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: Ted Murphy who wrote (6116)	11/29/1997 10:56:00 AM
From: Steve Robinett	Read Replies (1) of 13594

Ted, A search engine like Yahoo (also way overpriced) is different than most "static" web sites. People go back to a search engine again and again and again. Just tracking on stock news during the day, I must pull up Yahoo a hundred times. That kind of repeat behavior makes advertising on Yahoo worth considering. As I mentioned before, "Other Revenue," which includes advertising as well as any vendor fees, currently amounts to 16% of AOL's total revenue. If, as you suggest, AOL got out of the ISP business and just became a web site, AT LEAST 84% of their revenues would vanish. Subscriber revenues more or less pay the bills while AOL gropes for a way to leverage that subscriber base and make a living. BTW, I agree with you about preferring AOL to AMZN. AOL is overvalued but AMZN at a market cap 14x sales is way, way overvalued. To paraphrase a rule of thumb that was popular when I was in the army and apply it to most of the internet high-flyers, I'd say, "short 'em all and let God sort 'em out." Best, Steve

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