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Technology Stocks : Harmonic Lightwaves (HLIT) -- Ignore unavailable to you. Want to Upgrade?

To: Hiram Walker who wrote (1913)	2/2/1998 9:58:00 AM
From: Phaedrus	Respond to of 4134

Hiram, Thanks for the articles.

To: Hiram Walker who wrote (1913)	2/2/1998 11:53:00 PM
From: John O'Neill	Respond to of 4134

Hiram.. What kind of stock performance would you questimate for HLIT 1n 1998?

To: Hiram Walker who wrote (1913)	2/3/1998 1:34:00 PM
From: John O'Neill	Read Replies (1) \| Respond to of 4134

Hiram Today Echo Star announced a new service that would compete with cable at low cost. The cable industry says it's unfair because ES would not be bound to carry all local channels as is the cable co. The article stated that the govmnt is supporting approaches that would provide more competition for cable Do you think this will affect HLIT ?

To: Hiram Walker who wrote (1913)	2/3/1998 2:22:00 PM
From: Smilodon	Read Replies (4) \| Respond to of 4134

Notes from a visit with the company. The company has a lot of new products for 1998. However, the headend products will only account for 5-10% of their business and will be concentrated in other countries. They just recently started shipping to some of them. The bulk of sales will still be optical transmission and reception. The company was hurt by the slowdown in US spending as well as a slowdown by their major British customer, Telewise. Their Asia exposure is China, Hong Kong and Japan which has not been hurt that bad. Japan is seen as an area of good future opportunity. Main competitors are Scientific Atlanta and General Instruments. HLIT has better technology in terms of specs and ease of use, but GI and SA are able to bundle their optical equipment in an entire system for agressive pricing. They also have longer term relationsips with the operators, which gives them an edge. Result is the large component of foreign sales for HLIT. TCI is expected to agressively increase spending to catch up with others after a slow 1997. However, the large turnkey projects being bid now are unlikely to go to HLIT. The later system integrator and company buildouts are better prospects. Q1 is seasonally slow due to cold weather in the Northeast. Otherwise, business is patchy. There is now visibility for Q1. The company is changing its pitch to investors as a broadband access enabler to capture some of the excitement over cable modems. They will debut this slant at the Robertson Stephens conference in February. IMHO, don't expect good news in Q1. I think the company's success this year will depend on continued HFC buildout, not cool new headend products. It is a bet I am willing to make. I have taken a full position on the company at this time, but am prepared for a few rocky months. This is not an investment for the faint of heart, but has good upside potential as it is cheap and right in the middle of good long-term industry trends.