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-- Steve Harmon, e-harmon.com CEO
As one of the most widely-read Internet analysts on the Web, Steve Harmon looks at the sector with a different twist than other analysts. In today's Q&A, Steve digs into his e-mail bag to take your questions on Adobe Systems, MP3 digital audio, online mortgage/loan companies, Flash technology and more Check out this Money Talk exclusive!
Money Talk: MacroMedia says its job is to bring "Life to the Net" and has watched its stock price explode from a low of 12 to a high of over 50 in the last year. I would love to hear your opinion on MACR as well as your outlook for software developer Adobe Systems.
Harmon: MacroMedia {MACR} and Adobe Systems {ADBE} are two early multimedia stocks that took 3 years to get any sort of recognition in the Internet space. Why? They bet on new media and not the Internet per se and they paid the price.
Neither firm had the gumption to be an all-Net play back in 1994-98 even though the world went Net. Of the two companies, I want to focus on Macromedia because I think its "flash" technology holds extreme promise for next-generation Internet content and perhaps even e-commerce.
Flash and the other applications that Macromedia produces allow content to be more video and audio enabled, compelling, without a huge file size to clog your modem. At 10x run rate revenue, MACR has some Internet premium built in but this company also has positive earnings. Yes, a P/E for an Internet company... a novel idea in fact! I think MACR could double from now until this time next year if Flash takes over the Net. Once you see some examples of Flash technology, then plain old vanilla Web sites look like AM radio in a FM era. With or without broadband, Flash is one of the best Internet technologies I have ever seen.
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