rmitz

I agree. I would say that the earnings were not as good as I had hoped, but about what I expected. I feel that holding right now has a pretty good margin of safety. I am somewhat hesitant to sell since this is also a massive position for me, and the capital gains bite will be huge. That said, if we lose the 15% LT capital gains at the end of the year, I will trim quite a lot. Maybe keep some around to use as donations. I was looking at the March options to do something similar as what you did, but I wasn't as comfortable with the margin of safety on them.

Just for the record, I HATE these kinds of places. I'm the guy that always parks the car and gets out to eat inside a fast food joint, because I can't stand to have food in my car...also, it's just so much more convenient and comfortable to be sitting at a *table* and relaxing somewhat.

I gotta say, I wouldn't touch this with a 10-foot pole, for privacy concerns. I don't like mint for the same reason.

I think there's another risk in the regulation of fees (or competition in general) resulting in lower fees and lower margins over time. That very benefit of cheaper technology doesn't just apply to Visa, it applies to everyone.

Seems like my knowledge of the international situation is somewhat dated. However, I still don't think that an idiot can run that business for long without significant negative consequences.

Not that I'd buy Microsoft, but frankly I wouldn't buy Wal Mart either. They've not really had any success internationally, margins are extremely thin, competition is fierce...it wouldn't take very long with lackluster management for Wal Mart to start looking a lot more like Kmart. Microsoft's moat (and profit margins, for that matter) is much, much larger in my view, even though it is deteriorating.

Perhaps once you stop writing in a style which is like a holier-than-thou guru, other people will be more likely to want to have a conversation. (On a different note, you and SD are talking past each other; you're referring to giving more weight to the *very* latest numbers, and he is saying that you should underweight the most recent few years which have been very profitable. Both actually lead in the same direction.)

Again, I'm talking about the technology, not the business. That article demonstrates exactly my point; hulu *can* use Akamai's technology. The fact that they're moving away from Akamai presumably means that at the moment, the other options are cheaper. That won't necessarily always be the case.

My meaning was that a lot of the content itself is not duplicated. On youtube, for example, a lot of bandwidth gets used up by videos only watched a few times...but there are many of those videos. Akamai is most valuable for people with content that gets viewed lots of times in lots of places. hulu is an example of exactly this opposite effect, where akamai would be helpful. The "long tail" phrase does not refer to the business of akamai at all.

I have to disagree with your assessment of Akamai. Not the company, but the technology in general. The company itself I believe has a very small moat, but in general the technology involved isn't so much about size of the data as it is about the repetition of the data. It's not that the video content is longer or larger, but that the content itself is mostly on the long-tail side of things. Sure, it'd be great for those video clips that are being watched by everyone a ton, but Akamai isn't going to help much with reading your email, since it's (hopefully for you) not being read by tons of people.

Your point works both ways. Younger people (who are becoming the decision makers) are going to be more open to non-microsoft operating systems in the enterprise as well. Office is a tougher nut, but it's still possible.

Agreed. Even applecare lasts for 3 years. Apple users tend to upgrade more often for, I think, two reasons: 1) Apple makes stuff worth buying to upgrade (techno-lust) 2) Target market is people who have the extra cash to spend on a higher quality product (easier to use or simply more sexy) That said, my mother still emails and does some web browsing just fine on her 6 year old mac.

Huh, interesting. My SWAG was that it would have to fall below $200 for me to actually start looking at it, so I'm glad to learn that it's in the ballpark.

I had pretty recently de-leveraged completely and today I took a nibble at a small issue. I'm not comfortable using leverage at this point, but if it goes down enough I hope I will be.

The obvious is what most people don't get.

In addition, the call alluded to other debt covenants they have that would prevent buybacks. We'd have to look at the exact debt terms, but honestly the planes might not be an entirely bad idea. I would hope that all the debt gets converted to longer term with better covenants. I trimmed my position very slightly recently just to take my leverage to 0.

I wrote in another thread, that IB will let you trade foreign positions in IRAs at this point if you do a manual forex trade to get the target currency, first. They also allow you to set up your account as "margin" so that you can trade positions without waiting for the previous trade to formally settle.

