America On-Line: will it survive ...? Message Board

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Technology Stocks : America On-Line: will it survive ...?

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To: Yikes who wrote (10194)	6/5/1998 4:55:00 PM
From: jack rand	of 13594

Wrong re. "The Excite stock sale has only one problem." See Harry L's 10189. What you describe is precisely why cap gains from sales CANNOT be taken as operating revenue. As to ANS, consider that as part of the deal AOL contracted with WCOM for $1.6 billion of service over five years -- yet ANS annual revenue, 90% of which was from AOL, was only at runrate of $46 million. And book value of ANS was only $45 million. Yet AOL claims a profit of $380 million on the sale of ANS. Sale of MCI's backbone service (similar to ANS's business) a few weeks ago was at 3 times sales. By AOL's accounting, the gross from sale of ANS was $425 million, which is nine times. Find a sale of an ISP within the past two years that has been anywhere near nine times sales and nine times book value.

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