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User Values Soften Thanks To Amazon's Drop

Amazon (NASDAQ:AMZN) found Wall Street's jungle after all the past week as value per user for the book nerd fell 24% as investors got a little nervous putting positive earnings out farther than they can see at the moment, which is about two feet.

While I would put forth that Amazon user are probably worth more than the average browser at any of the other top 10 Web sites the question is how valuable? All browsers are not buyers but I would still allocate a premium to Amazon users over many of the others based on the fact users are on Amazon for a commerce experience.

Compare that to users on AOL who may be there for biological reasons in the chat rooms or for news.

On a value per unique user basis AOL is held at a premium to the peers as the online service provider wraps so many elements into the AOL service that "invisible" commerce can happen. That occurs when a marketing message that some firm paid handsomely for peeps out at you from the AOL window. Let's see the table:

Internet.com's March 4-28-99 5-5-99 4-28-99 5-5-99 Percent
WEBDEX Users Market cap or PMV* Market cap or PMV* User User change
  (millions) (millions) (millions) Value Value  
AOL.com* 47.0 $22,250 $21,000 $473 $447 -5.6%
Microsoft.com* 32.0 $8,500 $8,350 $266 $261 -1.8%
Lycos 31.9 $4,184 $4,084 $131 $128 -2.4%
Yahoo 31.3 $34,789 $32,345 $1,112 $1,034 -7.0%
GO Network (SEEK) 23.8 $3,238 $3,372 $136 $142 4.1%
GeoCities 21.3 $3,737 $3,494 $175 $164 -6.5%
Excite 18.9 $7,906 $8,599 $419 $456 8.8%
Time Warner web sites 13.3 $1,850 $1,800 $140 $136 -2.7%
Blue Mtn Arts 11.1 $750 $725 $68 $65 -3.3%
Amazon.com 10.7 $31,172 $23,601 $2,904 $2,198 -24.3%
TOTAL 241.2 118,376 107,370 5,824 5,031 -13.6%
AVERAGE 24.1 11,838 10,737 582 503 -13.6%
MEDIAN 22.5 6,045 6,217 221 213 -3.6%

Of the group the one I think most undervalued could be GO/Infoseek (NASDAQ:SEEK) which climbed 4% since April 28 but which still hasn't popped on the Disney brand and marketing. While Disney (NYSE:DIS) itself may be undergoing post-traumatic 'we're a big media firm now what do we do' disorder, I still see tremendous potential in GO.com.

A handful of Infoseek execs walking out last week I saw as a sign that media was winning over technology. Infoseek has always been a great technology firm but now the media-ness needs to be let loose.

Is the value of a Time Warner Web site user less than GeoCities (NASDAQ:GCTY)? In my view yes. The advantage of a GeoCities is it's a Web-centric property vs. a marketing outlet for offline media much as Pathfinder was/is.

On Blue Mountain Arts, a private firm, the debate is whether to allocate potential to the electronic greetings outfit or to value it as is off the shelf. I tend to focus on value per user, a real person, and believe that if offered value in one realm that the same user could possibly be offered more services than just egreets.

Strip away Blue Mountain Arts and you have 11.1 million unique monthly users (see mediametrix.com for definition) who may enjoy more than just emailing friends and family cards. Simply put it's a user and traffic machine.

Excite (NASDAQ:XCIT) gains 8.8% to $456 per user as its pending merger with @Home (NASDAQ:ATHM) gets governmental approval.


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