Phone.com, Software.com Go Wire to Wire

Following their announced $6.8 billion merger, shares of both
Phone.com and Software.com soared Wednesday, with Software.com climbing 32% and Phone.com up nearly 17%. The multibillion
dollar merger marks a first mover mega-consolidation in the burgeoning
wireless Internet market, and investors jubilantly cheered the marriage
proposal.


The two wireless infrastructure players will each own approximately 50% of
the combined entity, with recently departed Cisco Systems’ Executive VP, Donald Listwin, taking the driver’s seat at the
wireless Web juggernaut as the newly appointed CEO. Listwin’s departure
from Cisco makes the deal even sweeter for giddy investors eager to
speculate over his defection from the networking giant.


While Phone.com focuses on Web access for mobile devices via its WAP
standard, Software.com targets the world of e-mail, voice, and fax
communications. Software.com supplies large-scale messaging solutions to
ISPs and global telecom carriers, enabling these providers to offers its
millions of subscribers reliable e-mail and instant messaging communications.


Without too much noticeable overlap, the dynamic duo of Phone.com and
Software.com bring to the table enormous opportunities in wireless
infrastructure solutions. Enabling wireless applications from Internet
access, to mobile e-mail and unified messaging, the as-yet-unnamed new
entity enjoys an almost immediate dominating presence in the next phase of
the Internet revolution – the World Wide Wireless Web.


Most Valuable Player?


In the private sector, high-profile MVP.com has set its sights on
struggling outdoors gear e-tailer, PlanetOutdoors.com. Sports
e-tailer, MVP.com, debuted just this past
January, amidst all the bells and whistles accompanying its all-star
backers, Michael Jordan, John Elway, and Wayne Gretzky. This acquisition
finally ends the saga Boulder, Colorado-based PlanetOutdoors.com has been forced
to endure since the market turned sour on profitless e-tailers early this
year.


Caught in the crossfire, PlanetOutdoors found itself flatfooted when VC
cash dried up overnight. To avoid becoming just another victim in the
dot-com boneyard, its management team tightened the belt in May, sending 22
of its 100 employees to the bread lines. Besides cutting 20% of its
workforce, PlanetOutdoors also eliminated all of its temp workers,
independent contractors, as well as slashing marketing budgets.


The about-face appeared to do the trick, since less than two months later,
the niche player successfully avoided becoming just another dot-com
casualty. Seeing the writing on the wall that the current IPO market would
spit out a solo contender like PlanetOutdoors, the e-tailer folded itself
into the much more appealing MVP.com brand. Now that MVP.com has rescued
the e-tailer from the brink, PlanetOutdoors’ original VC investors, which
include [email protected], will pony up additional funding into the newly
expanded MVP.com.


AltaVista Manifest Destiny


CMGI says it is looking for an ISP target
acquisition to help boost traffic to its tired Web portal, AltaVista. Set to tap the public
markets earlier this year, AltaVista had to withdraw its planned offering
yet again after the Nasdaq’s nosedive. The most recent on-again, off-again
plans for AltaVista are only one in an ongoing soap opera of botched IPO
attempts for the search portal, dating back to 1996.


AltaVista’s sights are set on Europe, according to CMGI’s European
president Marcus Bicknell, who indicated that they’re seeking a telecom or
ISP acquisition in the UK, France, or Germany. As t

he only major Web portal
still privately-held, AltaVista continues to be on the outside looking in
according to the most recent Media Metrix study. Idle in the number nine
spot, the search portals lags behind Yahoo! ,
Lycos , [email protected] ,
Go.com, now Walt Disney Internet Group , and even
About.com .


But, with half of AltaVista’s Web traffic derived from outside the U.S.
borders, such an acquisition is a sound move, as AltaVista circles for yet
another IPO run. If such a deal materializes, it should beef up AltaVista’s
current slim European ISP presence, which includes its recently launched
free, unmetered Web access in Britain as well as its free German version
currently in the registration process. Unfortunately, the landscape for
me-too portal players is looking anemic and should only get leaner. That
means at best, Alta Vista will continue to fight for little more than
scraps left over from the likes of Yahoo! and Lycos.


Any questions or comments, love letters or hate mail? As always, feel
free to forward them to [email protected].


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