To expand on the idea that MSFT's market cap is $518 for each of the 56 million visitors that MSN gets each month, suppose that you consider, somewhat arbitrarily, that MSN represents only 10% of the total value of MSFT. I don't really believe that; I think MSN is basically worthless, if not a net negative for MSFT's value. But just suppose it's worth 10%. So then each "unique monthly visitor" represents about $52 of MSFT's market cap. Let's ignore, for now, that many of those "unique visitors" are really just multiple hits from single users with dynamic IP addresses, and many others are hits from headless "bots" that are just gathering spammable email addresses and data for search pages. If $52 per monthly visitor is really a reasonable value, somebody should contact Lars' mother:
dybdahl said "My mother's personal homepage had 8,000 unique visitors in a month."
So by MSFT's metric, her homepage is worth $52 x 8,000, or $416,000 !! Lars, maybe she should sell her page to MSFT.
So at least one of these two conclusions must be true: (1) MSN is absurdly overvalued in the stock market, and/or (2) MSN is worth considerably less than 10% of MSFT's value.
That's why I'm not too excited one way or the other by wild-eyed reports that MSN has purchased yet another dot-com business, or that HotMail has increased its user base, or that some dot-com has announced a strategic alliance with MSN. Who cares?
Dave |
