This is my first post in this excellent board after two years watching the board, so forgive the length of this post. Top of mind, these are my top 10 comments:
1. Tim Huff absolutely believes in Sanswire, Hotzone and is a true visionary. As a technologist he can pull it off, if he had the right team.
2. Huff is an incredibly bad manager and his team reflects that. The P&L and the delisting are testament to his incompetence. Aside from Uli, Bob and to a lesser extent Dan (Vozbrazil) there is no outstanding talent on his team I can see who has actually delivered something...all the rest are deadwood. For example, the stored value card project, which was supposed to be a major initiative of GTE , was hit by top management neglect and therefore zero execution.
Notwithstanding,if Huff resigns ( I cant see him being fired) from GTE completely, the stock should crumble as he is GTE's soul and why 80% of those long are in the stock. BTW, who would replace him? He should perhaps gracefully resign a la Gates in MSFT and be the Chief Architect and appoint a real CEO to run the company. GTE needs a manager who is watching the trees as well as the forest...
3. The news of delisting has overshadowed the fact that the company's minute reselling will be profitable soon (although this is a lousy business), Hotzone has run successful pilots in Mexico, China, Europe, etc...and has the potential to be a killer app. Vozbrazil is cashflow positive despite the fact that VOIP is a commoditized industry after Skype....which is a buying opp.
4. Worse companies in the telecom space are making $ hand over fist...you can make alot of mistakes and still be profitable if you are a telco...
5. Uli, behind Huff, is both a good businessman and engineer. IMHO, If he did not burn through his cash and lose all his major clients in his old company, he would be huge. GTE lucked into this one in their search for a last mile solution
from Sanswire. I expect good news from this division.
6. Sanswire is very very experimental..but a buy out or JV is not unlikely from Northrop or the other major defence contractors...No revenue in the foreseeable future but at least an exit strategy for GTE shareholders.
7. Everyone acts like shorters are a bad thing. The shorters take a big risk...so my hat is off to them...plus they help liquidity on the upside. when they are forced to cover... There is something vaguely "unpatriotic" with short sellers of visionary technology that is both feasible and important to our national defence but its their money and so far they have been right.
8. Randy Dumas WAS the real deal, but his star has fallen quite a ways from his days in Investment Banking and Rubikon. If he disengages from GTE, no big loss as he has not produced anything but a few diplomats with zero value add and business experience. HIs contacts around the world are assumedly impeccable but he has not been able to convert that to real contracts or capital raising. Frankly , he reminds me of an old aging boxer whose time has passed. He may have a few punches left, but he is running on the fumes of old contacts and experience..hopefully he can help but I would not count on it.
10. Expect a management shakeout and some good news from Hotzone and profitability from Centerline to stabilize the stock, followed by surprise earnings from Centerline and deals from Hotzone around the world and potentially an India deal.
I hope for the best for GTE as they creat important paradigm shifting technology but their execution has been wanting. Ironically, I would go long at these levels and would sell at >3.00
