1/11/99 – 1/17/99

from the Up-To-Date dept

Thinking it’s about time for an IPO

The not always serious,
not always weekly update
on the High-Tech Industry
January 11th - January 17th, 1999
Thinking it's about time for an IPO
Say that again...
"We don't always have to be the first rabbit out of the gate."
- Jeff Crown, VP of Business Development at Lycos. Wait, do they race rabbits?

"Broadcast.com, meanwhile, keeps surging because [your explanation here]."
- Wired News summary of coverage on Broadcast.com's insane quadrupling stock price.

"Customers want to buy what their colleagues buy."
- Eric Feldman, Director of Marketing for ComputerLand. And, they say that marketing is more of an art than a science...

"It would HELP ME IMMENSELY to have a survey showing that 90 percent of developers believe that putting the browser into the operating system makes sense ... Ideally we would have a survey before I appear at the Senate on March 3rd."
- Bill Gates in an email prior to the trial. Miraculously, just such a survey was "uncovered", and used by Microsoft's economist.

Earnings Reports, IPOs and the like
@Home will restate its earnings for 1997 and the stock market doesn't even notice... Investors pour $25 million into TheStreet.com as it begins planning for an IPO... Making that IPO seem even more exciting was Friday's insane IPO of CBS Marketwatch. Opens at 17 and immediately trades well over 90 -- and stays there (the second biggest leap after TheGlobe.com, which quickly collapsed)... Intel beats earnings estimates by a long shot... Yahoo beats earnings estimates and hits the whisper number, but the stock drops due to the insane expectation run up, and the resulting downgrades (including "Internet Queen" Mary Meeker's)... Seagate destroys estimates and is actually making a profit (how much did they save by getting rid of Al?)... Apple beats estimates and shows a huge increase in income (of course, the revenue increase is pretty small -- which surprises me. If they're selling so damn many iMacs, you'd think their revenue numbers would show a larger increase)... The return of failed IPOs: autobytel.com and Healtheon both decide to try, try again (and investors will buy, buy again)... Sybase lays off 400... E-Trade losing less than expected... MP3.com raises $11 million from Sequoia and others (say what?)... Inktomi beats quarter estimates and last years numbers (perhaps they should spend a little more money on making a product that can actually find what you're searching for)... AMD making money, but misses estimates... Beyond.com losing more money than expected (and a ton more than last year)... Motorola beats estimates, but is making quite a bit less than last year... Rambus meets expectations, and is still making money, but expects stagnation for the next few quarters... Symantec beats estimates and last year's numbers...

Rumors, Conspiracies etc. of the week...
For those expecting Bertelsmann to buy Lycos, an interesting note on the European front, where Bertelsmann already owns a portion of Lycos Europe: this week there was a management buyout of half of Bertelsmann stake by the CEO... Marimba (now that everyone's forgotten about them) to try to go public (really)... Oracle looking to buy Sybase... Softbank (which owns stakes in ZD and Yahoo) made Yahoo's profits look nicer by shifting money from ZD to Yahoo through a secretive advertising deal (sneaky)...

News you should have read elsewhere
U.S. Supreme Court says algorithms can be patented (antiquated understanding of intellectual property strikes again)... MCIWorldcom never really in the race for AirTouch, and Bell Atlantic drops out at the end, so Vodafone is left to sweep up the mess... Folks from big name companies join together to try (and good luck to them) to keep governments from regulating the Internet... Oracle finally gets around to launching their $100 million venture capital fund (Don't call Larry, by the way. You have to go through the standard VC channels to get your hands on the cash)... Meanwhile, Network Associate's new Vulcan fund isn't a venture capital fund (nor is it related to Vulcan Ventures) but a big pot of money to invest in companies (yes, the difference is *so* clear now)... Judge calls Microsoft temp contracts "outrageously arrogant"... Lucent bought both Kenan Systems and Ascend... Ascend shareholders bitched and whined about the price and filed suit against Lucent... Katmia officially called Pentium III (milk it for all it's worth)... Infoseek and Disney launched the Go Network this week (and, let's face it, it's nothing special)... Iomega buys what's left of SyQuest... The DOJ wants "more info" on the Netscape-AOL merger...

