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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: John F. Dowd who wrote (22583)	10/8/1998 12:38:00 AM
From: joe	Respond to of 45548

John, >> If they don't do it now they will be passed by by cable cos. and wireless cos. This is a firstest with the mostest thing.<< You'd think that this would motivate the RBOCs to move faster, but it's not. It doesn't seem like any of the 'legacy' players are moving fast. Cable cos. are heavy in debt, and will have to get more in debt to fully deploy cable modems. xDSL is not that easy to get going for the RBOCs. Too many incompatibilities between them...not enough standards. And RBOCs themselves have to shell out big investment $$. Pricing for customers is not cheap enough, etc.... I'm sure the bandwidth will come around eventually, but I'm not holding my breath for cable and xDSL to come and sweep the market real soon. It will at least take another year. CIEN's technology is good because it can greatly extend the fiber capability that's already in the ground. But that doesn't cover the last mile to your doorstep which is the big problem. I think what happened to CIEN, is that Lucent, Pirelli, Alcatel, and others finally figured out how to make the WDM product themselves. Maybe it's not as up-to-date as CIEN's, but it's good enough for now. Plus these legacy telecom equipment guys have much better personal connections with the the big companies like AT&T, etc. and they can sell the entire range of services needed that complement WDM somehow. They can put a lot of pricing pressure on a smaller, one-product dependent company like CIEN. That's why CIEN was trying to team up with Tellabs, right? Somehow, CIEN just got very unlucky with that deal. Unbelievable! Seems to me, they will have to hope that demand picks up tremendously and then they can fit in somewheres. The last mile will ultimately be fiber...maybe they can create products for that niche....I don't know. Pretty bizarre when you think of CIEN going from $90 to $9 in a few months. The lesson I learned from that is a company shouldn't depend on one product, and a technological lead is only good for a short window of time. AND finally, the market can turn everything around upside down in a moments notice. >>Concerning the entire industry we seem to have two views emerging. 1. The analysts view- the market will not be growing 2. The industry view - the market is poised for huge growth.<< That's right. When Alcatel preannounced and so did Nortel, analysts started wondering if the industry is slowing. And that's why they're ripping up CSCO right now. Also it didn't help when FORE preannounced and I think they said a few weeks earlier that all was OK. All of a sudden there are doubts in the telecom sector. Just a few months ago, the telecom sector was buying up the Brazilian telephone company like hot cakes. Now, every investor wants to get out of Brazil ASAP. >>I don't know who can survive without being able to move data around fast whether it be trucking companies or advertising agencies. I can't believe that things are as gloomy as the analysts portray the outlook to be.<< Yes, I agree with that too. The good businesses are heavily reliant on the internet now. There's not a day that goes by and I don't curse the internet for being slow. Heck, a lot of our trades and online info are pathetically slow. But, something has been deeply shaken up for awhile. When everybody is scared to lend $$, the economy has a way of slowing up big time. I'm sure eventually, the telecom sector will be on fire again, because there's incredible demand for bandwidth. But at the moment, too many investor's prefer 4.8% Treasury Bonds instead of investing in more bandwidth for Telecom companies. >>So do you get out and get back in as it is easier to do so nowadays with minute transaction costs or do you risk more down drafts or miss an upward move because you were out?<< Yeah, that's the question we all have. Sometimes it's better to just preserve $$ than doing anything at all. And, it's especially tough when we're seeing that COMS is finally getting it together and be going up if not for market turmoil. But if the market tanks big time, there's not much we an do (unless you want to start day trading). >> But on a day like this I have to say COMS did all right.<< Yes, I agree. But it's only one day. If the market goes down big time, COMS will be dragged down also. Hopefully it will keep doing well and it will snap back faster than most when the market recovers. They should have a very good 3rd quarter, but if we really do get into a recession, who knows how that will affect COMS income. You know, after this morning, I was fantasizing that Greenspan was being impeached instead of Clinton. Greenspan has stopped at least a dozen good rallies in the last 1 1/2 years. Ah, it's getting late, tomorrow's another day....