Cherreads

Chapter 440 - Chapter 434: The Signed Article

To be precise, Simon wasn't actually too worried about outsiders spying on him.

Even though he had accumulated enormous amounts of initial capital several times through the financial markets, all his operations had remained strictly within the rules.

As for Simon's greatest secret, he had never revealed it to even those closest to him. If anyone wanted to uncover it, they would have to get inside his head.

Clearly, no one could do that. 

Therefore, if one had to find an explanation for all the extraordinary things Simon had shown over the years, the only fitting description was probably that he was exceptionally gifted.

And Simon truly was exceptionally gifted.

However, even though there were no exploitable weaknesses others could use to threaten or control him, Simon absolutely did not want to be monitored. No one would.

Quietly making arrangements to track down whoever was watching him, time slipped into September 1991.

After his meeting with Al Gore, the Westeros system began mobilizing its resources to push the Information Superhighway Act forward.

It was not limited to behind-the-scenes political lobbying. To generate buzz for Cisco's September 6 listing, discussions about the internet surged across North American media channels, thanks in large part to the Westeros system's efforts.

On September 1, The New York Times published a special feature titled "The Coming Internet Age" as its front-page headline. The byline belonged to Simon Westeros himself. Soon after, major newspapers on both the East and West Coasts, along with the Ygritte Portal, reprinted the piece.

The article had indeed been written by Simon personally, though that was not entirely accurate.

Last year, Simon had prepared a memo dozens of pages long outlining various concepts and future prospects for the internet industry, which he had shared with Ygritte and several other company executives. The document touched on core ideas from his memory of the internet era, including portal sites, e-commerce, big data, cloud computing, and more.

This newspaper article was simply an excerpt focusing on the "outlook" section of that original memo.

Since rising to prominence, Simon had granted very few interviews, let alone published signed articles in newspapers. The piece debuting in The New York Times naturally triggered intense attention and heated discussion.

While some media outlets criticized Simon's prediction that the internet industry's output would reach trillions of dollars within the next decade as sensationalist hype with ulterior motives, the article's most immediate effect came the very next day. On September 2, the first trading day of the new week, internet-related technology stocks across the U.S. market surged.

Cisco's IPO roadshow also benefited directly from Simon's signed article, with share subscriptions climbing sharply.

By the end of the roadshow, subscriptions for Cisco stock had reached 530 million shares, more than thirteen times the 40 million new shares being offered and even double Cisco's existing total shares.

Unlike traditional tycoons such as Sam Walton, John Kluge, and Warren Buffett, who had built their fortunes over decades, the speed at which Simon had accumulated his personal wealth could only be described as miraculous.

Moreover, Simon's article was far from baseless speculation.

Over the past year and more, too many signs had pointed to a new industry rapidly taking shape.

Because the world's largest personal computer market was mired in economic recession, analysts had originally forecast that 1991 PC shipments would stagnate at around 20 million units, the same as 1990.

In reality, however, global PC shipments had already reached 15 million units by the end of August, and were projected to hit 23 million for the full year, a 15 percent increase over 1990.

Institutional research showed that a large share of these purchases or upgrades came from consumers wanting to surf the internet.

Previously, personal computers had been primarily business tools with limited entertainment value. As long as an existing PC still functioned, few people bothered replacing it.

In addition, the growth in North American internet users was plain for all to see.

By the end of August, the number of users accessing the World Wide Web platform across North America had surpassed 8 million, with nearly one million new users added in that single month. For the whole of 1991, the total was expected to approach 13 million. North America's largest internet service provider, America Online, had once again raised its full-year user forecast to between 6.5 million and 7 million.

On the content side of the World Wide Web platform, aside from the Ygritte Portal, Ygritte Company's statistics showed that by the end of August, the total number of websites connected to the platform had officially passed 20,000.

