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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: mahler_one who wrote (42151)	7/29/2004 6:08:36 PM
From: mahler_one	Read Replies (1) \| Respond to of 42804

Take a look...more Cody... m1 Verizon Says More FTTP on the Horizon Verizon reported a shockingly strong quarter on Tuesday, showing explosive growth in its wireless business. The company said it continues to see strong demand for transportation and high-speed circuits. The fiber-to-the-premises update was high on the wow factor. Even as confident as I have been about Verizon rolling out FTTP, I was surprised to hear the potential magnitude of the intermediate-term rollout. This comes straight from the horse’s -- Verizon CEO Ivan Seidenberg -- mouth: “Where we think the fiber-to-the-premise architecture really works -- [where] Fios really makes a difference -- is if you look at the capacity to requirements in a household. Beyond telephony, you're looking at capacity that could exceed 50 megabits because, as HDTV rolls out and people have multiple HDT channels, our view is that an architecture in which the customer has to stitch together multiple technologies to provide the overall customer experience is one that might work. “But it doesn't create what we think is the compelling case for us to expand our adjustable market and really make a difference to the customer going forward. So without all of the details that I know all of you want, I think, strategically, the way we think about our fiber project is we look at this as a, say, for example, a three to four or five-year project, in which we concentrate on a significant portion of the lines that we serve. If you look at the current business, somewhere between 50% and 70%, for example, of all the lines we serve today would be candidates for this kind of an architecture. We think about rolling it out, getting significant cost savings, improving the customer experience and actually having a breakthrough strategy that gives us a chance to grow the Telecom group. “I believe that DSL, and all of the successor technologies to DSL, are very positive and very good. They will probably do no better than offset most of the voice loss long term. They give you some capability in video but not the full capability that we look at.” I italicized the two critical parts in the quote above: namely, that Verizon is considering building out 50% to 70% of its 40-million-plus lines and that it sees digital subscriber line (DSL) as simply a zerosum game with voice-line losses. I’ll tell you right now, if Verizon takes FTTP to 20 million households (the low end of that 50% to 70% range) in the next few years, MRV, Finisar (FNSR:Nasdaq), JDS and others are going to see their revenues explode from here. MRV especially. Seidenberg’s comment was made in a somewhat passing manner, so I want to hear more from the company about it, but even that Verizon is considering such an incredibly aggressive buildout knocked me out of my chair. For what it’s worth, 20 million homes at $1,000-per-home passed equals $20 billion of spending on FTTP from just Verizon over the next “three to four or five years.” A huge number, but also a very doable number for this behemoth. Note, too, that the $1,000 price tag will continue to drop slightly on that kind of volume.