Aitch, Richie, David and Steve:
I did put in a market order. My cost is about 44-7/16. I don't think CPQ will drop 2 points at the open so I should be able to "escape" without a loss, "WCS" with a small loss, or if Richie's "swimming upstream" scenario plays out - a small gain. I think we'll bounce off 42 - I'll look to get in later. Plenty of opportunities in a lot of stocks after the carnage is over - e.g. Mary Meeker "Internet Goddess" just said to get out of YHOO. If things turn on a dime so will I.
David - Those bid/asks you're looking at are from yesterday's close. You can't get bid/ask figures on NYSE stocks online before the open.
From Today's IBD .....
Maybe this is what Ben Rosen did with the $ from his big CPQ stock sale -
Investors Say 'Cowabunga' To Beach Site
Date: 1/13/99
Author: Doug Tsuruoka
Why would an elite group of more than two dozen private investors play beach-blanket bingo over a Web site featuring bikini-clad models?
It's not exactly clear, but these high rollers from Wall Street and technology have plunked down $2.8 million on a site called Bikini.com. The site is owned by a company aptly named Sunshine Media Corp.
New York-based Sunshine touts the site as the ''World's Biggest Beach Party,'' kind of a '90s take on those old '60s surf movies. In this case, though, Frankie, Annette and Moondoggie take the Dodge Woodie north to Silicon Valley where they hang 10 on the Internet.
Although more jaded cyber-audiences might find it less than serious investment material, investors in the project are gung-ho on Bikini.com's profit potential.
''It appeals to something that's in the American psyche,'' said investor Bernard Goldstein, a founder and ex-chairman of technology venture capital firm Broadview International LLC. Other investors include Compaq Computer Corp. Chairman Benjamin Rosen and one-time Drexel Burnham Lambert Inc. CEO Robert Linton.
Bikini.com's unabashed mission is to use beach themes and shapely women to sell as many products and ads as possible in cyberspace. The site's centerpiece is a bevy of models with pseudonyms such as ''The Ravishing Russian'' and ''The Asian Sensation.''
The Web site launched in July '97 with no advertising. That didn't seem to faze anyone. In fact, the company projects site revenue will hit $4 million this year, paltry by many standards, and the site is not expected to make a profit until '00.
''My decision to invest had nothing to do with the maniacal kind of pricing that's now being awarded to early Internet companies,'' said Goldstein, who has also been a board member of Apple Computer Inc. ''I think this is an Internet content site that's very appealing to the predominantly male, 15- to 25-year- old audience.''
Goldstein won't specify how much he's invested in the venture, except to say it's between $100,000 and $1 million. His commitment offers clues, however, on what motivates investors in the new Web economy.
It used to be that a Web site like Bikini.com - with its loud colors and blatant sex appeal - would be laughed off the Net by chic geeks worried about things like ''user affinity'' and ''cyber- aesthetics.''
But things have changed. In a market where more than a billion viewers have made ''Baywatch'' the most watched TV program in the world, taste pales in comparison to the power of pulling big bucks to big media.
As evidence, Bikini.com currently gets more than 6 million ''hits'' a week, or more than 28 million hits a month.
The company's president, Gail Sonnenschein, 37, is a veteran TV producer with a law degree who conceived and developed Bikini.com with her co-founder and brother, Howie Sonnenschein, 33. The pair invested nearly everything they had.
Gail Sonnenschein envisions the site as more than a Web page with a jiggle factor.
''We want it to be a category killer, a catalyst for building a major entertainment brand,'' she said. ''We're one place where everything is bright and happy and party all the time.''
The site is ''fun and wholesome,'' backers say, a sort of Gidget Goes Online. And all models keep their swimsuits on.
''This is a site I can be proud to show my mother,'' said Lola Corwin, the model known as ''The Asian Sensation.''
The company also started selling goods through its Bikini.com Surfshop in December. Sonnenschein says visitors who click into the online store eventually will be able to buy a wide range of beach gear and apparel.
Sonnenschein has enlisted the help of Carolyn Everett, a former director of online commerce at MTV Networks who now works as Bikini.com's chief operating officer. Everett, a media whiz who's won Emmy and Peabody awards, invested $200,000 of her own money in the firm.
Everett says there are a number of ways the company could profit.
''I saw the (Sonnenscheins) were building a brand that could generate six or more potential revenue streams,'' Everett said. ''Even if two hit, the company could be extremely profitable.''