I can't disagree with your statement here, since I don't know what was deployed, but there's really no reason you can't upgrade the cables, or even splice older ones together. There also exist optical-only switches and other mechanisms now. Not really sure on the cost issue. Unless you're traveling over 1000 miles, the time delay in your route is pretty minimal, given that it's based on a factor very close to the speed of light. This becomes significant over planetary distances, but it'd have to be a pretty bad route for most situations to matter. If I did the math right, it would take about 5.3ms for light to go that 1000 miles. Your times are swamped by the optical conversion and other hops. Now, the one issue you bring up here which is critical is the idea that you use capacity from your competitor. If this means you don't have any physical way to get from point A to point B, this is very significant indeed. I need to reiterate that I don't really know what was done in terms of the technical deployment at the time, I'm thinking about what can be done given the resources available (plus cash). If I was to speculate as to why certain changes aren't being made, it's probably that they aren't yet worth the capital investment. Roman.

I can't answer this question definitively. The standard for the first type of single-mode fiber (Nondispersion-Shifted Fiber (ITU-T G.652)) was released in 1984. I don't want to stress the fiber part too strongly; the biggest and most difficult part to put together is the rights-of-way.

It's probably not really that bad. The most important things in building these networks are having the physical places (rights-of-way) to actually put your cables. Once you have those, rewiring specific sections isn't that bad. In addition, most of the network upgrades since fiber was introduced (though there are different kinds of fiber) happen at the device level. That is, you don't necessarily even need to replace your cables, but you can have an enormous increase in capacity by upgrading the electronics. Change happens extremely rapidly at that level. Level 3 would have had to make significant upgrades along the way to keep up with the other providers, even though their network was built comparatively recently. The long term stable money is in leasing physical fiber to other companies, or just leasing particular rights-of-way themselves. This would provide a reasonable return on capital without requiring huge and continuing capital expenses. I say this without going into any company's particular business model. Roman.

Apple does some things organizationally very well that other companies just don't do. The fanatical care about design, and fit and finish, *do* make a difference in the quality of the end product. (The lack of these things is exactly what caused the company to start tanking in the early 90s.) Fit and finish (ease of use, etc.) is what people pay money for, not because they're a bunch of fanatics. MP3 players were around for a long time before the iPod; why did the iPod become popular? Simplicity. It was simply much easier to use, and wasn't *huge* like so many of the other player products with a reasonable capacity at the time. Personally, I felt it was a flash in the pan at the time and hated it because it didn't have all the options I wanted. Turns out, Apple knows how to sell products to the masses better than I do. :) Simplify, Simplify, Simplify. Another aspect is that Apple will simply refuse to release certain products. If they worked on it internally and it doesn't meet their standards, and they don't know how to make it meet those standards, the project gets canned. There's a lot more concepts along these lines. Now, none of this is a moat (except in the case of corporate culture -- when Jobs is not in charge we will see how much of the culture sticks) or rocket science. But it is a real difference, and to copy it, Microsoft will have to change their entire outlook and culture.

Sure, that's their choice. I won't begrudge anyone that; personally, my goal is similar: to not have to work. I'd probably continue to work at a reduced level. But at any rate, it is certainly wasteful from a societal point of view. The people who have the best skills and experience exiting the system at or even before their prime? Doesn't make sense. Now, I will say that it does seem that really stopping contributing when you "retire" is also going the way of the dodo, so I think that's a good thing.

I am less concerned about the money (which as some people pointed out, you do trade off money for future pension and other benefits), but it's a waste of human capital for people to stop contributing so early. There's really no reason for people to be retired so early in general.

Yep, that's exactly why this is hard. There's a reason sound bites don't cut it, and politicians aren't actually stupid; they just have a very different set of constraints.

Yeah, actually, in this scenario it's not that bad. My numbers are what I'd estimate one would need to switch from a base salary to "make a living" as a consultant. In this case, you're really an adjunct part-time employee, so that seems pretty reasonable. Hope it'll be fun for you.