European Net companies have leg up on U.S. peers
European Internet companies will be more successful in Europe than their U.S. counterparts because they have the crucial advantage of local knowledge. So said Mark Odendall, head of Credit Suisse First Boston's European technology group.
He said that although U.S. companies bring capital, it is more important to have knowledge of the local market.
For instance, CSFB sees U.K. online auction house QXL.com PLC (QXLC: news, msgs) as more successful in Europe than U.S. rival Ebay Inc. (EBAY: news, msgs). Local knowledge is also the reason why America Online is "far, far behind" Freeserve PLC (FREE: news, msgs) in the U.K. he said.
To succeed in Europe, companies need local content, local customer services, and local management, Odendall said. They must understand what consumers in Europe want.
"AOL (AOL: news, msgs), Yahoo (YHOO: news, msgs), Lycos (LCOS: news, msgs), and Amazon.com (AMZN: news, msgs) are all present but flagging in Europe," he said.
The Net companies that will be the winners in Europe need a huge target market, a compelling product, a great business model, attractive expansion opportunities and a competent and experienced management team, Odendall said.
"We saw this with QXL and Freeserve," Odendall said. CSFB helped bring the two U.K.-based companies to the market.
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