E-Mailbag Monday: Y2K, OpenTV

With Y2K, what do you see for the market next year?

Reply: I’m sure during January, the press will be chock-full of
stories about Y2K. There will probably be real problems; however, it will definitely not be the end of the world. Billions and billions have been spent on the problem (some estimates are about $100 billion or $365 for every American citizen).

However, perception is reality. As the press is wont to do, things will be blown out of proportion, which will likely spook investors. So, I would not be surprised that January is a rocky month, as well as February. But once the press subsides, the markets should start to rally. In other words, this could be a buying opportunity.

Interestingly, there is talk of a so-called “Y2K Dividend.” That is, with no more need to spend on Y2K remediation, money can be spent on more productive things.

IPOs for the Week

What’s good for the upcoming week in IPOs?

Reply: With the holiday next week, expect a slow week. In fact, there are only 11 IPOs planned. But, there is one to keep an eye on: OpenTV. The company develops sophisticated software for interactive TV. The price range has been raised from $14-$16 to $18-$20 as well as the shares, from 7 million to 7.5 million.

OpenTV had revenues of $17.6 million for the first nine months of this
year, up from $6.1 million in the same period last year. As for losses, these are falling, going from $10.6 million to $8.5 million this year. The company also has an all-star list of investors, such as AOL (AOL),
Sun Microsystems (SUNW)
, News Corp and Time Warner.

Merrill Lynch is the lead underwriter and the proposed ticker symbol is OPTV.

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