A classic !!
http://www.maoxian.com/archive/20030108.html
Buffett’s 1974 Forbes interview
B
No one Looks good !! – lesson for investors
N
A fantastic post on the Fool’s BRK board from elias fardo. Its a must read for a value investor
http://www.fool.com/community/pod/2005/050802.htm?ref=foolwatch
If one were to follow these principles, he could the harshad mehta bust, the MS shoes debacles, the fraudulent IPO’s of the past and a host of other scams.
Distinguishing between a commodity business and franchise
D
One of the analysis i have been doing for some time is to analyse various industries like cement, steel, media, gas , FMCG etc and try to asess their competitive scenario. The reason for doing this analysis is to gain a better understanding of these industries, compare them with each other and also to develop some kind of models / categorisations.
One of the frustations i have felt , is the lack of litreature on the various types of business models. The typical one that get discussed are the ideal franchise like business models like coke ( at global level ) or nestle, asian paints, HLL etc at an indian level. The other extreme are the absolute commodity type businesses like airlines, steel ( i agree that within these commodity type business there are some value creating companies).
But there are businesses out there, which lie between the two extremes. For example auto components, power , banks, branded textiles etc. I am trying to analyse these various industries on porter’s five factor model and other variables so that i can conceptually think about a business and assign it to a model (not the best approach, but makes it easier to analyse a company and gives a starting point
While i was doing this, yesterday, i came across one such exercise being done ( http://pink-sheets.blogspot.com/ ). Should be helpful to me in my exercise
Buffett’s comment on telecom industry
B
The other day i posted a link for a talk which buffett gave in omaha. One of the question was on his opinion of the telecom industry. He said that he cannot predict the future of industry ( said he does not even know the complete history) and the industry has too much change (which is bad for the investor)
This had me thinking and then i came across this article below in economist (link given , i have added on a portion of the article as it could have some copyright issues ). On reading this article, i think one would tend to agree with buffett. It is very difficult to really predict the long term business model of the telecom industry. Today VOIP is the killer app , tomorrow it could be something else ….
http://www.economist.com/business/displayStory.cfm?story_id=4232442
Established telecoms companies are fighting an increasingly bitter battle against innovative attackers
That is because IPTV forms part of a larger, and quite desperate, defensive strategy now being adopted by telecoms firms against fierce attacks on multiple fronts. On one front are cable giants, such as America’s Comcast, which are luring customers with an enticing “triple-play bundle” of TV, broadband and telephony services. On a second front are mobile-phone operators, which young customers in particular are increasingly using to “cut the cord” from their fixed-line company.
But arguably most dangerous of all is the third front, where traditional telecoms firms are under attack from voice-over-internet-protocol (VOIP) providers, which use the internet to carry conversations that would previously have taken place via a conventional phone. TeleGeography, a research firm, estimates that the number of subscribers to VOIP services such as Vonage, which lets users plug their traditional phones into a gadget connected to the internet, will grow from 1.8m at the start of this year to 4m by the end of December in America alone; by 2010, it projects over 17m American subscribers. This does not count the world’s largest VOIP provider, Skype, which uses a small and simple software application to let users make free calls between computers—so far, it has been downloaded 141m times.
Hanging on the telephone
Traditional telecoms firms are doing their best to respond to these threats by adopting internet technologies themselves. This week, VSNL, the top operator in India for international calls, said it would buy Teleglobe, the world’s largest international wholesale VOIP carrier. Every big telecoms firm is investing to migrate from old, circuit-switched networks to new internet-based ones, with Britain’s BT probably moving fastest. The threat from VOIP would then be neutralised, as the telecoms firms themselves would be providing it. Even so, VOIP makes already grim revenue forecasts for old-style telecoms firms look truly depressing (see chart).