No. of Recommendations: 5
Jim said: " they are collectively using some fairly heroic assumptions about future revenue from those assets. "
1. That the revenue will increase exponentially without following the usual "S" shaped growth curve of new technologies - early adoption --> rapid growth --> plateau. For years, long enough to cover the massive up-front investments.
2. That, unlike past technologies, there won't be a new technology development that will make them obsolete. cf. Wang computers, etc.
3. That the market will respond as it always has before - when a cheaper work-around appears (like the Chinese developments) that gives end-users a good-enough result the customers will shift.
Wendy
