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What's a User Worth? WebSite Value Index Up On Renewed Stocks

Funny what a simple coupling can do. CNET's decision to marry off its Snap! offspring to NBC prompted Wall Street to reawaken its zeal for Internet shares.

That pushed up Mecklermedia's WebSite Value Index with the top 10 public and private sites getting reevaluated by traders and investors.

One day shares zoom, the next they drop. It's not fundamentals, it's emotional schisms and a combination of Olestra potato chips--tastes like fat but Wall Street just isn't sure if it's manna or mania.

Given AOL's near $20 billion overall market capitalization, we think any one of these top 10 sites could reach the $10 billion mark within 36 months. Yahoo! is our favorite candidate to do so, if it can keep pace with the dynamics at play here.

The latest:

- Mecklermedia's WebSite Value Index -

Monthly

June 3

June 10

Percent

June 3

June 10

Percent

Unique Users

Market cap or PMV*

Market cap or PMV*

change

User Value

User Value

change

(millions)

(millions)

(millions)

(sorted by users)

Yahoo

32.9

$4,721

$5,297

12.2%

$144

$161

12.2%

Netscape.com*

21.1

$1,375

$1,450

5.5%

$65

$69

5.5%

AOL.com*

19.7

$1,650

$1,750

6.1%

$84

$89

6.1%

Excite

19.2

$1,289

$1,477

14.6%

$67

$77

14.6%

Microsoft.com*

18.8

$1,750

$1,750

0.0%

$93

$93

0.0%

Infoseek

16.2

$697

$816

17.0%

$43

$50

17.0%

Lycos

15.0

$792

$827

4.4%

$53

$55

4.4%

MSN.com/Hotmail

14.9

$700

$800

14.3%

$47

$54

14.3%

GeoCities*

14.2

$375

$400

6.7%

$26

$28

6.7%

Disney.com*

9.0

$450

$600

33.3%

$50

$66

33.3%

TOTAL

181.0

$13,799

$15,167

9.9%

$672

$742

10.5%

AVERAGE

18.1

$1,380

$1,517

9.9%

$67

$74

10.5%

*PMV=estimate of private market value.  (c) 1998 Mecklermedia, The Internet Media Company.

We reiterate the point about the gap between private and public values--a term we dub 'Webitrage.' Look at GeoCities. We estimate the Websteader may fetch $400 million total or $28 per user if sold privately. Given Inktomi's home-run IPO on June 10--the stock doubled on its first day of trading to $36--GeoCities could launch at $450 million and trade upwards of $600 million its first day by our rough estimates.

It all depends on the flotsam and jetsam factor. How many home page builders and pages are homesteaded or just passing through? Bottom line: Can GeoCities leverage users into revenue? Easier said than done.

And now for the Internet Stock Report Question Of The Week: Which of the top 10 is your favorite site and why? Click and e-mail us now--answers next Monday.



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