You’ve Got More Than Mail: AOL Leads WEBDEX Ranking

First
of all let’s get the usage and reach stats out of the way:Yahoo!
(NASDAQ:YHOO) ranks third in overall unique users according to data from
Media Metrix. That’s counting the consolidated Web sites of each of the top
10 shown. AOL (NYSE:AOL) and Microsoft (NASDAQ:MSFT) come in at the top two
slots. These stats reflect home and work combined reach.

Is that bad
news for the Yahooligans? Not if we look further. Yahoo ranks first in work
usage while AOL drops to fourth, behind Lycos (NASDAQ:LCOS)–one reason why
AOL wants to acquire Netscape (NASDAQ:NSCP), to boost the work side.

The
jostling in the usage and reach have a direct bearing on what WEBDEX is all
about: counting the market cap divided by unique user, looking for
“user-trage” (arbitrage in user disparity). And there’s tons.

AOL’s bid
for Netscape, for example, drew out the value of Netcenter users rather
quickly as it gained 12.7% the past week.

Alta Vista, part of Compaq
(NASDAQ:CPQ), finds some upside in our private market valuation of it based
on its relative discount. Yet being part of CPQ makes getting at AltaVista
value from an investor perspective almost impossible. Nobody buys CPQ stock
for AltaVista. Yet we’re coming into the belief that AltaVista’s value may
become pronounced if Compaq focuses a little on it, ups the ante or spins
it off. We favor the spinoff.

Lycos now counts 51% more users than Excite
(NASDAQ:XCIT). Its buying binge put it out ahead. Can Excite afford not to
acquire traffic/users now?





















































































































































Internet.com’s

November

Dec 28

Jan 6

Dec 28

Jan 6

Percent

WEBDEX

Users

Market cap or PMV*

Market cap or PMV*

User

User

change

 

(millions)

(millions)

(millions)

Value

Value

 

AOL.com*

30.35

$6,000

$6,500

$198

$214

8.3%

Microsoft.com*

27.75

$6,900

$7,500

$249

$270

8.7%

Yahoo

27.28

$27,189

$28,719

$997

$1,053

5.6%

Lycos

25.66

$2,649

$2,834

$103

$110

7.0%

GeoCities

18.16

$1,197

$1,075

$66

$59

-10.2%

Excite

17.02

$2,606

$2,631

$153

$155

1.0%

Netscape.com*

16.99

$2,750

$3,100

$162

$182

12.7%

Disney.com

14.51

$2,750

$3,000

$190

$207

9.1%

Infoseek

11.49

$1,761

$1,645

$153

$143

-6.6%

AltaVista

10.91

$500

$600

$46

$55

20.0%

TOTAL

200.1

$54,302

$57,604

$2,316

$2,449

5.7%

AVERAGE

20.0

$5,430

$5,760

$232

$245

5.7%

AVG. without Yahoo

19.2

$3,013

$3,209

$147

$155

5.8%

) 1998 internet.com *PMV=estimated private market value for Web site only;
users, media metrix


Another way of looking at WEBDEX is this: we break out this handy
comparison of how each of the top 10 rates in percent vs. the average for
the group. Percents tell a nice story. While all users are not valued equal
brand and growth offer some insight to Wall Street’s treatment or leaning
towards some vs. others. Management also counts, along with earnings (yes,
even for Internet companies).

























































Firms compared to

Percentage

WEBDEX average

of avg. value

 

 

AOL.com*

87%

Microsoft.com*

110%

Yahoo

430%

Lycos

45%

GeoCities

24%

Excite

63%

Netscape.com*

75%

Disney.com

84%

Infoseek

58%

AltaVista

22%



The percent table shows Yahoo users trade at 430% of the average for the
top 10, with some justification owed to the pent-up expectations of
greatness that having a global leading brand provides. Nothing more in our
view. Revenue-wise, Netscape.com generates top line in league with
Yahoo.

But Yahoo’s consolidated under one umbrella approach so far has
worked we believe, thanks to its history and memorable name.

Microsoft’s
(NASDAQ:MSFT) challenge at #2 reach/users seems to still be integration
among its Web assets HotMail, MSN, Expedia, Investor, CarPoint, Home
Advisor, and more.

While we show a blended value per Micrsooft.com(s)
sites we also believe that a customer on Expedia is worth more than a
software surfer downloading freeware versions of FrontPage.

Disney.com
sites enter the list again after October’s jostling with Infoseek
(NASDAQ:SEEK), which it owns 43% of. How these two mesh will become evident
as their combined effort go.com gets going.






Internet professionals who have been waiting for “Steve Harmon’s 10 to
Watch for ’99” can now subscribe to Internet Stock Report’s Monthly
HotWatch–by Steve Harmon.


ALL NEW! Internet Stock Report is now offering a monthly e-mail
subscription for $99, featuring Steve Harmon’s monthly top 10 noteworthy
Internet stocks. Subscribers will receive in-depth analysis each month on
the top 10 Internet stocks. Month to month, Steve will keep you informed
and up-to-date with the fast-paced nature of Internet stocks. For $99 per
year, you will receive 12 timely issues sent to you by e-mail. Don’t wait,
our February issue will be out before you know it with a whole new
perspective on the market.

News Around the Web