CIBC World Markets - Daily Teletimes

---------------------- Forwarded by John Enerson/HOU/ECT on 01/13/2000 01:4=
4=20
PM ---------------------------
From: Jean Mrha@ENRON COMMUNICATIONS on 12/17/99 01:25 PM
To: John Enerson
cc: =20
Subject: CIBC World Markets - Daily Teletimes

----- Forwarded by Jean Mrha/Enron Communications on 12/17/99 01:26 PM ----=
-

=09Jay Hawthorn
=0912/17/99 10:00 AM
=09=09=20
=09=09 To: Tom Gros/Enron Communications@Enron Communications
=09=09 cc: Tom Huntington/Enron Communications@Enron Communications, Jean=
=20
Mrha/Enron Communications@Enron Communications, Kristina Lund/Enron=20
Communications@Enron Communications, Rob McDonald/Enron Communications@Enro=
n=20
Communications, Scott Pleus/HOU/ECT@ECT, Melissa Jones/Enron=20
Communications@Enron Communications, David Cox/Enron Communications@Enron=
=20
Communications, Mitch Olson/Enron Communications@Enron Communications, Ted=
=20
Seitz/Enron Communications@Enron Communications, Bill Abler/Enron=20
Communications@Enron Communications
=09=09 Subject: CIBC World Markets - Daily Teletimes

FYI, a daily report put out by CIBC illustrating their view on the emerging=
=20
market...

Daily Teletimes CIBC World Markets

We had a very informative meeting with Enron=01,s management yesterday--Jef=
f=20
Skilling, CEO of Enron (ENE - Buy) as well as Ken Rice, CEO of Enron=20
Communications and their Software VP, David Berberian and others. Enron has=
=20
built out a substantial fiber network and begun to make substantial moves=
=20
towards developing a bandwidth trading market. We don=01,t believe that a =
lot=20
of telecom investors understand how well thought out and agressive Enron=20
plans on being in this market. It appears that Enron is now planning to=20
articulate its strategy- specifically at their investor conference on Janua=
ry=20
20th in New York. While details will have to wait until the 20th, Enron is=
=20
essentially aiming to build a gateway tieing in all the major long-distance=
=20
networks, guaranteeing premium quality and pricing in doing so (i.e. a =20
=01&Network of Networks=018). While ENE does plan to use its own network t=
o carry=20
traffic, it plans to focus largely on seamlessly integrating capacity bough=
t=20
on other carriers networks. Operationally, this boils down to a very smart=
=20
switching system that gives customers the capabilities and reliability of a=
=20
single network at the front-end while integrating capacity sourced from=20
multiple networks on the back end, creating more robust overall transport=
=20
capabilities. ENE believes that this integration of multiple networks will=
=20
offer greater path diversity, reliability, and efficiency than any=20
single-network solution. We note that Enron=01,s multi-sourcing approach i=
s=20
tailor-made to foster the development of a robust capacity trading market (=
as=20
discussed in our recent bandwidth trading report). Given Enron=01,s domina=
nce=20
of the electricity and natural gas markets, we believe that there is no=20
better positioned company to create and capitalize on such a market in=20
bandwidth. While we await further details, we did leave the meeting with =
a=20
much greater understanding of and confidence in ENE=01,s overall telecom=20
strategy. We believe that their telecom business could create tens of=20
billions of dollars of shareholder value if ENE executes well. We recommen=
d=20
that telecom investors make an effort to attend the Jan. 20 meeting.=20

Tim Horan 212-667-5459