To: Doug Meetmer who wrote (11174 ) 6/30/1999 2:08:00 AM From: Karin Respond to of 19700
I am one who will not open an account with the WIT Cap. Want to keep my investments simple and uncomplicated.-· Compaq will become a preferred Information Technology provider for CMGI's businesses Following the announcement, CMGI's chairman, David Wetherell, shared his strategy of realizing significant synergies the deal offers. Initially, Planet Direct, a network of portals offering location-specific content; I-cast, an Internet-based broadcasting company; and Raging Bull, a financial website, will be some of the primary content contributors to AltaVista's new mega-portal site. On the electronic commerce side, CMGI's Furniture.com, Productopia, Carparts.com, and several other vendors will considerably enhance AltaVista's e-commerce offering. In fact, in the next several quarters, CMGI intends to expand AltaVista's sponsorship business from 2% to 3% of revenue (estimated $170 million) to about 40%. Finally, CMGI's ADSmart, an ad management technology provider, and Engage Technologies, a repository of Internet user profiles, will glue these pieces together by enabling the new portal to better serve individual tastes of AltaVista's visitors. To back this strategy, Compaq and CMGI each pledged $50 million to promote the new portal, which should significantly boost AltaVista's brand name recognition, especially in the U.S. Internationally, AltaVista is the second most popular search engine, thanks to the company's advanced language translation capabilities. 'It is a Home Run for CMGI' The acquisition of AltaVista is a big deal. It puts CMGI on equal footing in the portal space. 'It is a home run for CMGI,' says Ullas Naik of First Albany. 'The company purchases well-trafficked portal at half the value of Lycos,' he adds. Naik believes CMGI will probably take AltaVista public within the next 6 to 9 months. As to how Lycos fits within CMGI's portal strategy, Naik thinks that Lycos and AltaVista can peacefully co-exist in the CMGI portfolio on their own. We believe that AltaVista opens a new chapter for CMGI. Progress towards launching the new site as well as AltaVista's prospective IPO should attract considerable attention from the investment community and push shares of CMGI higher. We reiterate our Buy recommendation of CMGI -- with confidence. Updated June 29, 1999 with CMGI at $111. Recommended on 11/16/98 at $18.48.