Voice-over-IP Conference Highlights

VoIP Conference Highlights the Transition to Intermodal Competition
Morgan Stanley hosted a conference dedicated to understanding the drivers and catalysts for Voice-over-Internet Protocol (VoIP) adoption. The day was divided into panels focused on understanding the architecture, cost, and revenue potential for Enterprise, Cable and Carrier VoIP.

Enterprise Transition Picking Up Steam
Cutting costs through toll bypass and network management
simplification has improved the ROI of enterprise VoIP. We expect accelerated deployments in 2004 but see 2005 as real inflection point. We believe AV will emerge as the leading equipment provider in this space.

Cable VoIP: Stepping up to the Plate in 2004
The MSOs have a cost advantage in providing residential VoIP
services and the prospect of bundling voice, video and data is a
compelling story, in our opinion. We believe the speed with which
MSOs decide to aggressively deploy and market these services is a critical near-term factor.

Service Provider Dynamics: V Not Just for Voice
VoIP is a step toward the ultimate goal of delivering multi-media over IP networks. The carriers should face increasing pressure from MSOs and alternative telephony providers and appear poised to aggressively fight back with their own voice and video over IP offerings. We believe the network builds needed for these services should benefit the large, diversified telecom equipment manufacturers.

Industry Views
We have an Attractive view on the Wireline Networking Equipment industry and an In-Line view of both the Satellite/Cable and Telecommunications Services industries.

May 2004 - Voice-over- IP Conference Highlights - Part 1 of 1 (14 pages)