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To: djane who wrote (53157)	8/29/1998 10:21:00 PM
From: djane	Respond to of 61433

Gary (OG) very bullish on ASND/LU merger (via LU thread) Talk : Communications : LU - Lucent Technologies \| Previous \| Next \| Respond \| Earnings \| To: William Hunt (3819 ) From: Gary Thursday, Aug 27 1998 9:49PM ET Reply # of 3839 Interesting perspective. You seem to feel the LU, through Bell Labs, can build what they need to compete in the new market in months what it's taken companies years to build and perfect....AND to win business from customers that are fully imbedded with and installing ASND products. Pretty simplistic view. Add to that the expertise and learned experiences from thost at ASND. ASND has found and fixed problems that LU isn't even aware of yet. The engineering talent alone is worth half of the $15B. THe customers are worth the other half. Let me add one other tid-bit. It's my firm opinion, based on conversations with a number of well placed folks that LU is held up in part on the expectation that they will buy ASND. If they don't LU will weaken. Yes, this is contrary to the NT/BAY annoucement. The street very much want this merger and sees it as a very positive positioning move for LU. To not purchase ASND would be a "bad thing". OG ___________________________________________________________________ Talk : Communications : LU - Lucent Technologies \| Previous \| Next \| Respond \| Earnings \| To: William Hunt (3822 ) From: Gary Thursday, Aug 27 1998 11:26PM ET Reply # of 3839 Yes William, I read that article as well. It is obviously written by someone that hasn't a clue about how complex these products are. LU has little experience in implementing packet based networks and to assume that the folks they have are so good that they can build products which companies like CSCO and ASND have taken years to architect is more than just naive. I agree however that I don't want LU to overpay. Still, this market moves to fast to wait a year until a home grown product comes out. By the time they get it done ASND and CSCO will have something better. In order to get a hold on the communications market you have to buy your way into it....ala CISCO. NT/BAY is a poor example. TOo much product overlap, suffering companies, etc. etc.. LU is strong and ASND is strong...in their own unique markets. As a CSCO long I'd hate to have this competition...and as a CSCO long I'd like nothing better since it'll be the only way LU and ASND can effectively compete thereby giving CSCO added incentive to innovate even more. OG _______________________________________________________________ Talk : Communications : LU - Lucent Technologies \| Previous \| Next \| Respond \| Earnings \| To: mrknowitall (3830 ) From: Gary Friday, Aug 28 1998 3:34PM ET Reply # of 3839 What announcement are you referring to? Note that both Cisco and ASND also have SS7 capabilities. Granted however LU is the incumbent here. Still having the ability to interface to legacy SS7 signaling devices - although clearly a fundamental requriement - gets you nothing unless you first have a packet based network to install...otherwise there is no churn...you have to have both! LU is currently behind their understanding of and in building marketable packet based environements and is even further behind (I believe) in building billing and other applications for IP networks. What I'm getting at is that the new networks are packet based and billing app's and signaling (SS7) although required must be adapted to these new packet based environments. ASND and CSCO have the basics in place (network infrastructure) and are now building/buying (Stratus, Lightspeed) these applications on top of their networks. LU has to come at it from the other angle which will likely lead them to realize that existing SS7 and billing applications need adaptation for integration onto packet based environments. I think it is this fundamental issue which has some believing that ASND and CSCO will get there first. In this market (as fast as it's moving) getting there first will be hugely important. The question is, is LU willing to take that risk or will they eliminate some of this risk by purchasing someone with the foundational knowledge to help them eliminate it. OG

To: djane who wrote (53157)	8/29/1998 10:24:00 PM
From: djane	Read Replies (2) \| Respond to of 61433