News you could do without
ICQ has doubled its membership to 25 million in the past 6 months... St. Louis judge forces IEG to take down their web site featuring info on the Pope's visit to St. Louis, due to its infringement of the Archdiocese's trademark (oh, and the "erotic" pictures included on the page)... India issues a "red alert" against using any security software created in the US for security reasons... Better yet, an Australian report (which wasn't supposed to be released -- but has been sitting on library shelves for quite some time) shows suggested plans to allow legalized government hacking and the means to cover up such... Samsung gives up on AST and dumps it off to the former chairman of Packard Bell NEC... IBM was granted the most US patents for the 6th year running... Bell Atlantic to offer AOL customers DSL (just what we need: AOL customers with additional bandwidth)... SGI's NT box finally officially launched to not nearly as much fanfare as past launches (perhaps that's because people actually cared about past launches)... The Sharper Image online adds auction capabilities (how original!)... Ticketmaster buys CityAuction... @Home to add auctions through Egghead.com (copycats)... Cyberwar plan not really called by hackers, says hackers... Yahoo files suit against YaHooka for the domain (is it really trademark infringement, or does Koogle have other plans for the site?)... SBC cuts the price on DSL as they finally realize that cable modems will win out when DSL costs three times as much... RealNames and Inktomi in a deal that would matter if anyone actually used RealName's technology... eBay realizes self-policing doesn't prevent fraud, and puts in place a number of systems to change things (including a deal with Equifax)... Pandesic is a drain on the resources of both Intel and SAP... In a related note, shareholders of iCat, the company Intel bought to fold into Pandesic, are suing (since the price Intel paid was just enough to cover outstanding debts, the investors don't get a dime)... IBM realizes that giving away DB2 free for Linux might hurt sales of DB2 on other platforms (wonder how many committees it took to come up with that stroke of genius)... Microsoft delays Windows 2000 (as if it were worth mentioning)...

Apparently Lycos forgot to put "exclusive" in their contract with IBM to be linked on all new IBM Aptiva's because it only took a few days for IBM to add Yahoo! and Excite to the list of portals "available" on all new Aptiva's (is this a special for the net clueless?)... Compaq buys Shopping.com as a late holiday gift for AltaVista (you need to wonder how much due diligence was done -- at last check, Shopping.com had hundreds of BBB complaints against it, and had "problems" shipping products that had been already charged)... Sucks to be varsitybooks.com. While they continue to focus on just a few Washington DC schools, Follett Corp has launched eFollet.com covering books for over 450 universities... The Supreme Court in Norway rules that it's legal to attempt to break into someone else's computer system (being successful, however, is illegal)... How to tell that Yahoo has gotten too big: this week they opened a lobbying office in Washington DC... Microsoft dumps $10 million into Banyan Systems (do they still do anything besides "own" Switchboard?)... eTrade to join with an investment bank and start underwriting IPOs... Bertelsmann buys into ONElist (why?)... Reuters buys VentureOne... Bell Atlantic to offer Lotus Notes (core incompetence?)... Infobeat has sold their operations and name to Sony, and will focus on their service business, Infobeat Express, to be renamed Exactis...

(Mis)Uses of Technology:
Delta to charge $2 extra if you *don't* book online (travel agents are pissed)... China is requiring the heads of all national airlines to be in the air on January 1st, 2000 as incentive to fix any Y2K problems... AOL to sell its service door-to-door (I plan on using this as an opportunity to give back the thousands of "free" AOL CDs I own)... @Home and RealNetworks to work together on improving the quality of videos on the Internet... Archie comics taking legal action against the owners of veronica.org for trademark infringement (the site is for the owner's two-year-old daughter)... AOL building Dragon System's speech recognition into their software (just think, "You've Got Mail" becomes the beginning of a conversation)... Folks at EA sneakily put "The Spirit of Christmas" South Park cartoon on copies of Tiger Woods golf game (though, apparently, it's fairly tricky to get at). Other folks at EA find out about it and are pissed... Probably too good to be true, but worth reading anyway: http://dailynews.yahoo.com/headlines/tc/story.html?s=
v/nm/19990115/tc/pagers_2.html ...

The Pew Research Center for the People and Press received a bit too much press for their study showing that the Internet isn't just for geeks any more. More and more, the demographics are matching the demographics of the U.S. as a whole (I imagine it's tough not to, when you're up to 74 million U.S. users)... A new study from the Travel Industry Association of America showed that in 1998 nearly one-half of all travelers booked their travel arrangements online... Patricia Seybold rated the top three e-commerce sites as eToys, Amazon, and Eddiebauer.com (I really want to see which are listed as the worst)... The Marketing Corp has released a study showing that over $8 billion worth of goods were sold online during the holiday season... Zona Research has shown that only 2% of online buyers are willing to pay the extra amounts for faster delivery of products purchased online... 43% fewer venture backed companies went public in 1998 than in 1997...

Sarah Flannery's discovery of a method for encrypting email data up to ten times faster than RSA. Yes, it's big news, but the flurry of reports (many of whom misunderstood the details) was a bit overdone... Cyberstrikes. Brazil is the latest country to have one... Joe Firmage portrayed as a loon. Once again, possibly true, but news outlets went a little overboard...

Blaming the Y2K problem on stupid mistakes that should have been prevented. This week, the US Labor Department accidentally released data prematurely on their web page (twice!) and blamed it on Y2K...

Too much free time:
Weird obsessions: http://ezzell.org/Error_Contest/Error_Contest.html

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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