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Technology Stocks : AUTOHOME, Inc
ATHM 21.05-3.3%Feb 12 3:59 PM EST
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To: Solid who wrote (15025)8/31/1999 2:37:00 AM
From: tom offenbach  Read Replies (1) of 29970
 
Solid - <'Ubiquity in access availability and speed.' That is one heck of an assumption>

You are correct about that...however, the efficiencies that result will more than pay for the access. BTW - I am not assuming that T or the MSO's will be giving this(local loop) away for free...there is an associated cost to this type of service and it will be paid for by someone or something. This concept is evidenced by companies such as FreePC, FreeServe, Hotmail and Gateway. I bet that in the next few years the majority of the Internet access market will be subsidized by companies which are currently viewed as non-technology or non-internet companies. Think about it...the economies of scale and potential efficiencies that can be achieved for a company such as BofA to subsidize your Internet access($20/month) in exchange for you receiving customer service and your account information online is staggering and revolutionary. TJ has made a point of continually saying that he envisions a scenario in which the cost of broadband connectivity decreases to $0. T is a +$100B infrastructure company and should position itself as such. ATHM is a new media company and is hedged against declining access fees through a strategy of scaleable facilitation. Take a look at the investments made by ATHM. The companies in which they invest or buy have nothing to do with access. It would appear as though they assume broadband local loop will be a true commodity - this also assumes that T will continue to be an infrastructure company sell broadband loops on a wholesale basis. The idea of T creating a consortia of MSO's and establishing company which resells HFC loops has been discussed here before and should be brought up again because it's viable and probable.

<To me the real question is not will yesterdays first out of the block, AOL, be the first of the future because it's
now great at Ecommerce, but will it even be around without the access and visibility it may lose to new comers
that blow it out of the water like T/ATHM?>

To me the real question is whether or not AOL can leverage it's current market position to offer services that are truly valueable(drive efficiencies) to/for the customer. ATHM is doing this right now. They've purchased iMall(enabling eCommerce), did a deal with General Magic(enabling integrated voice mail and email), and are preparing for the launch of the work.com service. This is where the value of ATHM lies....but is dependent upon execution and the ability to distance itself from the viewpoint that its core value is a function of the ability to maintain exclusivity with the MSO's.

Last but not least....I've copied a link to an article in SJ Mercury about how Microsoft is considering getting into the software rental 'business.' Maybe Microsoft will be the subsidisor or broadband connectivity :)

sjmercury.com
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