This may explain some of what we are seeing today.
***************
Special Wireless edition of The Wall Street Transcript
BusinessWire, Thursday, November 05, 1998 at 12:09
NEW YORK--(BUSINESS WIRE)--November 5, 1998--The Wall Street
Transcript has just published its annual Wireless issue containing a
25-page focus covering the sectors. Vital reading for investors and
companies in the sector, it features:
1) An in-depth roundtable discussion featuring John Bensche of
Lehman Brothers; Jeffrey Hines of BT Alex. Brown; Thomas Lee of
Salomon Smith Barney; Eric Weinstein of Donaldson, Lufkin & Jenrette.
The panel sees low impact on growth from the economic climate, as
Hines says, "There is not a strong correlation between wireless
subscriber growth and economic growth.." He adds that growth is also
being spurred by new pricing plans: "It's simplified the whole pricing
scheme, and lower prices that make the whole package much more
competitive. And that is one of the many factors that's going to help
drive the penetration, going forward." Challenges in the sector,
however, come from competitive pressure, where Lee notes "you're
really talking about six or seven players per market for a sustained
period." Also for the newer PCS companies, Bensche thinks "it's going
to be tough to raise capital in the public markets for expansion of
PCS networks."
This distinguished panel discusses every aspect of the wirless
industry, including the tower business, point-to-multipoint
technology, C-block licenses, pricing plans, voice quality, FCC
regulations and the cutting-the-cord phenomenon. Weinstein states:
"The reality is, we're taking baby steps toward the eventual
replacement of wireline by wireless. The forecasts haven't really
changed that much. We still look for 21% penetration at the end of
last year going to 58% penetration by 2007."
In making investment recommendations Lee says "we'd first look
for names a) that are very well-capitalized, given the liquidity
crunch that we've talked about, and b) that either have a competitive
niche or product of differentiation, or just aren't seeing the high
levels of competition." Stocks recommended include , AirTouch
Communications (NYSE:ATI), Cellular Communications of Puerto Rico
(NASDAQ:CLRP), Crown Castle Intl (NASDAQ:TWRS), NEXTEL Communications,
(NASDAQ:NXTL), Price Communications (AMEX:PR), Western Wireless
(NASDAQ:WWCA). Hines recommends the smaller companies: Advanced Radio
Telecom (NASDAQ:ARTT), Teligent (NASDAQ:TGNT), and Winstar
(NASDAQ:WCII). Canadian stocks liked include Clearnet (NASDAQ:CLNTF),
Microcell (NASDAQ:MICTF), Rogers Cantel (NYSE:RCN). For the
"high-risk-tolerant people" Bensch suggests Globalstar Comm.
(NASDAQ:GSTRF), Omnipoint (NASDAQ:OMPT),
2) A confidential review of management performance at 19 Wireless
companies by analysts, money managers and industry experts. "The
problem with wireless in general is that quality management teams are
few and far between and you can name them on one hand. AirTouch is
always at the top of the list," says a specialist. High marks also to
Western Wireless, who one buysider calls "probably is the only team
that could actually rival AirTouch in terms of the quality, the
people, and the strategy of the company." Praise also for management
at Alltel (NYSE:AT), Lucent Technologies (NYSE:LU), SkyTel
Communications (NASDAQ:SKYT) and Vodafone (NYSE:VOD). However, one
firm's management is criticized for producing "a churn rate that is
horrendous." Vital insight for investors.
3) An related interview with Kenneth Kannappan of Plantronics
(NYSE:PLT), in which he talks at length about the company's position
as the world leader in communications headsets for the past 37 years.
"In fact," he recalls, "the historic words of Neil Armstrong, 'One
small step for man, one giant leap for mankind,' were spoken while
using a Plantronics headset."
Other companies mentioned in this special focus are: Aerial
Communications (NASDAQ:AERL), American Tower (NYSE:AMT), AT&T
(NYSE:T), Bell Atlantic (NYSE:BEL), BellSouth (NYSE:BLS), Boston Comm
Group (NASDAQ:BCGI), Brightpoint (NASDAQ:CELL), Cellstar
(NASDAQ:CLST), Cellular Comm Int'l (NASDAQ:CCIL), Century Telephone
Enterprises (NYSE:CTL), Comcast (NASDAQ:CMCSA), EchoStar
(NASDAQ:DISH), ICO Global (NASDAQ:ICOGF), Iridium World Comm Ltd.
(NASDAQ:IRIDF), Metromedia (AMEX:MMG), Millicom (NASDAQ:MICCF), Nokia
(NYSE:NOKA), Orange (NASDAQ:ORNGY), Paging Network (NASDAQ:PAGE),
PanAmSat (NASDAQ:SPOT), PowerTel (NASDAQ:PTEL), Sprint (NYSE:FON),
Telephone and Data Systems (NYSE:TDS), Vanguard Cellular
(NASDAQ:VCELA), Vimpelcom (NYSE:VIP).
For a copy of this complete issue, which also contains interviews
on other topics with analysts, money managers and CEOs, call Robert
Ruffin at (212) 952 7433 or use the web at
secure.addy.com. There is a $175 charge
for the issue. The Wall Street Transcript does not endorse the views
of any interviewee nor does it make stock recommendations.
The Wall Street Transcript is a premier weekly investment
publication serving serious long-term investors for over 35 years. The
Transcript publishes industry roundtables and interviews with Wall
Street analysts, money managers and company CEOs, and is read by top
money managers, brokers and individual investors. For subscriptions
information call (800) 246 7673.
The Wall Street Transcript twst.com (800) 246 7673.
CONTACT: Andrew J. Pickup
Publisher & CEO
The Wall Street Transcript
pickup@twst.com
(212) 952 7437
KEYWORD: NEW YORK
INDUSTRY KEYWORD: TELECOMMUNICATIONS PUBLISHING
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