This figure was minuscule compared to the hundreds of millions of sites that would exist years later. Many were still basic personal pages. The crucial point, however, was that just in the month of August, 1,800 new sites had joined the World Wide Web. That explosive monthly growth of 9 percent, which continued to accelerate, once again highlighted the internet industry's tremendous potential.

Finally, the steady rise in Ygritte Company's revenues from advertising, software sales, and server space leasing also demonstrated to outsiders that the internet industry could be highly profitable.

Simon's signed article thus served as a catalyst. With all the necessary conditions already in place, it ignited the industry's explosive growth phase.

After several rounds of adjustments, Cisco's offering price for the new shares was finalized at eighteen dollars. With 40 million new shares issued, the total funds raised would reach 720 million dollars.

Compared to the 17-to-19-dollar range originally filed with the SEC, Simon had made a small concession.

Still, for a company with annual revenue of only one billion dollars, a near-five-billion-dollar valuation and raising 720 million dollars in a single offering would, if successful, be nothing short of groundbreaking.

In truth, the actual stock listing and trading marked only the final step of an IPO. By that point, the outcome had already been decided. An oversubscription rate of thirteen times for the 40 million new shares clearly signaled a resounding success.

Many investors were essentially placing bets.

They were betting that Simon Westeros would once again create a miracle, just as he had in recent years.

After all, even in the technology investment space alone, Simon's series of bets had already earned him handsome returns.

The most notable example was undoubtedly Microsoft.

Boosted by strong Windows sales, Microsoft's market capitalization had reached 12.6 billion dollars by the close of trading the day before Cisco's official listing.

The 20.3 percent stake held by Westeros Company was now worth 2.55 billion dollars.

Intel, whose alliance with Microsoft was growing ever closer, had seen rapid stock appreciation this year thanks to continued PC industry growth and rising demand for high-performance computers. By the close the day before Cisco listed, Intel's share price had risen more than 35 percent from the previous year, pushing its market capitalization to 10.7 billion dollars and establishing it as a true giant.

Westeros Company held 15.6 percent of Intel, making it the largest shareholder in the now widely held high-tech firm.

With Intel valued at 10.7 billion dollars, Westeros Company's stake was worth 1.67 billion dollars.

Just these two investments in Microsoft and Intel had already far surpassed the profits Simon had made from the 1987 stock market crash. Westeros Company's holdings in Oracle, Sun Microsystems, and Silicon Graphics had also delivered impressive gains over the past year.

With the upcoming listings of America Online and Cisco, the Westeros system's presence in the new technology sector had grown to a level comparable with its media and entertainment holdings.

Simon naturally would not miss Cisco's listing day.

Having arrived in New York the day before, he spent the night at his Fifth Avenue apartment in Manhattan. Shortly after seven o'clock on the morning of September 6, he headed straight to the Nasdaq exchange in Midtown.

Thanks to the recent publicity surrounding Cisco's IPO, the bell-ringing ceremony was even more lively than America Online's in July. Senior executives from Daenerys Entertainment, including Amy Pascal and Robert Iger, all attended. In addition to the strong Hollywood contingent, the Cisco team had invited a large group of politicians and celebrities.

After taking photographs and exchanging brief greetings with the guests, Simon was quickly escorted into the Nasdaq exchange's interview hall.

The setup was almost identical to two months earlier.

Although he had already answered many questions during America Online's listing, the media's curiosity toward him clearly could not be satisfied by those brief ten minutes.

"Simon, Cisco's IPO has essentially succeeded. Still, a five-billion-dollar valuation strikes me as rather crazy. How exactly did you arrive at that decision back then?"

"Because I believe Cisco possesses exactly that kind of market potential, just as I did when I invested in Microsoft and Intel. This is a very clear industry trend. Whatever the scale of the traditional telecommunications equipment market, the emerging internet industry should have comparable capacity in its infrastructure segment. Cisco's development has only just begun."

"Traditional telecom equipment makers like Motorola only have market caps around ten billion dollars. Simon, do you believe Cisco can surpass Motorola?"

