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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Stormweaver who wrote (22294)	5/6/1999 9:17:00 PM
From: John F. Dowd	Read Replies (1) \| Respond to of 74651

James: This provides a good summary of MSFT's ventures into big pipes: SEATTLE, May 5 (Reuters) - Microsoft's $5 billion investment in AT&T Corp. culminates two years of aggressive spending aimed at speeding deployment of a new generation of high-speed video and data services. Here are the biggest deals: June 1997 - $1 billion for 11.5 percent equity stake in No. 3 U.S. cable provider Comcast Corp . August 1997 - $425 million to purchase WebTV Networks Inc., provider of hybrid Internet service delivered over television screens. June 1998 - $212.5 million for 10 percent stake in Road Runner, a joint venture of Time Warner Inc . and MediaOne Group Inc . aimed at delivering high-speed Internet access to the home. December 1998 - $200 million for a 1.5 percent stake in Quest Communications International Inc., No. 4 U.S. long-distance provider. January 1999 - $500 million in convertible preferred shares for a 5 percent stake in NTL Inc ., Britain's No. 3 cable provider. January 1999 - $300 million investment in initial public offering of United Pan-Europe Communications N.V. of the Netherlands, establishing joint projects to deliver Internet, telephone and other services in Europe. May 1999 - $5 billion for AT&T convertible trust preferred securities and warrants. In addition Microsoft agrees to purchase 29.9 percent of Britain's No. 2 cable operator Telewest Communications Plc in a stock swap JFD

To: Stormweaver who wrote (22294)	5/6/1999 9:43:00 PM
From: RTev	Read Replies (2) \| Respond to of 74651

"...it has secured a pretty dominant position in this marketplace, both on the server and client side,'' said Scott McAdams I think McAdams overstates things a bit. They've bought themselves what could be called a "prominent" position, but far from a dominant one. But one has to be impressed with Maffei's negotiating skill in pulling this off. One must also stand in awe of Armstrong's skill at putting the whole group of deals together. News.com has a few recently updated analyses of the MSFT/T deal. In this one, they argue that CE probably isn't (yet) the best OS for settop boxes: news.com But, in spite of the technical problems that were partly to blame for its limited acceptance, today's deal gives Microsoft far more clout in the market than they would have had, and gives it the time it needs to fix the technical shortcomings of the system: news.com In this SmartMoney story, the writer argues that Microsoft faces many hurdles before it could become dominent in the market: smartmoney.com Even with five-million set-tops running Microsoft's CE product, there's a market of roughly 68 million cable subscribers in the U.S., by most estimates, and 103 million television households, which is basically the "addressable market" for the cable folks. (Cable passes about 90% of those households.) That leaves a lot of set-tops for Microsoft's competitors. One can find another of the many analyst takes on the deal and a significant comment from Armstrong in this MSNBC story: msnbc.com “This is Microsoft's business to win or lose,” said Lehman Brothers analyst Blake Bath. “And assuming that they really do have the kind of link that they say they have, and commit to deploying this very, very aggressively — if they prove themselves a good partner, it seems like they will have vast majority — if not all of — the business.” That's a claim Armstrong strongly disputes. “This in no ways dulls or diminishes our enthusiasm for Java for Sun's inclusion,” Armstrong told CNBC. “What this does do is speak to the reality of the rollout of what is ready. And what's ready today is the Windows CE that permits us to deploy set top boxes.”