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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Boplicity who wrote (127746)	5/21/1999 6:47:00 PM
From: D.J.Smyth	Read Replies (1) \| Respond to of 176387

Greg speaking (specifically) relative to your earlier broadband statements. The argument for increased bandwidth (broadband or wideband spectrum use) relies heavily on the xDSL vs. Cable modem methodology for increasing internet speed, availability, receptivity, etc. Without increased bandwidth, internet expansion becomes limited. With it, the sky is the limit. if I can achieve improved internet access through cable (over the box), the role of the box (computer makers) is limiting. If I achieve improved access through the box (over cable), then cable is limited. Simplistic overview to get to a point: increased bandwidth is a must for extended explosion of the internet. And THAT technology which more cost effectively addresses the increased bandwidth issues becomes the overall winner. As you know, Europe/Asia (Japan in particular) charges for internet connectivity through cable/wireline is outrageous and has been seen as a significant limiting factor for box growth. (Dell's 29% growth in Europe was probably more a function of the market shying away from the connectivity costs (in finding a need to purchase a computer) rather than anything Dell did wrong - 29% growth in their current environment was actually astounding - comparatively speaking). What then can xDSL (a primary method of info delivery to the box)deliver vs. a cable modem relative to cost of installation and use for increased bandwidth in order to facilitate increased, low cost internet expansion in Europe? Most of the Telcos in Europe are wireline dependent and can't well afford addtl cost of optic cable lines to address expanded, low cost internet needs. Wireline dependent Europe is, then, better suited to the less expensive xDSL technology, which, by the way, is the current box methodology. xDSL is better suited because it (a) uses current twisted coper wireline structures which are already installed and (b) it can be easily intigrated with the wireless architecture. xDSL dependent wireless architecture is also partially depdentant on the success of the Wireless Local Loop - moving around the wireline dependent Telcos in general to connect directly to the box on the desk (bypass Telco connect charges) - and this is why the 3G debate becomes that much more important - increased bandwidth technology connecting wirelessly/seamlessly to the xDSL box on your desk. the xDSL based box becomes ESSENTIAL then (increased bandwidth with speed allows telephone and TV to run through the box), not a choice. Europe is 1 to 2 yrs ahead of the US in the wireless scene. So, once Europe establishes the xDSL technology meshed with 3G wireless (happening now) - the box becomes an essential technology fixture. The promise of the internet passing through optic cable to acheive increased bandwidth is no longer the norm there. Nor does the European Telcos need to expend $billions to lay more optic cable in order to achieve increased bandwidth. When I asked if you had ever known M.Dell to be predictable, I was merely stating that Dell has many avenues by which to exploit further box growth - (1) wireless expansion, (2) 3G involvement relative to setting up their own internet support/connectivity (why your MSPG comment earlier made sense and becomes essential to this type of move/thinking, actually), (3) product expansion relative to 3G involvement. The cable/box fight comes down to the success of 3G. AND WE KNOW 3G will be successful. There is little doubt about this. So, Euorpe resolves it's connectivity cost/3G wireless issues, the box in Europe booms. (This info, by the way, comes partially from people living there.) As stated earlier, much of Europe is nearly 2 years ahead of the US in the wireless front (estimated by some). The box, by no means, is static at this juncture, nor is Michael Dell's predictability as to what they are planning next. Kemble's ideas relative to listening to MD: maybe more of us should follow this method (I would have been richer had I done so all along). MD is well aware of the 3G issues facing the box and Dell has been preparing for these issues, I assure you. He was successful with his model with the box, what is the probability he will be successful in applying his model elswhere? Quite high I presume. You know Clark Hare from the QCOM thread (wrote a book on CDMA I believe). he gives a good, short, differential bw. cable vs. xDSL cost: Message 9507659 "Cable capacity vs DSL: Just out of curiosity I worked through some numbers. For internet traffic: 1) Assume that cable currently broadcasts to several thousand homes for each headend - call it 2500 homes per headend (a WAG). Also assume that they have 200MHz (about 30 conventional TV channels) to spare for ISP service. If you assume peak loading of 20% of homes on line of which only 10% are actually downloading at any given time that is still about 4MHz per user. (Of course not all MHz are created the same, but for back-of-the envelope purposes, ...) 2) For DSL the best rate will be less than 1.5MHz. Cable wins for internet traffic But for less bursty traffic, like video on demand: 1) Cable - same assumptions as before, but assume max usage is 35% of households and the burstiness is less. Assume that burstiness is 3 now instead of 10. Now the users each get about 700 KHz. 2) For DSL the best rate will be a little lower due to cross talk, but it will probably still be above 1MHz. Thus, DSL wins. But it should be noted that for a fairly small price cable can decrease the number of households per headend. Add an extra 2 or 3 headends and cable wins in both cases. The coax pipe is a big advantage. Note that, like you, I actually expected that the DSL would provide the higher rates until I did some calculations. FWIW Clark"