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Technology Stocks : PC Sector Round Table -- Ignore unavailable to you. Want to Upgrade?

To: Stitch who wrote (184)	3/30/1998 12:27:00 AM
From: Frodo Baxter	Respond to of 2025

On the topic you posed, I don't have any answers. But I do know a few things. a) Nature and capitalism abhors a vacuum. Anything that is marginally profitable will draw in competitors faster than you can say "monopoly power sucks." b) As information tech takes over more and more of the economy, it will have a profound disinflationary effect as far as Gordon Moore's eye can see. c) The future is terrific. Why be bearish? Ever?

To: Stitch who wrote (184)	3/30/1998 4:07:00 AM
From: LK2	Read Replies (1) \| Respond to of 2025

There is a practical problem in investing in long-term, projected future trends: it's not an easy or reliable way to make money, for the average investor. I'm talking about practical, real-world experience, not Wall Street exaggerations, etc. Please read my post Message 3586655 If you read the book, The Intelligent Investor (by Ben Graham), he covers the problems of trying to invest in industries that are projected to experience strong revenue growth. He used the aluminum and airline industries as examples, to show why an average investor can't reliably invest in growth industries (the aluminum and airline industries were considered to be growth industries during his day). You certainly don't have to agree with his conclusions, or his strategy of buy value at a cheap price. But Graham was a Wall Street professional, he had a thorough understanding of how Wall Street worked from personal experience, and he wrote simply and clearly in The Intelligent Investor. By saying he was a Wall Street professional, I mean he came to Wall Street in the 1910's or 1920's, and worked on Wall Street until he retired. He wasn't a broker at Merrill Lynch or some other brokerage (a broker, sales representative, account executive, or whatever they call them today, is really just a salesman). He ran his own investment operation/business. And he wrote a book, Security Analysis, that is credited with laying the foundation for modern security analysis (fundamental analysis, not technical analysis) that is used today. ======= To give a more current example of the practical problems of investing in growth (stocks, industries), think back to when Apple Computer went public, around 1981. I don't know if you were in the stock market at that time. But if you were, and you were following the PC industry, how many of the personal computer-related companies that zoomed in price are still around today? Most of the personal computer-related companies went bankrupt, or were acquired. The only publicly traded personal computer maker from that time that is still large is AAPL (I'm not counting IBM). Tandy was a stock that zoomed on it's personal computer prospects, but as you know, a few years ago they got out the PC box making business. And when TXN decided to exit the personal computer business and take a huge write-off back in the early 1980's, the stock went up, what, 50%, in a few months. What happened with the disk drive makers also happened with the other parts makers, and that's the normal way these businesses work. And the stock price behavior is normal as well: a particular industry's stocks zoom because Wall Street talks about how wonderful the future prospects are, and then it's on to the next bright industry, and anyone left holding stock in the previous darlings will have a hard time getting his money back. Amgen was the winner in the biotech run in the early 1990's. And if you held Amgen from then until today, you'd be OK. But if you had held XOMA or a bunch of others from the early 1990's until today, you'd be stuck with massive losses (from their peak prices). It's not easy to pick the few actual companies that will survive, let alone prosper, if you are choosing from the small capitalization arena for a sector that Wall Street is currently promoting as its hot growth industry/sector. Best regards, Larry PS: I know Peter Lynch recommends investing in industries/companies that you work in, but he makes it sound easier than it really is. PPS: On the other hand, in many ways, the stock market is also generous, and it will let you make mistakes and still have a good chance of making money (just not as much as you'd like to make).

To: Stitch who wrote (184)	3/30/1998 10:47:00 AM
From: appro	Respond to of 2025

Thought provoking discussion here. Assuming the PC/Internet becomes ubiquitous in every aspect of life, Sony sees the future this way: >>"Sony has learned a lot from the first year of its experience," Arlen said. "They've been among the first to really figure out how advertising works in this venue and the format lends itself to all kinds of other revenue streams."<< cnnfn.com : (

To: Stitch who wrote (184)	3/30/1998 1:53:00 PM
From: Mark Oliver	Respond to of 2025

