levy, another bad review, but one that offers some slight solace, from Forbes.com:
biz.yahoo.com
Tuesday January 23, 2:51 pm Eastern Time
Forbes.com
Wireless Act: Openwave, InfoSpace Break Out
By Mark Lewis
Wireless Internet stocks are a hot play again--at least for today. Openwave Systems and InfoSpace are both among Nasdaq's most heavily traded issues.
The trouble is, they're moving in the opposite direction, with Openwave up 15% and InfoSpace down 13%. So where are these stocks heading?
To some extent, the two companies' markedly different performances are due to news events. There is a case to be made, though, that Openwave has a stronger business model and is simply a better pure play.
Openwave (Nasdaq: OPWV - news) popped today after surprising Wall Street with a nice little operating profit for the recent quarter instead of the expected loss. Revenue came in at $109.7 million, up from a combined $29.1 million a year ago for Phone.com and Software.com, which merged to form Openwave.
The outlook is murkier for InfoSpace (Nasdaq: INSP - news). Several analysts downgraded the stock today in the wake of yesterday's surprise management shakeup. Among the departures is Chief Executive Arun Sarin, who is stepping down after only nine months on the job. Sarin, who cited the desire to spend more time with his family, will remain on the board as vice chairman. Analysts doubted that he would continue to be a major factor.
Despite Sarin's departure, InfoSpace is not necessarily a bad bet to prosper--if and when the wireless Internet finally kicks into high gear. Openwave might still be a better bet because it's more of a pure play wireless Internet stock. The company sells the software that enables wireless carriers to provide Internet services via mobile telephones. InfoSpace sells content and services to a variety of Internet-related customers, only a minority of whom are wireless carriers.
``For a carrier to provide wireless Internet services, they need Openwave,'' says Peter Friedland, a wireless analyst at W.R. Hambrecht. ``InfoSpace is a less crucial piece of the strategy.''
The effect of Sarin's departure should not be minimized, either. He was viewed as a key driver to expand the company's international reach. ``Now he's gone, and I think that's a point of concern,'' Friedland says.
InfoSpace founder Naveen Jain is returning as CEO, but not even the famously persuasive Jain could convince analysts that this change boded well for InfoSpace. ``A year ago Naveen Jain was a visionary, and people sort of started to drink the Kool-Aid,'' says Matt Finick, a wireless infrastructure analyst for Thomas Weisel Partners.
Then the Internet bubble burst and InfoSpace collapsed from its 52-week high of $138.50 to yesterday's close at $7.03. While many investors remain convinced that wireless Internet is the next big thing, they are more particular these days about where they place their bets.
Finick has ``buy'' ratings on both stocks, but he has lowered his expectations for InfoSpace's 2001 performance. The company will announce its fourth-quarter results on Jan. 29. Last month, InfoSpace said it was comfortable with the current analyst guidance, but that was before Sarin's departure.
``I believe that the educated investor is investing in Openwave and probably lightening up on InfoSpace,'' Finick says. ``Let's be blunt here: Openwave has been executing on their model. With InfoSpace, you've got this question about whether they'll be able to execute.''
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