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[sharechat] Will TEL be worth buying if it goes below $6?

From:	Rhys Lewis <rhys.lewis@zivo.co.nz>
Date:	Mon, 4 Sep 2000 10:49:09 +1200

How much upside will TEL have if it drops below $6?

Is the IT/Telecoms industry going to settle down like the car/aeroplane industry (no real money in it for anyone, profits arbitraged away in ruthless competition), or will it be like oil industry (fat cat cartel)?

I think it's more likely to go the car/plane way. There will be a lot of money passing through the industry, but it will be v. difficult to extract a profit on the way. Usual story - in a competitive environment the price will deteriorate to the marginal cost. So you may be able to reduce costs with IT - but you can't get a higher long-term profit from the reduced costs because it's too easy for someone else to come in.

Bit of a rave for a boring monday morning...

Rhys Lewis

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