Worldwide Internet Adoption: Leaders and Laggards gartner11.gartnerweb.com Research Note Strategic Planning 18 August 1998 A. Roussel The speed at which the Internet is adopted around the world. will continue to vary. A country's economic development will be a determining factor - but not the only one. Core Topic Networking: European Internet Regulatory and Adoption Issues Key Issue How will international differences and regulations affect Internet development in Europe? Strategic Planning Assumption The gap separating leading Internet adopters - industrialized countries - and less industrialized but more populous countries will significantly decrease by 2002 (0.8 probability). While the Internet continues to grow at an exponential rate internationally, its penetration rate does not follow the same pattern in every country. Currently, countries with the highest number of Internet users are the highly populated industrialized countries (United States, Japan, Canada, Australia and Western European nations) as well as less populated countries that were early adopters of the Internet (Finland, Sweden and Norway). The United States still has an overwhelming lead in Internet adoption by business and home users, with about 54 percent of total Internet usage around the world (see Figure 1). But other industrialized countries are catching up in adopting Internet technologies. As a result, the U.S. share of Internet usage will drop to about 40 percent by YE2000 (0.7 probability) - the current 54 percent figure already represents a drop from 80 percent in 1991 and 65 percent in 1994. Also, by 2005, industrialized countries will be replaced in their overall share of Internet usage by more populous countries - such as Brazil, China or Russia - which are currently slowed in their adoption of new technologies by economic problems (0.8 probability). Figure 1 Internet Usage: Top 15 countries in 1Q98 Source: GartnerGroup Figure 2 shows our projected Internet adoption rate by country to 2005. Nations high on the growth curve (Type A) are those where a high GDP per capita - indicating a high level of industrialization - will continue to be matched by a high number of Internet users: in these countries, the population can afford such technological tools as terminals, modems and Internet access lines (these being required elements to use the Internet). In addition, these countries show a propensity to absorb other emerging technologies - such as VCRs and cellular phones - quickly. This cultural element, combined with the availability of capital to purchase technology, enables us to project that the Internet will continue to grow at a fast rate in these countries. Figure 2 Internet Adoption Worldwide: Projected Growth to 2005, by Country Source: GartnerGroup Next on the growth curve come Type B countries, which display high levels of industrialization but low Internet penetration. These are nations where the economic environment is favorable but that have traditionally been suspicious of incorporating new or foreign-developed technologies into their way of life - thus slowing mass penetration of the Internet. Type C countries have a different Internet development pattern. So far, their lower industrialization rate has slowed their population's access to the latest technology. However, we expect their situation to evolve quickly, because they are moving up the economic scale rapidly and they have recognized the importance of IT to spur economic development. For Type D countries, we differentiate between NICs (in Latin America, Africa and Asia) - where Internet growth will be closely intertwined with economic development - and less-industrialized countries displaying high IT growth (such as India and China). In the latter, on the one hand, because of the large size of the total population, overall Internet penetration in these countries will be low to 2001. On the other hand, taken as a percentage of the population having access to IT, Internet penetration will be equal or superior to that of industrialized countries (0.7 probability). As a result, we forecast that the fast-paced adoption of the Internet by the IT-oriented population will itself impact the overall economy in these countries, and even push it forward. In turn, this will enable more mass penetration of the Internet. Acronym Key GDP Gross domestic product NIC Newly industrialized country VCR Video cassette recorder Bottom Line: Multinational enterprises should keep in mind the various stages of penetration of the Internet in different countries when incorporating Internet access in corporate strategy. They should not expect to be able to implement intranets or reach potential customers via a Web page in Japan or France at the same rate as they would in the United States or Finland. Enterprises should adjust Internet deployment plans accordingly. This document has been published by: Service Date Document # EMU Implementations 18 August 1998 SPA-05-1935 Enterprise Network Strategies Europe 18 August 1998 SPA-05-1935 Internet Strategies 18 August 1998 SPA-05-1935 PRISM for Networking 18 August 1998 SPA-05-1935 Internets - Europe 18 August 1998 SPA-05-1935 Entire contents (C) 1998 by Gartner Group, Inc. All rights reserved. Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner Group disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner Group shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice. \| Gartner Group Home Page \| My Home Page \| Search \| \| Site Map \| Help \| Feedback \| Client Services \| Log Off \| IT Journal \|