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TWST: What, over the past 12 months, have been the key issues and trends that have set the stage for the next 12 months within the telecom/Internet network?

Mr. Powers: You’re starting to see the convergence between the telecommunications network and the Internet. Over the next few years, the telecom network itself, which has been originally engineered to carry voice traffic and which has had data traffic grafted onto it, is going to reverse that architecture. You’re going to see the emergence of networks that look a lot more like the Internet with a provision for voice and video traffic grafted onto them.

Beginning last year, a number of events made it come together more slowly than most people anticipated a year ago, primarily the financing situations for newer emergent carriers during the last year, which has slowed down some deployments. The overall trend toward being a network that is more focused on high-speed data and carrying voice traffic on top of that will certainly continue over the next couple of years.

In the Internet sector, certainly we have been seeing, and we’re going to see, a lot more high-speed access. It’s become a mainstream consumer product. The biggest area where you see that right now is over cable TV networks. There’s an increasing number of people getting high-speed access through DSL, and you’re going to see a significant increase, over the next couple of years, in wireless high-speed Internet access.

You’re going to see the telecom network itself evolve into something that looks more like a high-speed Internet, and you’re going to see a lot more consumer access to that network over DSL, cable, and broadband wireless connections.

TWST: Today, what’s the market sentiment? Do you see these as areas where funding is available, where merger and acquisition activity can occur, where investors are looking to put money?

Mr. Powers: Yes. This is an area that continues to attract a lot of investment. It’s not as overheated a sector as it was, say, a year ago when you were seeing a number of what really were me-too business plans attracting hundreds of billions in fresh capital. But it continues to be one of the major growth areas in the economy, and it’s a sector that I anticipate will see a huge amount of growth over the next five years.

TWST: Give us a brief overview of Excite@Home, particularly focusing on its expected performance over the next 12 months?

Mr. Powers: @Home (Nasdaq:ATHM) is the other Internet access provider at the conference and are the dominant provider of cable-based Internet access. They also own Excite@Home, the number five portal in the US. High-speed Internet access is a huge growth area. @Home has been by far the largest provider, and it continues to be on target from a subscriber acquisition perspective. The portal business is, as a sector, one that has struggled as prices and Internet advertising have declined over the last six months. That has been a real challenge for the company from an earnings perspective, but this is another company in the downdraft of Internet stocks generally, that has been left as a real opportunity, from a value perspective. We have a Buy rating on the stock and a $17 price target.