Did you happen to see Bill Gate's book The Road Ahead? It takes some assumptions about developments in wireless high speed networks, shrinking computers, secure money transfers, easy interfaces. Puts some interesting twists on commerce, education, liesure and work. Obviously, you can see Bill is spending toward these goals. Perhaps you could say an investment in Microsoft is buying into today's systems and all the future applications. After all, they have equity stakes in many leading edge companies as well as a monumental internal R&D. I've had some very good luck lately with Axent AXNT, which provides security. Lernout en Hauspie LHSPF have interesting applications around speech and language that make the internet more accessible. General Magic GMGC has some interesting projects going to create a personal assistant that you can use with a mobile phone based on voice recognition. Microsoft has taken positions in both these companies recently. LHSPF will probably be integrating products into Windows CE for speech. Then, you'll need to look into ways of payment. Micro debits are the important. These are charges of less than 5 cents. These could be used for viewing documents. Many companies are offering magazines for free over the net, but charging for hardcopies. How long can that last? If the recently discussed Internet Explorer 5, or code name Chrome describes new coding to down load 3d and video from the net as fast or faster than we get today. They describe advertising quality that will rival TV. Harmonic Lightwave makes infrastructure gear for developing Hybrid Fiber Coax networks for companies like TCI and MMDS/LMDS wireless cable. These services will offer transfer rates from 10 Mbps to 50Mbps. Most of them don't need to be turned off, so internet use becomes radically different. I often wonder about selling across borders. I buy a Dell computer in California and I don't have to pay sales tax. That puts some pressure on the local PC store. Actually, I'd like to order a Dell computer from Australia, or some other artificially high price country, but most of these companies still have special prices for the countries you buy from. How long will that last? I suppose you can learn a lot from watching Amazon.com and read their reports. They have probably developed one of the most visible success stories for selling goods. Certainly, distribution will change. Federal Express has put into place some interesting formats for warehousing and distribtion. You are right, there are issues beginning today, and those that will play in the future. From an investing standpoint, stocks go up on hype as much as reality. Look at AOL. The still don't make much real money, but look at their subscriber growth. I think there is an interesting trend today where consumers are buying computers. What software and add on gear are they buying to support these purchases? While hard drive sales have been hurt, software sales look like they should be a great buy. Again, you come back to Microsoft and ask what's going to stop these guys? Regards, Mark PS I wish I hadn't switched my pruchase 2 years ago from Microsoft to Motorola at the last minute because I thought 40 PE was a little high. I still worry that MSFT is too expensive. Will I ever learn?

To: Stitch who wrote (184)	3/30/1998 2:42:00 PM
From: Yogi - Paul	Read Replies (3) \| Respond to of 2025

Stitch, The most investable trend, IMHO, is the convergence of digital Television and the internet. I am of the opinion that the classic PC is rapidly approaching market saturation. Entertainment, gaming, and communication will be powerful draws for computer type devices such as internet enabled set top boxes and internet enabled telephones. Digital TV via cable will enable micro target marketing right down to the individual level. Dad, in his study, sees an ad for Fidelity while Junior, in his room sees an ad for Hasbro and both are watching the same program. (See link) biz.yahoo.com Individual companies? I can only tell you what I own in this area. Sony-- Recently took a large position-- General Instruments- This company has a remarkable ability to avoid making money. Have a small position in case they learn. TCOMA--Hell of a debt load but they are in the right place at the right time. I have moderate size position. Oracle-- small position Do you happen to know, who makes UPS trucks and the electronic "clipboards" the drivers carry? irthrifty

To: Stitch who wrote (184)	3/30/1998 7:09:00 PM
From: Kurthend	Read Replies (1) \| Respond to of 2025

Stich, Two areas I think will be in high demand in the future are speech-to-text (and vice versa) and home-to-bank banking. Speech-to-text I believe will be in high demand once the kinks are worked out. A good site to learn a little about this is located at: geocities.com The home-to-banking industry should take off (at least in the U.S.). The problems in this area (that I can see) are compatible software between the banks and home users and the area of firewalls (ie security). The problem now is researching all of the companies involved in these industries:) Kurt

To: Stitch who wrote (184)	4/1/1998 1:13:00 PM
From: Pierre-X	Read Replies (2) \| Respond to of 2025

Re: Cabbages and Kings Well that's quite a can of worms (or barrel of monkeys depending on your Prozac dosage <g>) that you've sprung in this post. You said: ...many more people will presumably know how to use a PC. Whats next? Does this increase in literacy auger well for other forms of information processing? Increasing digital literacy benefits everyone. The personal computer is the most powerful form of human self-augmentation since the printed book. The PalmPilot and Windows CE are the first steps in the right direction. You said: What sort of convergence scenario is going to happen? Will we compute with hand held personal communicators? We will have those, but we will have everything else as well. The lesson of the PalmPilot has been that users don't want to REPLACE the power on their desktop -- but they do want to SUPPLEMENT it with a portable extension. On the other hand, those parts of the world that dont have electric infrastructure need a power-efficient device. You said: How about shopping, will we ever really have to go to the mall? Yes. The mall embodies a social and glamour atmosphere that can't replicated in cyberspace. Yet. You said: We are already seeing explosions in on-line shopping. Only in certain areas which lend themselves to direct transactions. The catalog mail-order business will eventually recede to nil when electronic bandwidth and latency draw near to printed materials. You said: Will the need for a much wider dispersion of delivery points (to everyone's home and office) auger well for UPS? Federal Express is one of my largest holdings. <g> Increasing point-to-point distrbution is a no-brainer. UPS is privately held, and isn't run well IMHO. You said: How does all this match with the aging of the U.S. and Japanese population? Remote medicine? I just spent the last few days basically living in a hospital, taking care of a relative. Incidentally, that's why I haven't been here. I believe computing is the key to unlocking vast underutilized human resources in aging, semi-skilled populations. Computing doesn't require physical strength or mobility. Computing can be adapted for poor vision (here's another killer-app for AUI) and for poor manual dexterity (another one). One thing I noticed in the hospital is a relatively low technology level. This is probably the predictable result of regulatory forces damping progress. You said: How about machine verification of signatures? ...remote signature entry... What companies lead the pack in online security? Well if you think about it, electronic identification mechanisms obviate the need for signatures. Electronic verification systems are definitely a visible phenomenon of the future, beginning with credit card fraud defense. Ball's in your court now <g> God bless, PX