The running of the bulls and now the stampeding of the cows. The average
value per user for the top 10 Web sites in Mecklermedia’s WEBDEX shows a
drop of 4.5% the past week. We think some of these stocks simply got ahead
of themselves, with an underlying sense of frothy valuations.
Consider
that Web networks are up 400% to 500% from their 52-week lows, and
maybe enough’s enough until they can show revenue flow results. If they
back it up, then watch out for the bulls.
Mecklermedia’s | June | July 8 | July 15 | July 8 | July 15 | Percent |
WEBDEX | Users | Market cap or PMV* | Market cap or PMV* | User | User | change |
website value index | (millions) | (millions) | (millions) | Value | Value | |
Yahoo | 30.4 | $8,618 | $8,413 | $283 | $276 | -2.4% |
AOL.com* | 23.2 | $2,900 | $3,000 | $125 | $129 | 3.4% |
Excite | 18.9 | $2,259 | $2,182 | $119 | $115 | -3.4% |
Netscape.com* | 18.5 | $1,900 | $1,800 | $103 | $97 | -5.3% |
Microsoft.com* | 18.0 | $2,400 | $2,300 | $133 | $128 | -4.2% |
MSN.com/Hotmail | 15.2 | $1,450 | $1,350 | $95 | $89 | -6.9% |
GeoCities* | 14.8 | $525 | $500 | $35 | $34 | -4.8% |
Lycos | 15.0 | $1,436 | $1,282 | $96 | $85 | -10.7% |
Infoseek | 12.0 | $1,080 | $985 | $90 | $82 | -8.8% |
Disney.com* | 10.0 | $1,250 | $1,150 | $125 | $115 | -8.0% |
TOTAL | 176.1 | $23,818 | $22,962 | $1,205 | $1,151 | -4.5% |
AVERAGE | 17.6 | $2,382 | $2,296 | $121 | $115 | -4.5% |
We believe the window for Netscape to become a significant force with
Netcenter is closing, and that more alliances may be needed to extend its
demographic with the wider offerings of the Web. Its release of
Communicator 4.5 may help.
Unfortunately, its stock isn’t as valuable a currency as it once was, so
buying growth may be harder than it thinks, if that’s the route it
chooses.
While we like GeoCities’ user base, we find its business model
looking thin. Its users don’t want ads thrust on their Web sites any more than a
pile of junk mail dropped in their mailbox (snail or e-mail). Imagine
creating your masterpiece Picasso and having big brand x slap an ad on it.
Only Andy Warhol could do that. GeoCities? No.
For better or worse (mostly worse in terms of stock price lately), Infoseek
(NASDAQ:SEEK) and Disney (NYSE:DIS) are joined at the forehead with their
Web efforts. Somebody’s crying siamese twin circus act. We think DisneySeek
just hasn’t unleashed the magic kingdom. You want to buy into Disney’s Web
presence? SEEK is it. Fantasy or Fantasia?
…We promised you highlights from Mecklermedia’s (NASDAQ:MECK) Summer
Internet World and here’s a glimpse of what’s hot from the largest Internet
trade show in the midwest:
package, privately-held WellEngaged announced a series of customers
including AT&T, CIO, Upside, T3 Media, and XOOM for its software and
know-how to enable message board discussions.
WaterhouseCoopers announced its latest venture capital survey. We’ll give
you a more in-depth look at the session and who said what next week in
Internet Stock Report. For now chew on this: First quarter 1998 posted
record results–$460 million, 101 deals, up 54%. At that pace, 1998 will
break records.
serves weather info to more than 1,000 Web sites. Like sports or business,
weather is one of those core offerings that people consume. This one is on
our radar if it goes public.
up commerce opportunities for those who use its software.
and instantly chat with company representatives or customer support. While
not the only firm doing this, we believe that Web-based customer support and
sales with live people via chat (and voice over IP via PC) may be
commonplace in 12 to 24 months.
