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Technology Stocks : Qwest Communications (Q) (formerly QWST) -- Ignore unavailable to you. Want to Upgrade?

To: Digitom who wrote (803)	2/14/1998 2:09:00 AM
From: Phil Jacobson	Read Replies (1) \| Respond to of 6846

What's amazing is how this woman took information that was not only publicly acknowledged in Qwest's press release, but has been published in every 10Q and business plan filed with the SEC since inception. There's nothing new here. What Qwest did was build excess capacity into their network and then resell dark fiber to WorldCom, Frontier, and GTE. One could just probably call it "carrier service revenue" but I guess the accoutants wouldn't like it. Dark fiber is simply a fiber optic line where the customer owns the equipment on both ends. It's "dark" to the seller in that he can't see what kind of traffic the customer is putting over the network. What Qwest did is remarkably simple and intelligent as it allows them to be reimbursed by other carriers for a large part of their network construction by simply installing more fiber than they need in the initial buildout. They were not trying to hide this. In their SEC filings they have gone to great lengths to explain the strategy and even described their construction process in great detail because it is so innovative. When the time comes to add fiber they won't need any backhoes - the pipes are completely accessible all along the way at periodic points where a field tech can open a door (for lack of the proper word) and push new fiber through. I can't imagine there's an issue with the percentage of revenue that is construction instead of communications unless analysts and investors haven't read the filings. If analysts' recommendations and estimates don't assume some sort of transition from construction revenue to communications service revenue than they haven't been doing much analysis...even by Wall Street standards. I sold at $70 today simply to see how far down this "analyst's" childish excuse for a research article would take the stock. You never know, given Qwest's volatility it could have gone to $65. As I recall I don't think volume was terribly big so not that many people pressed the panic button. Saw that the stock closed at $67. Wish I'd been near my PC!! I'll be coming in Tuesday AM for twice as much as I had before if I can get in around that price. Once Qwest and the analysts that follow them respond there may be a big pop - if you're into buying calls, get ready to make some money on Tuesday. Hope a bunch of people took her advice and went short! Will be nice to watch them get squeezed like grapes. Phil