Bob, good summation. I too remain highly optimistic (even for the price to close above $4.12 tommorrow) when looking out further at future prospects for Franklin.
It is my feeling that many people, unfortunately are focused on the announcements of other companies within the I-T sector and concluding that Franklin is missing the boat. Further it is my opinion that this misconception is brought on by ignorance of the overall sector and will result in making a timely miscue in judgement. As I continue to believe, that Franklin, will in fact deliver some significant business as the result of their proprietary technologies.
to ellaborate further upon the above beliefs, a significant event took place last week within the telecommunications sector.There was a
Federal Court ruling that former Baby Bells would be allowed to enter the long distance market. SBC (Sourtwestern Bell Corp) won a long standing court battle last week when a Federal judge decreed that regional bells could enter the long distance markets within their own states or regions without first facing local phone competition.
SBC chairman and CEO Edward Whitacre, Jr. said that the company first plans to offer long-distance servcie in Oklahoma as soon as the necessary tariffs are filed and approved. "We intend to provide our customers with one-stop shopping for all their telecommunications needs by offering the simplest, most affordable long-distance plan available."
The decision also effected other parts of the 1996 Telecommunications Reform Act as being unconstitutional whereby it singled out and barred the former Bell companies from providing long-distance service and other services such as electronic publishing and equipment manufacturing.
It is my feeling that the combined statements of the CEO and the decree of the court, now opens a massive campaign to compete in the long distance markets. Internet telephony seems a logical competitve strategy when one considers the direction the market is taking.
If you consider that just SBC alone is made up of several companies such as Southwest Bell, Nevada Bell, Pacific Bell, Cellular One, to name a few. Plus they are global in scope by having a strong presence in 10 other countries. Just SBC alone is a force to reckon with. Now take into account that there are five other RBOC's that also have significant influence within the telecomm sector. All of which have now been given the green light to make a grand entry into thier respective long distance and equipment markets.
All of these former Bell companies provide service to a compendium of other businesses from multinationals to small mom and pops. The resulting equipment needs also encompass everything from large high density telecom equipment, down to the quick, down and dirty mini systems. But no matter what size, one thing remains the supreme determing factor in judging the ultimate success of the respective manufacturer and that is the quality of the audio signal, bar none.
One other important consideration is that the true potential and magnitude of this emerging sector hasn't even begun to be realized. The Internet Telephony market is still in its infancy, and to afix a short term date or even a number to this emerging giant is a grave mistake, in my opinion.
I also think that same consideration applies to FTEL.
I do agree with your assessment that the stock price will most likely result in a lot of downward pressure if they can't produce any significant orders by mid-Feb. But I prefer to focus out past 3 months, 6 months, or as far as that goes, even past an event, such as a single significant contract announcement. I would much rather prefer to be evaluating where Franklin fits in the overall scheme of things in respect to 3 months, 6 months, 12 and 24 months down the road.
Therefore feeling that anyone would be short changing themselves to so quickly write them off if "Nirvana" is not acheived within weeks.
My reasoning is thus; strategies on a much larger scale then just at a company by company level are being contemplated within the industry. It is being strategized at much higher levels, as witnessed by the above announcement effecting all the Baby Bells. Think globally, think across spectrums such as wireless, satellite, cable, fiber, microwave, and the various platforms on which they operate. Then take into account that Franklins equipment works across all spectrums, even cellular. Then consider the number of businesses globally, large to small that place long distance.
After contemplating the scope of the potential long distance market and the equipment to support it, then consider the end-users needs. Capital equipment is marketed on the basis of a rate of return on expenditures. In other words how fast can the cost be recouped by the benefits of either cost savings or generated income derived. But even before those considerations are contemplated, quality will be evaluated. Clear, high quality audio signals will be the first thing any perspective client will notice. Without that there is no need to continue a sales pitch based on anything. Anyone that has ever experienced any of the so-called leaders of I-T technologies will quickly state that Franklin does produce a clear toll quality signal, if not the best, certainly up there in the rankings.
With all the potential business out there, all Franklin needs is to land one significant player as a marketing partner, domestically or worldwide, or both, that can lay down a pipeline of distribution to even a small number of the potential clients.
Will it happen by January, February, March? Maybe! But snt' that just a little shortsighted?
Realistically the entire Internet Telephony story is only in the preface stage. By late next spring many more alliances will be forged, technologies will be improved upon, and competition will also be heightened. Many of the big boys such as the Baby Bells will have to address this emerging dynamo by taking stakes both in developing equipment manufacturers and emerging Internet Telephony communication companies. They can ill afford to be "Johnny-come-latelys."
Entreprenurial startups such as Franklin have the ability to be flexible and can adapt to the prevailing trends early and effectively.
It is my feeling that Franklin and possibly others have been laying back, allowing some of the early pioneers to test and feel their way. In the interim Franklin in all probability is quietly tweaking their technologies while developing new services such as the faxing, video conferncing, find-me/follow-me, and large packet transmission services.
Granted Franklin isn't alone in this arena, but everyone keeps forgeting one key element, quality of signal. I can't stess to anyone the fundamental importance of this one factor. Remember as you read about all the other I-T companies touting press releases about what is going to be. Don't be fooled just because they have a press release, if their audio quality is inferior, then are they really ahead? No, not at all, they are just paving the road, pioneering so to speak, nothing more, nothing less. After all did Tandy or Apple win the computer wars just because they were first ot there?
Keep your eye on who is making alliances with whom, who is venturing or seeding smaller companies technologies.
Categorize the markets by end-users needs.
When the consolidation of this industry takes place, and it will, there will be a surge of instant millionaires. And it isn't going to happen in January, February, or March but rather over the next eighteen months to two years.
No guarantees that Franklin will be amongst them, but I sure as hell am not taking the change that they won't. I am still firmly of the conviction that Franklin has superior patented technologies that set the stage for sucess in the emerging telecommunications boom.
Happy New Year
rb |
