I just got this from Web Stock Wizards, they make a strong case for RNWK!
Real Networks can't seem to shake profit takers. After posting
impressive earnings with revenues strong all across the board, CEO Rob
Glaser's testimony against Microsoft causes Real shareholders to send the
stock tumbling from its recent $44 high. We think this is an overreaction.
Although no one can predict what will actually happen with the proceedings,
let's examine the situation. Real Networks owns 85% of the media player
market and their new G2 technology is ranked far superior to that of
Microsoft's. Can one claim a similarity between this situation and
Netscape's a few years ago? We don't think so. Netscape charged for their
browser from day one and has been charging for it until only recently
whereas Microsoft's Internet Explorer has been free for quite some time now.
Real has always given away their players for free and knew to generate
revenues via licensing and content placement fees. Real's RealPlayer
continues to be downloaded at a rapid pace. Microsoft is a current investor
in Real Networks. Real recently posted earnings showing their clear
dominance of the media player market, and lastly, in his testimony, Rob
Glaser, Real's CEO, only aimed to have Microsoft change their ways, not
completely back out of the media player market. Using these facts to
compare the current situation with the Netscape-Microsoft rivalry years ago,
and one can see that Real continues to have the upper hand. As for those
who understand the actual software debate behind the proceedings you will be
happy to know that I happen to be using a PentiumII300mhz with Windows '98
and Real G2 Player and everything works together cohesively. To show just
how irrational investors in the internet are, think about the fact that it
has been public knowledge for well over six months now that Microsoft has
had a rival media player and that they intended on promoting it against that
of Real Networks. If anything, we would view Rob Glaser's testimony as a
move forward that would make Real's stock be more valuable. He is clearly
documenting Microsoft's monopolization years before broadband access will
cause the media player market to become extremely valuable. Oh well, Mr.
Glaser watched his company's market capitalization sink by 25% last week as
individual internet investors still don't do their homework. |
