OT - The other view, for the sake of discussion.
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HEP,
>>to a fault.
That's interesting. Thanks. Perhaps others think that some occasional objective reporting is to a fault, also, only from a different perspective.
I find myself at a crossroads here on this topic of ATT acquiring the IBM network group, and then ATHM taking in ATT WorldNet ISP subscribers [which, presumably, encompasses a part or all of the IBM acquisition as well?].
But I'll expand on this for a moment, from the "other perspective," in order to stimulate further discussion.
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WARNING: Those who cannot stand a little bit of prose on a Sunday Evening that might happen to speak askew of hype and rah rah roar, please hit next now.
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As the principal of my own firm, I can immediately recognize and appreciate the value that bringing in additional volume from acquiring two more ISPs means. That is after all the end game, right? You betcha.
It's all about numbers and overall volume: the number of user accounts, the number of eyeballs, the number of hits per day, advertising revenues, referral and reciprocating fees, commissions on e-buys, the list goes on. Where I once had 300,000, I now have 3,000,000. I'm ten times better off.
That's from the perspective of the guy who has to pay the rent, and hopefully turn a profit when the cash register totals are in at the end of the day.
I turn my hat around about 90 degrees and suddenly I'm the chief engineer, another 90 degrees and I'm the overall broadband systems architect in charge of all ISP functions, and finally the last 90, and I'm the network operations and field maintenance guy.
We three now collectively say to the first guy...
"Hey! We thought we were scaling this baby for wideband, no, make that broadband, delivery, with a list of minimum stated criteria for entry. What are we going to do with all of these mountains of code, we're hardly done debugging it, most of it is still in development, never mind beta testing it, yet... and all of these relationships we've established with our business partners between these super-duper-hyper-links and streaming media servers... and all of these moving images and the audio stuff we had planned for next quarter's rollout commencement, Huh?
"What about the caching we just put in place for 300,000 users, soon to be 450,000 users under the current plan, in this list of locales? Now you're telling us that we're going to support how many users? in how many locales?
"Sure, we love the idea, Michael, it's really great, but it's going to take some T I M E to pull this whole thing off! How much time and how many bodies are you going to give us, keeping in mind that no one has ever done this kind of hybrid arrangement before on this scale?
"And you're telling us that we're supposed to service these piddly 28.8 slugs and these wannabe 56k snails that can only push 41.6 kb/s on a sunny day, as well?
"Hope some of that additional market cap we saw last month (assuming the aneurism doesn't pop before then) goes to picking up the new bodies we'll need, here's the list we'll need filled to do this thing properly, keeping in mind that there may be additional requirements, because we're really not sure, since this has never been done before.
"That's right, remember? We're the first at this? Can your market cap buy me the additional time that I'll need to do this right the first time, and stay on schedule for the next couple of quarters deployments, in untested territory?"
"And those cache sites that were strategically sited to satisfy the original growth projections for both number of users and payload increases? Forget about it. Out the window. Call in the additional engineers, because the ones we've got now are going to be busy working on the router reconfigurations for the next six months, and let's get a new strategy in place that will be relevant. Only, how long will this one continue to be relevant? Tell us now, otherwise we'll only have to go in again, and break it again, and start from scratch again."
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The foregoing would apply from my perspective "IF" I was concerned about this, but I'm not. But you can bet your boots, stock options and special signing bonuses notwithstanding, that these issues are on the minds of at least some of ATHM's current staff, and probably with good reason.
>>AtHome was already getting into non-cable-access, i.e. dial-up & ADSL, wouldn't economics of scale be automatic?<<
To the best of my knowledge, ATHM was only into dialup and ADSL in the @Work model until recently. I don't think that they had earlier seriously considered it in the residential sector for regular ISP access. If I'm wrong about this, please enlighten.
>> Why reinvent the wheel when Worldnet already has this type of access?<<
They don't, at least not to the best of my knowledge, not on a regular universal offering basis. Again, corrections welcome.
>>Also, it will make migrating subscribers from Worldnet to AtHome seamless. Keep the same customized home-page, the same web-page, the same e-mail address, be billed the same way ... etc, etc...<<
Go back three steps and re-read my comments re the architectural issues.
>>Wait a minute ... what profits? <<
If they pooled all of their ISP functions, maybe they could remove some redundancy, eliminate duplication, get best of breed in different areas from each, maybe there would be some normalized profits from the combination earlier as opposed to later... certianly the line rental costs would be more favorable, if that's what the bottom line called for. I don't know at this stage. There will probably be charges taken for these acquisitions and start up costs (for integration and a good deal of on the spot re-engineering), as there is often some up front breakage in these sorts of exercises, whether they be personnel related, or facility and platform related, before benefits are realized.
I haven't seen an analysis of this, and I sure don't have the inside information to do one. Not at this stage, at least.
Armstrong is a smart guy who has been pushing the right buttons lately in the name of shareholder interests, and he's got an army of people working for him both from within T and from without, who I am sure are working on these answers as we type. Time will tell...
Best Regards, Frank Coluccio |
