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

To: Brian Coakley who wrote (8336)	9/22/1998 12:46:00 PM
From: Steven Bowen	Read Replies (1) \| Respond to of 12468

"Regarding your negative interpretation of the remarks Rouhana made at the NBMS conference about 50% on switch and 30% on net, I'm wondering what makes you think these numbers may be an early indication of a so-so quarter." Hi Brian, From the NBMO conference; - "Mature" markets demonstrating excellent on-net conversion progress. In WinStar's five most mature markets (on average, 15 months old), WinStar has 50% of access lines on-switch and 30% on-net. In WinStar's most mature market, New York City (18 months old), 80% of access lines are on-switch with more than 50% on-net. ________________________________________________________________ It seems the same old story that we went over last quarter. I'd been also hearing great things regarding this quarter and the migration to on-net specifically. But 30% on-net is the same place the 5 "mature markets" were last quarter. Again, doing the simple math and taking out the "more than 50% on-net" for New York, and you get that markets 2 thru 5, all on line now around 15 months, are, on average, less than 25% on-net. Remember, New York was at 50% on-net after 12 months, and these cookie cutter markets are supposed to be duplicating NY's performance. Also remember, Chicago was one of their first markets, up now for over 15 months, and apparently is still not among the "mature markets". Also, San Diego and Newark "should" be at 50% on-net by now (although Newark may be included in the New York numbers). I'm not sure what to make of these numbers and how they'll effect the 3Q numbers. I'm hearing the backlog of lines waiting to go wireless is decreasing. Hopefully because they're going wireless and not just because they're cancelling WinStar (sorry, a kinda not funny half joke). But I'm not sure then why the on-net % isn't increasing. But I guess if you're signing up lines super fast and sign up 10 new customers for every three you put on-net, you'll stay at 30% forever (unless of course you're able to put your new customers directly on-net, which seems to be the focus of the company lately). I don't know all the specifics of the troubles of getting hub sites up, but obviously there has been a problem there. Hopefully they've overcome that, and the hubs installed by the end of the year will tell that story. I said I took Bill's comments as a warning since the numbers have not improved since last quarter, and clearly some were disappointed then. We had also heard that Nate had decreed these backlogged lines go wireless this quarter. It may be happening and it's possible that numbers hide the real progress. But I believe I had speculated that it would be nice to get these matures markets to 50% on-net this quarter, but I believe Bill warned us that that will not happen. (PS I'm not saying now that this is good or bad. I think there are other numbers that people are looking for that will be much more important, and in these areas they may be having a great quarter. The on-net % numbers can get to be a pretty clouded issue.)