SNS in the News - October 25, 2002


Five Distant Lights Suggest Positive Change in Economic Climate
Technology Analyst Mark Anderson Identifies Harbingers of Improvement

SEATTLE ñ Oct. 25, 2002 ñ International technology analyst Mark Anderson ( says there are an increasing number of events and trends that portend a positive change in economic news. Five distant lights, if you will, that may be the harbingers of a long-term, if low-key, improvement in business conditions.

In this weekís edition of Andersonís Strategic News Service newsletter, Anderson identifies five indicators:
  1. PC Operating System sales. It appears that sales (and installations) of OS software are moving at record rates. IBM's adoption of Linux has given that OS legitimacy, and provided Sun and Microsoft worthy competition. (Sun, like Dell, Hewlett-Packard, and others, now ship Linux servers; unlike Microsoft, Sun looks like the first obvious victim in a Linux victory, as it takes Solaris' share of the Unix pie). With record sales of Windows XP just announced, and .NET Enterprise Server also doing well, this particular sector - even before the Microsoft license avalanche - appears to be healthy and booming. I'll note again here Microsoftís comments about improved PC unit sales YTY. It appears that software will drive the current technology industry, until broadband finally built releases the content, equipment and services business again.
  2. Ad sales. Last spring, U.S. television advertising sales took off, and current rates for doing last-minute fills remain at or near industry highs. While ad deals remain iffy for the online crowd, the money has now returned in the world of traditional media. Since ad sales represent increased commerce, coming or going, this has all the look of an increasingly strong U.S. economy.
  3. Government Spending Is Way Up. Many technology companies, in all sectors, are turning their attention to the U.S. government, since the U.S. government seems willing to spend anything at all, without budget constraints, in this new Terrified environment.
  4. Asia Launches the Broadband Revolution. Someone had to do it, and Japan and South Korea get the prize. Not surprisingly, their hardware/device vendors are now taking increasingly large pieces of the global pie. Sony claims to be the fastest-growing PC maker, and Samsung has just replaced Sony/Ericsson as the third-largest cell phone handset maker in the world, with 10% share (Nokia and Motorola are the first two). Almost all of the economic signals remain very bright in the near term for Asia.
  5. U.S. interest rates remain low, and headed lower, while housing starts and car sales remain robust. This has really been the story of the "shadow" economy, since the Fed began its long series of "I screwed up" rate reversals: housing and cars (large rate-sensitive purchases) followed, while the rest of the economy, led by technology, went south. The good news in this, if you see it that way: the Fed can go even lower, and probably will.
About Strategic News Servic
Founded in 1995, Strategic News Service ( is the most accurate predictive letter covering the computer and telecom industries. It is personally read by the top managers at companies such as Intel, Microsoft, Dell, Compaq, Sun and Hewlett-Packard, as well as by leading financial analysts at the world's top investment banks and venture capital funds, including Goldman Sachs, Merrill Lynch, Hummer Winblad, Venrock and Warburg Pincus. It is regularly quoted in top industry publications such as BusinessWeek, Newsweek, Infoworld, Institutional Investor, Upside, the Financial Times, the New York Times, and elsewhere.

About the Publisher
Mark Anderson is president of the Strategic News Service(tm) LLC and Technology Alliance Partners. TAP was founded in 1989, and provides trends and marketing alliance assistance to firms leading the convergence of telecom and computing. Mark is a Seybold Fellow. He is the founder of two software companies and of the Washington Software Alliance Investors' Forum, Washington's premier software investment conference; and has participated in the launch of many software startups. A past director of the WSA, Mark chairs the WSA Presidents' Group. He regularly appears on the Wall Street Review/KSDO, CNN, and National Public Radio/KPLU programs. Mark is a member of the Merrill Lynch Technology Advisory Board, and is an advisor and/or investor in Authora, Ontain, Ignition Partners, Mohr Davidow Ventures, and others. He also serves on the board of the not-for-profit Hybrid Vigor Institute, and is a principal in the investment advisory firm Resonance Capital Management LLC, that manages the accounts of institutions and high-net-worth investors, focused on technology markets.