Silicon Investor (SI) -- The First Internet Community

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To: per strandberg who wrote (48243)	6/20/1999 12:31:00 PM
From: BGR	Respond to of 86076

Per, Note that my point is worldwide revenues, not just USA. The internet is the ultimate in global trade - the fact that you are logging in to SI from Sweden underlines this point. So, the growth rates that I mentioned do not apply solely to the USA. They are worldwide. So, growth is not restricted by US growth only, there are huge untapped pockets in the newly industrialized nations as well as in the developing world. Hence, I am optimistic about the 10 year growth. Note, however, that I put the profit margins to a measly 5% because of the reasons that you mentioned. This will help fighting inflation, which was the other piece of the puzzle. Nothing is free, however, and ad and click through revenues are here to stay. Finally a lot of people (not you and me, maybe) pay a decent sum of cash for the SI every month. Good content is valuable whether o/l or r/l. Finally, the infrastructure providers - both h/w and s/w - will do great in all possible scenerios. However, some time in future the Internet PEs should contract to more reasonable values matching their future growth rates (which presently are fabulous) as the market is a forward looking discounting mechanism. And, yes, I do expect a significant contraction in other businesses. I expect several brick and mortar retailers and old school brokerage houses (for example) to go out of business or be acquired by their o/l counterparts. I think that our difference is not on Internet valuation, but rather the perceived future usage of the Internet and the impact it will have on society. There is no way to resolve that other than to wait and see. -BGR.