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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: username who wrote (30252)	1/13/1998 11:28:00 PM
From: Sector Investor	Respond to of 61433

Read the books by George Gilder - there are several Microcosm, Telecosm, Life after Televison, and the Meaning of the Microcosm. Also Gate's The Road Ahead. Also read ALL the articles and links posted on this and the News Only thread. Important about large companies? A couple of things important to investors 1) Vendor loyalty and inertia is strong. If a company is comfortable with a certain vendor's products (think of UUNET-ASND), it doesn't matter for example that COMS or CSCO may at some point have a better product (this happens all the time as generations are leapfrogged, etc.). What matters is the long term strategic relationship (partners). If this bond is strong, COMS or ASND need more than a temporarily better product, or an incrementally lower price to replace the incumbent vendors and products. This is because the cost of retraining personnel, redoing procedures, restocking inventory, debugging glitches that didn't exist before, etc. is much higher than the savings gained. Besides if the main vendor is on top of their game, they have new generations of products in the pipeline, offer special incentives, add-on software features, etc. that keep the customers happy. Also, large companies are privy to things you and I don't know. For planning purposes (under confidientially agreements) certain key senior management and technical management will be "executive briefed" about the capabilities of those products still in development - and may even be providing design and feature feedback, long before the product even reaches Alpha or Beta stage. Therefore a new CSCO product, (such as the 5300) may not be as attractive as we investors think - compared to what they know of ASND's next generation product, etc. As long as ASND does their job on all fronts, R&D, sales, support, etc. and keeps that partnership strong, things like a temporary port density advantage, lower price, even a buggy software release will be overlooked. The buggy software does have to get fixed quickly, of course, but customers are not as sensitive to competitors as the ANALysts may think.