mailing list archives
RE: peering charges?
From: "Eric D. Madison" <madison () acsi net>
Date: Wed, 29 Jan 1997 23:35:59 -0500
Well, that's not exactly true, UUNet nor PSI show "profits", they show
substantial Revenue. Revenue will cause Wall Street to favor your stock
even if you don't show real profits. The only company in the Internet
business that shows real profit is Cisco, and they are laughing all the way
to the bank. Of course vendors always have higher profit margin than
Here is a financial statement for PSI:
Their revenue is up tremendously but their bucket has a big hole in the
bottom as does most other providers. Capital expenditure in this business
is just so high.
Corporate Performance 1995 1994 1993 1992 1991
Revenues ($Mil) 38.7 15.2 8.7 6.4 4.7
Net Profit ($Mil) -53.2 -5.3 -1.9 0.4 0.2
EPS -1.78 -0.26 n/m n/m n/m
Net Profit Margin (%) -137.3 -35.1 -22.1 6.7 5.0
UUNet info wasn't available because of the Merger.. their ticker doesn't
show up anymore. I know they did not show profits because just before
their merger I looked at all of the big players stock to see if there was
anymone actually making money, and none has positive profits or margins.
At 02:56 AM 1/29/97 -0800, you wrote:
From Danny Stroud <dannystroud () msn com>:
Don't harangue me about it. Ask Wall Street, look at the numbers for the
read the paper regarding the latest AOL flap. This is not my sole opinion. I
will not engage in a philosophical debate on this issue. Sorry, but the
market is the judge. des
He. UUNET and PSI show profits even after lots of money spent
on expansion. Zillions of small ISPs which "resell" UUNET's and PSI's
services are profitable (or they'd close the shop long time ago, because
they generally have no cash reserves, and no VC funding). Sprint
and MCI do not show profits on Internet side, but their leased line
business is _very_ healthy because Internet sells those lines.
If anything, telcos provide equivalemt of 64Kbps digital service to anyone
for the same $20/mo and are not particularly bankrupt.
One has to be completely insane to call the industry with nearly decade of
than 100% annual growth "not economically viable". One has to read way
creative economists (of statist camp) to believe in anything like that.
those economists missed the entire new industry. Now they pretend it doesn't
exist or offer moronic suggestions on how to "fix" it. How nice, but we've
already seen exactly that scenario with PCs.
PS AOL "flap" is a typical example of blatant incompetence.
Their marketroids never heard of market pilots, or something,
to measure response before doing something really drastic.
If AOL will go under as a result, they won't get a lot of sympathy.
PPS What figures? I've certainly seen a lot of creative accounting,
when, for example, network build-up is counted as operational
expense (Sprint used to do that), whereas all sane people count it
PPPS Wall Street who? I guess not the people who valued UUNET at $2B,
P S May i politely suggest reading some books on the early history of
telephony before writing nonsense? Fortunately, they had fewer
economists and lawyers back then (though, Bell had to defend his
patents against 576 suits).
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- Re: peering charges?, (continued)