the draw. Will it prove to be a postive or negative for WCOM....I don't have a clue. However, the market has priced into the stock just about every negative possible and does not see anything that will be a boon to WCOM in the foreseeable future. That means if the N.P. proves to be even mildly successful, WCOM's stock will benefit. ted EDIT.WCOM just went positive in the middle of this miserable market day!

To: telecomguy who wrote (10495)	6/6/2002 12:35:38 PM
From: Oeconomicus	Read Replies (1) \| Respond to of 11568

It's no different than selling competitive local service, except that they then bundle fixed fee/unlimited use long distance into the product. As for heavy users being the only takers, resulting in losses, I doubt it. First, many low and moderate volume callers will take it simply because unlimited anything at a modest fixed price seems like a bargain - some probably thinking "hey, I can call Mom more and not worry about the phone bill." Second, what's the marginal cost of a LD minute? I doubt it's much - probably barely measurable. I'd bet there's more money in how many customers you have than in how many more minutes you can bill a given one. Third, I'd expect that fixed monthly fees would also result in better collections. Didn't AOL say the same thing in resisting fixed fee/unlimited use Internet access pricing a few years back? BTW, what makes you think $50 won't cover the payments to the RBOCs (ILECs)? I pay BellSouth $17.45 for a residential line. I doubt the Telecom Act would allow an ILEC to charge a CLEC three times what they charge me. Are you really a "telecomguy" or just another naysayer?

To: telecomguy who wrote (10495)	6/6/2002 5:39:41 PM
From: John Curtis	Read Replies (1) \| Respond to of 11568

Telecomguy: Good questions. "Doesn't WCOM have to pay the ILEC's (RBOC is an old term, heh) for the last mile connectivity?" Yup, but at FCC mandated rates which amount to wholesale or less. Bottom line is this charge is less than what the ILEC would charge you or me for the copper. Therefore the rest of your argument about heavy/light users is mote as long as WCOM charges some goodly percentage above their ILEC rate. It could generate some nice cash flow if they're able to lock their customers into extended contracts. As for how they could lose money in the wireless resale arena....yah...I was puzzled about that, too. But consider....WCOM might have contracted for 'X' number of wireless connections/ports, without regard for the actual sales numbers they could attain. If they failed to attain the contracted numbers....well....in a simplistic fashion there's your loss. It could be that simple. Now let's see how tomorrow goes in the market, what with INTC's little bomb-shell which you KNOW is gonna roil everything. Oh...and by the by...if you're really resaling in Europe (no offense intended) then I applaud your timing. What with that continent finally coming together, and all the cities newly (pretty much in the past 10 years) fiber, or cellular, wired together - well - at least in western Europe (heh), you picked an excellent time to resale over there. Given similar opportunities that occurred here in the U.S. starting in the late '80's I'd say you've got 10 years of open field running before the competition catches yah as long as you're aggressive. Good luck! John~