To: Valueman who wrote (1547 ) 12/5/1997 4:40:00 PM From: JMD Respond to
Great posts, Valueman! Didn't want you to think you were all alone beating the drums for the bulls. Maybe it's because we all spend so much time focused on LOR that Wall Street's perspective seems so peculiar. Mr. Schwartz is guilty of running the show on EBITDA, and the Street wants to see net income or forget it baby. Seems to me he could show a "profit" in '98 at the drop of a hat merely by capitalizing--rather than expensing--the G* constellation development. He takes the more conservative approach, effectively saying: Look, until the birds are up and operating, we don't have revenues, and until we do, I'm going to take the position that the constellation is not a proven asset, ergo, expense it. Then he commits the unpardonable sin of going into an industry that is still unproven, other worldly, and, oh by the way, don't these damn things blow up all the time? Readware's invaluable posts have made it so clear that satellites are a forty year old business (Sputnik, 1957 right?). They have been providing communication capability for the military, consulates and the like for at least 25 years that we know about. And just in case you flip on the boob tube tonight, your picture got there by birds even if the 'last mile' came on cable. This is nothing more (or less) than the commercialization of cold war technology, and old cold war technology at that. That still makes it very exciting given all the improvements in communication and launch technology, but it's a long, long way from pioneering.
