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Technology Stocks : COM21 (CMTO) -- Ignore unavailable to you. Want to Upgrade?

To: DZOO who wrote (436)	5/26/1999 2:29:00 AM
From: pat mudge	Read Replies (1) \| Respond to of 2347

You're right. To date, TERN has installed 655 head-ends and 100,000 modems. CMTO has installed 608 head-ends and 126,800 modems. If you do the math, you'll find TERN has installed 152 modems per head-end, to CMTO's 207. Each of CMTO's head-ends supports 2000 subscribers. I don't know how many TERN's support. While we're comparing companies, here's a segment from Terayon's most recent 10-Q: <<<< The market for broadband access products and services is intensely competitive and is characterized by rapid technological change, new product development and product obsolescence, evolving industry standards and significant price erosion of products over time. We have experienced and expect to continue to experience downward pressure on our unit average selling price ("ASP"). We had negative gross margins from inception until the fourth quarter of 1998. We achieved a positive gross margin for the first time in the quarter ended December 31, 1998. While we have initiated cost reduction programs to offset pricing pressures on our products, we cannot be sure that these cost reduction efforts will continue to keep pace with competitive price pressures or lead to an improved gross margin. If we are unable to reduce costs efficiently, our gross margin and profitability will suffer. Our gross margin also is affected by the sales mix of TeraLink 1000 Master Controllers to TeraLink Gateways and to TeraPro cable modems. The TeraPro modems have significantly lower margins than the TeraLink 1000 Master Controllers and TeraLink Gateway headend products. As a result, our gross margin also is affected by the maturity of TeraComm deployments in any quarter, because new deployments of the TeraComm system involve the sale of headend equipment (which has higher margins). In addition, new deployments generally involve smaller quantities of product, which typically are sold at higher margins than the larger volume sales of product associated with more mature deployments of the TeraComm system. For the foreseeable future, we expect to achieve only nominal margins on TeraPro cable modems. We also expect that sales of TeraPro cable modems will continue to constitute a significant portion of our revenues. As a result of these factors, our gross margins and operating results are likely to suffer in the near term. Our components are sold together as part of an entire system, and accordingly we do not report revenues derived from each component. >>>>