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

To: DubM who wrote (5723)	5/5/1998 12:05:00 PM
From: SteveG	Read Replies (1) \| Respond to of 12468

WCII Competitive threats: Remember that WCII is primarily a CLEC. Their MAIN market is an alternative to ILEC voice. They also will provide highband data services as these techs mature, but this isn't currently the target market. IMO, cable's enterprise/voice threat is significantly less than from the ILECs fiber approach - with less money than an ILEC (though helped by Gates) cables are trenching for HFC, installing 2way switching at the cable CO, and will need to test and install cable/IP voice capable products. Data is the same, but in place of voice, ATM access (or some IP form of QoS) will need to be integrated. ADSL is strictly a broadband copper tech. It cannot be muxed for voice (though this is what RBOC HDSL and HDSL2 have done for a good while, but at prices only somewhat less than traditional T1 links). But to the extent there are instabilities with copper (bridge taps, load coils, crosstalk, radio interference and a generally old and decaying copper infrastructure), wireless is the low cost alternative (to both the lacking physical plant and RBOC monopolistic pricing) that provides quality voice and data bandwidth. In short, HDSL is just an ILEC alternative to T1s, cable is a minor threat and ADSL is a non-threat. Steve

To: DubM who wrote (5723)	5/5/1998 12:06:00 PM
From: Bernard Levy	Read Replies (1) \| Respond to of 12468

Hi Dub and others: Regarding the competition offered by cable and xDSL: a) As far as I am aware, two-way cable requires HFC cabling, which represents only about 20% of the cable plant nationwide. With ordinary coax, you need a telco return, which is not too attractive. I am aware of research on trying to send a return signal on coax, but these cables are terribly noisy, and the return capacity would not be large. b) Regarding DSL competition, ADSL is not a credible competition, since it is asymmetric and highly inadapted to business needs. The threat would be from HDSL, and later HDSL2 (which will offer 1.5Gb/sec in both direcions on a single twisted pair). However HDSL2 modems are only under development, and I do not really think that pricewise HDSL2 will be competitive with wireless T1 with point to multipoint technology Remember that the telcos are getting huge revenues with their T1 lines. If they were to roll out HDSL2 at prices which would compete with WCII, their revenues would get a big hit. Ultimately, this is probably a bullet they will need to bite. However, this can only occur if they are allowed to expand into long distance, so that they can trade increased long distance revenues against lower local business revenues. The bottom line: cable and networking companies have good PR, but this will never replace a cost advantage. Best regards, Bernard Levy