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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: Techplayer who wrote (60174)	2/26/1999 1:33:00 PM
From: The Phoenix	Read Replies (1) \| Respond to of 61433

Brian, Re: well, if you read the reports they site slow sales (not revenues) in January as a reason for the downgrade. What's interesting is they also cite lower prices in DRAM as a reason for downgrading the semi's. Lower DRAM prices should soften the blow of pricing pressure in the boxmakers which would lead me to believe that revenues might slip but margins and earnings will hold (like DELL's last earnings announcement). Again, everyone is citing January and projecting from that.... who knows what will really happen. HOWEVER, if PC unit sales are declining ...that is NOT a good sign for the techs in general - regardless of what we know....analysts lump us all into a group. Re:ALA and ASND. ALA didn't originally leave CSCO and partner with ASND due to product lines...nor did they leave due to product lines. As far as I can tell these were business related decisions. ALA wants to be a player in data communications and CSCO didn't want to enable them...so they went to ASND. LU purchased ASND and since LU is a ALA competitor ALA was left to either go back to CSCO, or NT (another competitor) or???. Rumor has it now that they'll buy XYLN which seems to make sense. They can go back to CSCO but I don't think CSCO will change the rules thus leaving ALA where they started....with no data story and no way to penetrate the emmerging converged IP markets. Tough spot to be in.... OG

To: Techplayer who wrote (60174)	2/26/1999 3:45:00 PM
From: Bindusagar Reddy	Read Replies (2) \| Respond to of 61433

Downgrading of the BOX makers is DUE TO DROP IN ASPs. They will sell 30% more boxes and make only 5-10% more in revenues. It is that simple. It will get nasty with price wars. It is inevitable when you (DELL)have nothing special to offer over the other(CPQ). The demand for PCS is robust and as healthy as ever and lower prices will continue to increase the growth of unit volume, may not increase dollar volume. It is great for networkers. More cheap cars need more expensive highways(Fiberoptics) and intersections(switches)gateways etc. BR