Dear Mr. Chen:
Of all the comments I have seen on Techstocks.com regarding Netscape, yours seem by far to be the most thoughtful and informed.
I would like to see more from you.
I doubt I know more than you or enough to contribute anything to this forum, so I'll just describe my history with Netscape the stock for you and anyone else who cares to read it:
I was one of the "suckers" who bought in the initial public offering after-market at 71.
I bought 100 shares and stuck them in a safety deposit box.
I bought because I had just recently been introduced to the Internet and the one
piece of software best suited to accessing the World Wide Web: Netscape Navigator. Every computer-savvy person I knew said that, unlike a
lot of over-hyped IPO's, Netscape is a big deal. Some said it was the next Microsoft. I also read up on the people running it and, although they are not Bill Gates and are not connected to people like Warren Buffett the way Bill Gates is,
I liked what I saw.
All the experts said the public is usually left holding the bag in IPO's and that this was the worst example.
All the experts said Netscape was overvalued. I specifically recall that the Wall Street Journal said
Netscape would be "dead money" for about the next two years. I hunkered down with my 100 shares for a long wait.
As it turned out, all the experts, including the Wall Street Journal, were wrong.
The stock went down to the mid 40's. I thought about buying more but decided to defer to
the experts. Big mistake.
Then, the company started reporting earnings and all of a sudden the stock turned around.
All of a sudden Netscape was a stock all everyone had to own. Now it's at 140 and change.
That's not a level I'd feel comfortable buying at, but, having doubled my money on paper in the last six
months, I'm not complaining.
I don't know what the stock will do after it splits, after the lock-up ends and after earnings come out in February.
I do believe that, in ten years, Netscape will be a major force to be reckoned with in the world of computing and the internet.
On that basis, I am inclined to stick with it.
At some point, I have no doubt Wall Street will sour on Netscape and the proce will go down. At that point,
if I am able, I will buy more.
For now, I think I'll leave my 100 shares in the safety deposit box and just enjoy the ride.
The worst that could happen is that the stock could go to zero and I'd be out my seven grand.
Not a pleasant thought, but that's the risk you take in the Stock Market. It comes with the territory.
On the other hand, if all the people who say Netscape is the next Microsoft turn out to be right,
maybe I'll make some serious money for not a lot of work. Not a bad deal if it turns out that way.
Jerry Lampton
grlampton@pacificnet.net
P.S. -- As one of the "suckers" who actually laid out 40 bucks for a Navigator 1X in Netscape's Virtual
Store, I also think Netscape's letting the public "evaluate" their products is a great marketing ploy.
The fact Bill Gates (who is no business fool) is imitating Netscape in this regard confirms my impression. The ploy ferrets out bugs inexpensively and,
more important, familiarizes people with the company's product. Since, in matters of software, most people like what they are used to using, most people will probably like Netscape after they "evaluate" it for a while.
Most people who use the product for free will probably also eventually tire of downloading betas and fork out at least some money to buy the product, either directly
from Netscape or indirectly through their internet service providers' monthly fees. So I do not view the fact Netscape is "giving away its product" as a negative. |