"I already sold my Motorola shares."

"..."

The answer seemed slightly off point.

Inside the Nasdaq interview hall, the reporters were momentarily stunned before several of them burst out laughing.

Simon Westeros's long-running entanglement with Motorola had been a frequent topic in the media in recent years.

Robert Galvin, Motorola's former chairman, still regularly criticized the young tycoon's various moves in public.

Many technology stocks had been rising lately.

Yet some reporters immediately realized that Motorola's stock price might take another hit at the opening bell today because of Simon's remarks.

Although Motorola had grown rapidly in recent years, this was a company that even Simon Westeros had lost confidence in.

"Then, Simon, what do you believe Cisco's market capitalization potential actually is?"

"That depends on how far ahead you're looking."

"Five years?"

In this timeline, internet development in 1996 should at least match what he remembered from 1998.

Simon thought carefully for a moment and replied, "Around fifty billion dollars."

A brief wave of commotion swept through the room at the number Simon had given.

There were live cameras everywhere. Making such bold claims carried responsibility.

Five years. Fifty billion dollars.

From Cisco's current five-billion-dollar valuation, that represented a one-thousand-percent increase.

Going from five hundred million to five billion might have been plausible. But scaling from five billion to fifty billion was a completely different matter, a qualitative leap.

In all of North America, only a handful of companies, such as IBM, General Motors, and AT&T, had market caps reaching the fifty-billion-dollar level.

"Simon, are you serious?"

"Simon, is this some kind of guarantee, or just a joke? Keep in mind there could be millions of people watching you on television right now."

"Simon, what is your basis for this?"

"Simon..."

The reporters below grew restless, and even some of the onlookers outside the interview area showed expressions of astonishment.

Simon sat relaxed on the sofa, waiting for the noise to subside slightly before raising his hand and speaking.

"No one can predict the future with certainty. The fifty-billion-dollar figure represents my confidence in Cisco. You can choose to believe it or dismiss it entirely. Since this concerns future events, I cannot offer any guarantees. However, everyone can look at what has already happened. For instance, when I first invested in Microsoft a few years ago, the company's market cap at the bottom of the stock crash was only slightly over one billion dollars. Just yesterday, it stood at 12.6 billion dollars."

"Simon, Microsoft was a miracle."

Simon shrugged and smiled. "Who says it wasn't? Moreover, Microsoft still faces many competitors today, while Cisco has none. Not just in the United States. Cisco has no real rivals anywhere in the world. The internet industry is destined to be global in nature. So who can say that Cisco will not become the next miracle?"

"Simon, are you suggesting Cisco is a monopoly?"

Hearing the question, Simon glanced at the reporter and promptly shook his head. "Of course not. I actually hope more companies will emerge to compete with Cisco soon. A lack of competition will only cause an industry to stagnate."

The reporter quickly pressed on. "But Simon, the fact that Cisco, America Online, and Ygritte together dominate World Wide Web technology is quite obvious."

Simon shook his head once more. "I disagree with that characterization. It is highly irresponsible to casually label companies as monopolies. The current situation is more accurately described as the Westeros system's companies simply being ahead of everyone else, much like when Bell first invented the telephone many years ago. You cannot slap the 'monopoly' label on someone simply because they invented something before you did. Over the past few years, Westeros Company has poured billions of dollars into developing World Wide Web technology. Since we created the technology, we naturally have the right to enjoy the advantages of being first."

Another reporter asked, "So will the Westeros system open its core patents to competitors?"

Simon nodded. "In fact, we are already doing so. Otherwise, you would not be seeing as many as twenty thousand websites appear on the World Wide Web platform."

After finishing, Simon subtly glanced at the host beside him. The Nasdaq vice president who had hosted America Online's ceremony was once again in charge. Understanding the cue, he selected a media outlet friendly to the Westeros system and smoothly moved the conversation past the sensitive monopoly topic.

More Chapters