Guest Issue: June 15 – 21, 1998

from the Guest-Issue dept

With no plans, whatsoever, to acquire a portal site.

The not always serious,?
not always weekly update
on the High-Tech Industry
June 15th - June 21st
With no plans, whatsoever, to acquire a portal site.
Still on hiatus (no, really)
Okay, so I (that would be me: Mike) am still on hiatus, but we have David Lundell ( to thank for this excellent guest issue. Please feel free to send both of us feedback ( and let us know what you think (i.e., should he really quit his day job and let me just edit these things).? While David put a small note at the end pointing out that he wrote this issue, I just wanted to thank him for making sure that my hiatus was more of a semi-hiatus.? Still no promises on how many issues will be produced over the next few weeks, but keep the feedback (and subscriptions) coming.

If anyone else is interested in writing guest issues at a later date, please send email.? Okay, enough of my babbling from beyond. Onward to David's work:

Say that again...
"Ultimately, we said we would rather own 40 percent of No. 1 than 50
percent of No. 3"
- C|Net's Halsey Minor, discussing NBC deal giving the television network the option to buy 60% of Snap! And you thought AOL, Yahoo and Excite were the Top Three. Memo to Halsey: how bout 40 percent of number eight?

"There is nothing sexier than a C.E.O. who has a passion for his product."
- C|Net editor Christopher Barr, on his boss Minor

Operating System stuff
Dataquest said Microsoft will ship 56.7 million units of Windows 98 and it anticipates "modest to low interest" in Win 98 upgrades... Be released BeOS upgrade version 3.1. Expect modest to low interest in that one too..."Loud boos," but thankfully no violence or bloodshed during the "Linux vs. NT" public forum at the 35th Design Automation Conference...

Earnings Reports, IPOs and the like
Iomega continued to slide, announcing Thursday that it will report losses
between $25 million and $35 million for the second quarter. This isn't just
another bad quarter for the Zip drive maker -- it is in danger of defaulting on its $200 million credit line. Iomega execs maintain that they will be profitable by the fourth quarter, but don't put too much faith in that -- last quarter they said that this quarter would be "in the range of a small loss to break-even"... Best Buy beats estimates, shares drop over 2 points... Software.Net issues IPO, price skyrockets 47% in first day of trading... Interplay Entertainment goes public, stock price skyrockets from $5.5 to $6...

Rumors, Conspiracies etc. of the week...
On the heels of Nortel's purchase of Bay Networks, Sweden-based telecom equipment maker Telefon AB L.M. Ericsson is looking to buy up to seven small-to-medium sized networking companies, with a few deals possibly happening soon...

News you could do without
The big news of the week is actually old news: AT&T made an offer to buy AOL weeks ago. Aside from "cultural differences" between the two companies, many factors complicated the proposed $32-33 billion deal.? Some of these deal-breaking factors included AOL's hundred million dollar plus agreement with Tel-Save and the fact that CEO Steve Case is on the board of Worldcom, which is acquiring AT&T arch rival MCI... If only to make C|Net's ongoing "portalopoly" feature even more exciting than it already is, the portal grab by major media companies continued as Disney bought a minority stake (43%) in Infoseek for $70 million plus Starwave. Disney can purchase the 7.1% it needs to gain a majority holding for an extra $139 million. Infoseek promptly put those trademark mouse ears on its home page, along with the phrase "Let the magic begin"... All this of course following NBC's investment in Snap two week's ago, a deal potentially worth $66 million -- not bad for a portal whose 70 content providers are only slightly outnumbered by the number of visitors it receives every day (its 1.67 million users per month puts its traffic at less than half of Hotbot, which is #7)... Compaq is negotiating with IBM to license the Alpha processor architecture from Digital Equipment, now officially part of Compaq. Compaq isn't just trying to take advantage of Intel's Merced delay - due to the FTC decision following the Alpha architecture lawsuits earlier this year between Digital and Intel, Compaq must make Alpha technology available to companies other than Intel... Hyundai-owned Axil computers called it quits. Some blame the Asian market crisis, while those with a clue point to increasing competition from Intel and the fact that there was really no significant market for eight-way NT servers to begin with... Microsoft Start page redesigned - to include more links to MS services (but where did the link to Hotmail go?)... Senator calls spamming "the scourge of the Information Age" - sorry, Matt Drudge!... Merrill Lynch exec says do-it-yourself online trading is "a serious threat to American financial lives"... Netscape 4.5 will be released in beta early next month... And oh yeah, by the way, PC Expo also happened. This too-perfect quote from InfoWorld Electric sums up the week's events at the Javitz Center: "PC Expo this year offered a grab-bag of new products aimed at various types of technology buyers, from consumers to small and big businesses."

While AOL seemed too busy maintaining its independence to do much else, it did find the time to file paperwork with the SEC to indicate that it may sell unsecured debt or shares of preferred or common stock to raise, oh, say a billion dollars or so. Such an offering, combined with a likely strategic alliance with AT&T, will give AOL plenty of cash to grow its already dominant business into new areas... Meanwhile, AT&T is reportedly looking to merge international assets with British Telecom. BT has been criticized recently over its plan to pay for its ISP business with increased phone rates. AT&T, on the other hand, seems to be feeling the heat of the MCI-Worldcom merger, which inched further along this week when European officials cleared some legal stumbling blocks and Cable & Wireless dropped its suit against MCI... U.K. cable operators Telewest Communications and NTL called off merger talks soon after NTL acquired two other U.K.-based cable franchises... Compaq announced a $200 million investment in cable-modem vendor Road Runner, as well as plans for an extranet for enterprise resource planning systems... Micron, after acquiring Texas Instrument's DRAM operations, passed NEC to become No. 2 Memory maker behind Samsung... Newt Gingrich will seek $4 billion to fix Y2K problem...

(Mis)Uses of Technology:
3Com's Palm Pilot to go beyond the browser -- what exactly this means is anyone's guess. 3Com execs are mum on the new software due by the end of the year, which will supposedly move away from the browsing "metaphor" for downloading information from the Internet. Let's hope 3Com isn't banking on a handheld Gopher revolution...

Good news for 3Com: IDC predicts handheld PCs will surpass desktop PCs in popularity within six years... The Business Software Alliance and the Software Publishers Association find that almost half of all newly
installed business programs worldwide were pirated and, as a result, the U.S. software industry lost $11.4 billion of revenue in 1997...

CBS has been rumored to be on the verge of either buying or taking a big stake in Lycos, the likely next portal to be snatched up, since its
valuation is somewhat closer to reality than Excite's or Yahoo's. Aside
from CBS, look for News Corp. to jump into the action at some point, as it is rumored to have looked into both Snap and Pointcast within the past year. Interestingly enough, the same publications which have been wondering aloud whether the portals are overvalued, are now shocked to see Infoseek to go for such a "low" price. Let's see, $70 million and an unprofitable business in return for a minority stake in the number four or five player? Sounds reasonable enough to me, if reason indeed exists in all of this "portal madness."

Robots with too much free time:
It's no surprise that, when two computers meet, they talk Trek:

And just for the fun of it: (worth the download time if you have QuickTime).

Up To Date is written by Mike Masnick from whatever news he hears from whatever sources they happen to come from.? It is not intended for any uses other than as one of many possible ways to follow what's going on in the hi-tech industry.? I certainly wouldn't rely on it as your only source of info.? And, of course, my comments may not accurately reflect reality. Finally, an explicit warning about investing: I do not, under any circumstance, consider any piece of information in this newsletter "investment advice" and neither should you.?

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