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The Tangled Web Of Fiber Optics Lines & Gates

Posted by ryuzaki0 on from the what-will-happen dept.

sdirector writes "Monday, super investor Warren Buffett jolted the nearly prostrate telecom industry by leading an investment of $500 million in Level 3 Communications ... Buffett's investment could set in motion a complex web of relationships and -- if you play it all out in just the right way -- put Bill Gates in charge of every fiber-optic line in the USA." The actual article itself is pretty interesting reading. Update: 07/12 08AM GMT by C :The link was broken, it has now been fixed. Sorry about that.

2 of 220 comments (clear)

  1. Fixed link by Gogo+Dodo · · Score: 5, Informative

    Here's the fixed link. The submitter didn't code the HTML correctly.

  2. Re:I don't think so. by vidarh · · Score: 4, Informative
    I'm fully with you about the regulators. As for Buffet, I think the reason he's going for telecom now is that they pose an exceptional opportunity:

    The market has fallen extremely far to start with, then the KPNQwest bankrupcy in Europe, the Worldcom scandal and the Qwest investigations, makes telecom take a nosedive. There are bound to be lots of opportunities now.

    If Level3 is healthy (I wouldn't know, haven't looked at their numbers), and there's no scandals lurking, they should be in a very good position to steal worried customers from the others, and even if they don't their shareprice should still have a reasonable growth potential when the market rebounds.

    I guess he might have seen it as a larger than usual opportunity. But before you run of to buy level 3 stock, remember that Buffet knows people - he may have deals in place that gets him way more potential from Level 3 than the average investor will (and btw. I'm referring to legal possibilities here - it gets so much easier to make money when you're already rich and people want to cut deals with you)