Jill, this is what I'm looking for. I'd like more detail
as to why Dell, or anybody for that matter, would be unable
to duplicate CMGI's business model.
It seems to me that for a small investment, Dell could
staff several hundred employees, managers, directors and
VP's who are intently focused "full time" on competing in
that space. Though Dell would not be immediately competitive
due to ramp up time and the learning curve, we can be pretty
sure the business is still in it's infancy and will
change dramatically in the next 24 months giving Dell the
opportunity to grow into the ever changing model from the ground up.
Also, what pipeline and inventory is owned by CMGI that can't
be built up by Dell? Last time I checked, CMGI had only $10M
of inventory. They have $1.24B in assets of which $1.06B is
in cash and securities. It looks like the entire business itself
has a mere $180M tied up in property, plant, equipment, inventory
etc. This looks like a securities/investment/consulting firm
with about $675M of stockholders equity... most of which is
cash a securities.
Paying $14B for a business that can seemingly be built
organically for about 2% of that amount seems way beyond the
boundries of sound investing.
So, what I'm looking for is some understanding as to what makes
CMGI unique and so valuable while being built on seemingly so
little?
MEATHEAD
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