How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 485.49

+1.8%

Nov 26 3:59 PM EST

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To: Sir Francis Drake who wrote (22206)	5/5/1999 8:35:00 PM
From: RTev	Read Replies (1) of 74651

what's your take on MSFT strategy re: MSN? Now that they seem to have made their play w/ AT&T, does it still make sense to spin off an internet stock? I still think an MSN spinoff would be a good idea, for all the reasons you mentioned in the "other hand" and a few more that I mentioned yesterday: Message 9321804 Another factor is employee compensation. In both Silicon Valley and Seattle, Microsoft's internet properties compete for employees with high-flying internet companies and their stock options. Even if the bubble has burst, I suspect that the net companies that are perceived to be successful will get premium stock prices (and high volatility) for a few years to come. An independent MSN would offer an ESOP with the same kind of risks and rewards as comparable companies. I doubt that the T deal will change things all that much for MSN. It will be interesting to see how MSN is involved in it. I figure it's possible that it won't be mentioned at all. AT&T will soon become the diluted, but still controlling owner of Excite when its merger with ATHM is completed. That means a T company will compete head to head with MSN on several fronts. I suspect that will continue, but then again, $5 billion can change a business plan very quickly. We might see some of those odd groupings that the cable industry seems to excel at -- like a Microsoft-managed MSN-leaning RoadRunner on T's UMG properties while T's ATHM and Excite stay on their TCI properties. That's not a prediction -- just one of the odd mixtures that might result from this thing. We might also see pocket-sized versions of various MSN offerings getting more prominence on the vast AT&T Wireless network. However all that works out, though, I still think that an independent MSN company would be better able to handle it.

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