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Technology Stocks : Winstar Comm. (WCII) -- Ignore unavailable to you. Want to Upgrade?

To: wonk who wrote (5463)	4/26/1998 4:02:00 AM
From: Jason Cogan	Respond to of 12468

JA: Finally a good post. Well reasoned, and certainly worthy of a response. Each of your points has merit, and is the type of discussion I was trying to stimulate. <<1. Cost per consumer of $20. sloppy Winstar is targeting businesses. The nationwide average cost per employee for telecommunications service is approximately $75 month + or -10%.>> Good counter. I am aware of who Winstar is targetting. I was not aware of the average of $75 per month. What source is that from? My contention is that average telecommunications pricing will come down with competition. But if it stays at $75 per consumer, so much the better for Winstar. It still means they have to get 7 million monthly customers, or 6% of the US workforce. It also rests on a lot of assumptions. <<2. 10K of 417 million cash. superficial>> I gave you my take on the debt offering in the last post. I agree that debt holders are not stupid. They probably do see some cash coming from Winstar in the future. But notice they want interest, and to be ahead of the stockholders in exchange for their risk. Where does that leave the share price? Worse, or better? <<3.< I frankly have no idea how to depreciate wireless equipment, and I'm sure the Winstar boys don't either.> Grade F>> You caught me being a little flip. Sorry for that. I wasn't alledging any overt fraud. Quite frankly, I hadn't delved into the depreciation section of the 10-K that deeply. They are depreciating transmission equipment over 5-10 years. Sounds about right, although with the current lanscape of telecommunications, it's hard to say. As for your final point, a discussion of valuation was all I was after. Please. By all means. Disagree with my assumptions. It will help us come to a better valuation in the end. But if you're going to pick apart my assumptions, don't you think we should pick apart Mr. Vogel's as well? Regards, Jason Cogan