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TWST: What are the criteria that you try and hold when you look at some of the developments that are going on? When you’re looking at specific companies when you’re following and tracking, what are some of the main criteria that you’re sticking to?

Mr. Dixon: The value driver in this business, indeed in any business actually, is the ability of a company to identify a customer base or a customer type and to create an interaction between a customer base and an appropriate product set. That’s true of any industry at all. If you’ve got the right product and the right customers, you deliver the product and the customers send you money. Really, the art in building new telecommunications businesses is in being inventive with the products set and being opportunistic. We are seeing this happen with communications companies getting into things like Internet application hosting, web hosting, and so on, and getting involved in more broadband services, getting involved with things like innovative tariffs with bundling and cross-product tariffing. We’re seeing a lot more innovation and flourishing of new types of communications products. The other thing where companies are showing that they can be very successful, especially again the start-ups, is in identifying particular sorts of customers in particular geographic locations. Some go for financial service companies in big city centers. Some are concentrating on small or medium enterprise customers in provincial towns. Some are going squarely at the consumer market. This is something that the cable companies, for example, in Britain are doing: offering telephone service alongside cable TV and getting some cost advantages in doing that. The important drivers really are when you go and see a company. When you analyze what a company is doing, have the management got a clear view of what their target marketplace is and what products they’re going to hit them with? And if they’ve got that, engineers are good at solving problems and they’ll find all that stuff and deliver it and make a success on it.

TWST: What about Energis Plc?

Mr. Dixon: Energis’ (EGS.L) approach is little bit different. They’ve concentrated on business-only users. They’ve tended to go for the medium-sized or slightly smaller businesses. They’ve been very clever to exploit interconnect where they can gain access to customers over other networks. It’s starting in the UK with the BT network. They built a low-cost national network, a long distance network. Where COLT concentrated on local, Energis concentrated on a national long distance network. They were able to do that by building their network effectively alongside the existing high voltage electricity distribution system of the National Grid (NGG.L). National Grid is the company which carries power between Britain’s power stations and its main cities. Inside the cities, the local electricity company sells that on to the consumer. National Grid runs the system of towers and high voltage cables that join the whole thing together. There’s about 7,000 miles of that in the UK. Energis constructed a fiberoptic network alongside that. For a time, National Grid was their parent company and then it got floated off on the stock exchange. They quickly built themselves up a very low-cost fiber-only long distance network. They have replicated that model. They’ve acquired a company called Entertel in Holland which was also based on the energy business and built fiberoptic networks there. They acquired and further built out a long distance carrier in Germany called Carrier 24. They, too, are now spreading out all across Europe and will soon have 25,000 kilometers or so of fiberoptic network going from Madrid in the southwest all the way up to Stockholm and beyond in the northeast of Europe.