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Technology Stocks : Broadband Wireless Access [WCII, NXLK, WCOM, satellite..] -- Ignore unavailable to you. Want to Upgrade?

To: SteveG who wrote (127)	5/3/1999 11:18:00 PM
From: MangoBoy	Respond to of 1860

<< if these MMDS licenses with limited bandwidth for residential service in 6 cities are worth $210MM to FON, what valuation might that imply for WCII's LMDS spectrum (licenses only) in 100 US markets plus foreign? >> likewise ARTT.

To: SteveG who wrote (127)	5/4/1999 12:38:00 AM
From: Bernard Levy	Read Replies (2) \| Respond to of 1860

Hi Steve: The valuation you quote covers licenses + existing operations. I am not enough familiar with the extent of Videotron's operations to put a number on this second component. Also, keep in mind that the MMDS spectrum supports more bandwidth efficient modulation schemes and allows the use of cheaper equipment than the LMDS spectrum. Although I am willing to be as exhuberant as any other, my gut feeling is that wireless valuations are at the other extreme of what they were last October, i.e., enjoy while they last. Best regards, Bernard Levy

To: SteveG who wrote (127)	5/4/1999 10:04:00 AM
From: wonk	Read Replies (1) \| Respond to of 1860

Steve: As you know, the problem with coming up with a common value for the spectrum is the differences in frequency (attenuation due to precipitation and free space loss; effect on link budget from different antenna gains and transmitter power outputs, etc). As Bernard mentioned one has to take into account both the equipment availability and cost as well as the RF system design and forward-looking system architecture. The only way to even SWAG this is with two full blown DCFs, which would then be correlated with the comp sales. If one uses BT Alex Brown's liquidation analysis of CAI (contained in their bankruptcy filing) as a starting point, they (BTAB) basically made the presumption that 200 MHz at 2.5 GHz was equivalent to 1150 MHz at 28 Ghz and used the LMDS auction as a comp sale. (Given my first paragraph we probably could get into a wonderful debate as to the reasonableness of that presumption). Nevertheless, applying the "bump" in spectrum valuation from the Nextlink/WNP deal and adding a control premium, gets pretty close to what WCOM paid for CAI, assuming the only thing of value they were purchasing was the spectrum. I haven't even taken a cursory glance at the other transactions so I can't say if there is a consistent metric being applied. One final caveat which needs to be re-emphasized about MMDS: a majority of the channels are ITFS, leased by non-commercial entities to the MMDS companies. Hence, without being able to look at the duration, terms and conditions of those lease contracts, a common sense argument would be that the actual worth of "encumbered" spectrum at 2.5 Ghz would be far less than the math would suggest as compared to free and clear spectrum at 28 or 38 GHz. But of course, fair market value is just that. FWIW ww