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Technology Stocks : CMGI What is the latest news on this stock? -- Ignore unavailable to you. Want to Upgrade?

To: Micawber who wrote (12703)	8/25/1999 8:34:00 AM
From: S.C. Barnard	Respond to of 19700

More Harmon on Inets: MONEY TALK As one of the most widely-read Internet analysts on the Web, Steve Harmon looks at the sector with a different twist than other analysts. In this week's Q&A, Steve digs into his e-mail bag to take your questions on Priceline.com, Amazon.com, CMGI, RealNetworks and more! Check out this Money Talk exclusive! Money Talk: What's your outlook for Priceline.com. Although I do not think that this is the time to buy "e-commerce" equities, it seems to me that PCLN is an unusual company with considerable potential because of its unique business model. Harmon: The business model is somewhat unique and in fact I think Priceline.com {PCLN} seeks a patent for it, which I find a little ridiculous. PCLN's revenue growth has been phenomenal and indicative of the "name your price" appeal to mass Internet buyers. However, the company, in my view, has challenges in porting its model into new fields because it's best known for selling airline tickets. In fact, I think a better model for buying may exist in upcoming private companies Accompany.com and Mercata. Both gather wannabe buyers into a big group to get a discount on items. Seems like a great Internet-centric model. Money Talk: What do you think about Amazon.com? Despite it's growth, Amazon cannot seem to even come close to profitability. How will they get their next cash infusion with so much debt on the books now? Harmon: Amazon.com {AMZN} is cashed up, that's why they sold the debt. I see Amazon going after the virgin e-tail and consumer goods space since no other firm tackles that large of an opportunity. More than a year ago, I surveyed the tens of thousands of readers of my analysis about which company they thought of in the Internet specifically for buying different items and many said "Amazon." The interesting part is that Amazon just sold books then. But my survey seemed to say that Internet users thought of Amazon for a much broader buying experience. Coincidence that Amazon started doing just that shortly after? Probably. But now I see Amazon going after the entire e-tail/retail food chain by building warehouses. The thing about warehouses is they can store anything for delivery from books to bread. Amazon invested in HomeGrocer.com and Drugstore.com. {DSCM} Mere coincidence also? Money Talk: I didn't see any comments regarding CMGI in last week's Q&A. CMGI must be considered one of the blue chips of the Internet sector with all its different holding's including Alta Vista & Lycos, no? What is your outlook for this Internet incubator? Harmon: I first became bullish about CMGI {CMGI} back in early 1996 when it was under $2 per share and recall Fortune magazine calling me and asking me about this then "strange" new firm that did venture investing in the Internet but was really a direct marketing firm. My reply then was that CMGI (known as CMG then for "College Marketing Group") was basically a public Internet venture firm that should be valued for its off-balance sheet assets in Internet startups. My reply today is the same and CMGI was one of my top picks for 1999 because I see it as an essential Internet stock to own. Money Talk: Why didn't you mention Excite@Home as one of your top stocks to watch from last week. Where do you see ATHM in the next 6 months to a year? Harmon: The Excite@Home {ATHM} story got a little muddy when rumors surfaced that AT&T may not be as excited about it in the home. Rumor has it that AT&T {T} (which bought TCI, a major ATHM shareholder) wants to rent space on its dialup and cable Internet to the highest bidders, rather than try and build Excite into an AOL {AOL} or Yahoo! {YHOO} killer. It gets back to a thought that drove me to put ATHM on my 1998 hot list: that AOL should acquire @Home. Still not too late and that way AT&T marries the wire to AOL-@Home. Excite then gets spun off to Yahoo or Lycos {LCOS}. In the meantime, I prefer High Speed Access Corp. {HSAC}, a cable Internet firm still in very early risky stages but one partly owned by billionaire Paul Allen. What's attractive is not HSAC alone, but in my thinking Paul and his Wired World (see paulallen.com) philosophy may be coming together. That's what Paul may be doing. Paul mitigates some risk for me in the stocks he owns by being able to infuse cash on a phone call's notice. In fact, owning Paul's positions (or some of them) could perhaps help some folks sleep at night knowing that no matter what the Fed does with interest rates, that Paul has $30 billion to make things happen. Money Talk: What's your outlook on CommTouch ? This equity appears to be the only one that will be integrated into every other Paul Allen investment, providing email, calendaring, and other products and services to end users. Is an investment in CTCH a means of owning a little bit of the entire Paul Allen Wired World? Harmon: Wow! I answered the question above and had no idea this question was here. Ditto CommTouch {CTCH} and relatively undervalued to its mail messaging peers Mail.com {MAIL} or Critical Path {CTPH}. Money Talk: What do you think of convergence of PC/TV/Internet? I have a small investment in a company tied into the Liberty group called ACTV. Do you know of ACTV and if so, what is your long and short-term outlook for the stock? Harmon: ACTV {ACTV}is a highly speculative stock that could benefit if (when) interactive TV becomes more than science fiction. Money Talk: What do you think of Cyberian Outpost? Now here's a little company with strong financials. In my opinion, Cyberian is very undervalued. Do you agree and if so, why? Harmon: E-tail margins are weak and they implode on themselves because of competition. Revenue at Cyberian Outpost {COOL} is strong but the margins make it weak in my opinion. Without true market leadership firms in e-tail and in a highly-competitive market, the sector reminds me of that old U2 song, "Running To Stand Still." Money Talk: I have been a shareholder in RealNetworks for a year and I have seen the stock skyrocket. I would like to know your feelings on the company in the short and long term. Also, why is Broadcom so successful? What is the story behind it's strong growth? Harmon: RealNetworks {RNWK} was also a 1998 favorite. At some juncture, I see RNWK as belonging to an IBM {IBM} or Sun Microsystems {SUNW}. If the latter two ever really want to compete with Microsoft in the platform space, then RealNetworks owns the audio-video platform (for now). RealNetworks has so much under its hood with the server/client/installed base of users, tremendous ability to turn that into a broadcast service and revenue passed Broadcast.com or the new CMGI startup iCast. Real has the potential to do a lot with the network it has by default. That's its real opportunity now, not software. If RealNetworks can make the transition, then I like the stock. If they want to compete against Microsoft forever in the software side, then best of luck to them. I've seen that ending before with CPM (a DOS rival), Apple {AAPL} and Netscape. Broadcom {BRCM} looks like the 'Intel' of broadband chips, both the leader in DSL and cable Internet chips. Just debuted a 10-in-1 chip. To me BRCM stock has much more legs to run if Broadcom can maintain its lead in the broadband wave coming, the next 18 to 36 months will be critical. If you have a question for Steve or a comment about today's Money Talk Q&A, you can e-mail him at harmon@cnbc.com.