eMailbag: eCommerce, PSINet, Euro Chance & More
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First reader up this week:
"I just read the press release from PSINet (NASADQ:PSIX) concerning the agreement to provide businesses with Wireless Internet Access in Southwest Florida. It seems that PSIX believes there is a lot of potential for wireless Internet services, especially for businesses in large metropolitan areas.
I would like to know your opinion on wireless Internet access. Is it a viable alternative to 128+ K leased lines? Will it garner a substantial share of the Internet access market for businesses in the coming years? It seems that they have addressed most of the earlier disadvantages of wireless access."
PSINet's agreement with Airdata WIMAN Systems, Inc., and Wireless One Network in Florida, operates in the unlicensed 2.4 GHz. - 2.4835 GHz. spread spectrum band at speeds of 115.2-128 Kbps.
Given the voice crackle of cell networks, however, we wonder how the quality and actual speed of this service will be, especially with the sensitivity of packet-based data?
I work at a Swedish investment bank, with the corporate finance department. My focus is IT-companies. I have begun to have contact with a great deal of Scandinavian Internet Retail companies that are quite successful and are now looking for venture capital.
I am very interested in your view of the global Internet Retail market. Do you think that European companies stand a chance against their U.S. competitors. "
Reply: Internet retailing, "e-tailing" if you will, operates on many levels from global to local. European start-up companies do stand a chance in the global arena but they must understand the dynamics at that level--who they are selling to, who's on the Web, and what marketing and sales would reach them effectively.
Fulfillment, virtual warehousing, and a number of other issues must also be dealt with. Unfortunately, European venture capital is scarce which often hinders any great ideas from getting off the ground.
"Do you ever look at non-Internet specific companies in your stock index column? Perhaps electronic commerce companies that have a large play in the Internet space, such as Sterling Commerce (NYSE-SE)?
Sterling Commerce Inc., is the leading global provider of business-to-business EC software solutions and value-added network services. After helping establish the industry 25 years ago, Sterling Commerce is increasingly being recognized as an Internet commerce pioneer."
Reply: I fully expect established electronic commerce companies to focus on the Internet as the future of their services. If they don't, new companies will emerge and take their place in the food chain. Similarly, I believe EDI will also be absorbed into the Internet or Internet-based network.
ISDEX Mutual Fund?
"Is ISDEX, Internet Stock Index, also a mutual fund?
Reply: We get requests regularly from readers to make ISDEX a mutual fund. In order to get the kind of necessary exposure and trading in it, we'd like a company such as Fidelity to pick it up.
The Novell article (ISR, February 27) is really commendable because of its most accurate analysis in terms of the company's technology, vast number of users, and yet lack of recognition by investors because of marketing weakness.
Reply: Another example of how Microsoft outmarkets a rival. Novell seems to need that revival and paranoia that turned Microsoft around in 1994.