Also, CPQ mentioned in this article -
First PCs, Then Servers - Now Dell's Doing Storage
Date: 1/13/99
Author: Michael Tarsala
Moving its direct sales strategy up the high-tech hardware food chain, Dell Computer Corp. is trekking into a new frontier -storage hardware.
Dell entered the fast-growing market for data storage hardware in June, adding to the company's line of midrange computers. After making additions to its storage line in December, Dell now has other computer makers on the lookout, analysts say.
Round Rock, Texas-based Dell plans to become a top storage hardware company, taking share from market leader Compaq Computer Corp. Dell has less than 10% market share today in storage systems based on Microsoft Corp.'s Windows NT operating software. But Dell hopes to be one of the top five players in the market by '02.
''We plan to price aggressively and drive volume to take share from our competitors,'' said Kevin Reinis, marketing manager for Dell's storage systems group. ''Our goal is to grow three to four times the market growth rate.''
Building market share might prove difficult, though. Competitors have more storage products and are more established. Given Dell's track record in other realms of enterprise computing, however, analysts aren't counting the company out.
''Everyone said, 'How is Dell going to sell servers? It's too complex for them,' '' said John McArthur, analyst at Framingham, Mass.-based International Data Corp.
''And they did it.''
Dell is known best for selling personal computers over the phone and via the Web. The company has a reputation for shipping hardware direct to consumers at lower prices.
Dell's enterprise division, which makes storage devices and other midrange computers, is somewhat of a secret, analysts say. But the division has grown fast and seen strong profits by peddling server computers and high-powered PCs known as workstations.
It's important for Dell to repeat its server success in the storage market, the next promising area for growth in high tech. Storage devices are large computers used for housing vast amounts of data. The machines range widely in price, from $10,000 to $1 million or more. Dell's devices hover at the low end.
The NT storage market is growing at more than 30% a year, analysts say. The need for disk storage is doubling annually at many large companies, according to Cambridge, Mass.-based Forrester Research Inc.
Dell expects to get most of its business from departments that simply need more data elbow room. Sales are spurred by the need for most large businesses to back up data in case of natural disasters or computer glitches.
Some companies will spend more on storage than on computing power over the next two years, IDC says.
Dell shipped its own brand of storage hardware known as PowerVault in late June. PowerVault works with NT and Novell Inc.'s NetWare operating software.
PowerVault uses fiber- optic connections designed to send and receive data at high speed. Dell also introduced accompanying software, and has created service and support divisions geared toward storage devices.
The PowerVault line was expanded in December. Dell shipped new tape backup systems and storage products for small businesses. Dell also introduced hardware that aims to improve data transfer speeds between servers and disk drives.
In one way, storage hardware should be an easy sell for Dell, Reinis says. Most server customers also need storage. Customers prefer to shop from one source, he says.
As a PC maker, though, Dell could face challenges getting into the storage market. Selling storage for computers that run NT is new to Dell.
Dell got serious about selling NT servers in '96, company executives say. Dell had $18 million in NT server sales, or 4% of all NT server revenue in the second calendar quarter of '96. Market share leader Compaq had 48%, says San Jose, Calif.-based market researcher Dataquest Inc.
In two years, Dell increased revenue more than 700% to $177 million, controlling 20% of NT server sales. Over the same period, Compaq increased NT server revenue by 69%. Compaq now has a market share of 49%.
Dell began selling NT workstations in the last half of '97. The company experienced a similar success story, becoming the No. 4 NT workstation seller in less than a year. Hewlett-Packard Co. is the NT workstation leader.
The largest potential roadblock for Dell's storage business is Houston-based Compaq. Compaq is the NT storage leader and could make it difficult for Dell to succeed.
''We have a huge aftermarket business,'' said John Rose, general manager of Compaq's enterprise division. ''In addition, we're focused on going off base, selling storage for other people's servers, including Dell's.''
Compaq also has experience making and selling storage-area networks, a type of large business system that can house data from servers that run different operating systems. Rose and others predict the storage network market will be a hotbed in the next few years.
Dell has no plans to enter the market for storage-area networks right away, though. Compaq and other companies are spending hundreds of millions on research and development of storage-area networks.
Dell's storage strategy is likely to serve the company well in the next few years, IDC's McArthur says.
''What's important is that Dell has moved from just the desktop,'' McArthur said. ''When margins started to decline, they moved to servers. As those start to decline, they move to storage.'' |
