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.