Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : AUTOHOME, Inc -- Ignore unavailable to you. Want to Upgrade?

To: MIKE REDDERT who wrote (14916)	8/25/1999 6:08:00 PM
From: Tom Tallant	Read Replies (1) \| Respond to of 29970

Mary Meeker Date: 8/25/99 @Home is alive and well. Following the company's recent meeting with analysts on July 29th, we remain convinced that the company will meet or exceed its near term financial targets and its long term strategic objectives. Management's confidence in its financial progress and long term strategy direction is robust. We will be hosting a series of meetings with investors in September. Starting with the near term financial targets, we believe that there are four financial metrics. Total subscribers, including international subscribers, should reach 1.1 million at the end of 1999 and over 2.7 million at the end of 2000. Historically, the primary risk embedded in residential subscriber targets has been the installation capacity of the MSO affiliates. AT&T's more aggressive commitment, announced at the analyst meeting, will more than overwhelm any shortfalls of the other MSO's. Also, the risk of slippage at the existing MSO's declines each year as the installation process is perfected. R ATHM 7 08/12 5 We expect that the total revenue from @Home will be $84MM in 1999 and $275MM in 2000. In addition, the @Work rollout continues to accelerate with $43MM and $94MM of expected revenue in 1999 and 2000. Several of the MSO's have begun to discover the commercial market. Advertising revenue is expected to be $225MM and $375MM in 1999 and 2000. Before the Excite/@Home merger, the @Media effort was in its infancy. The combined Excite/@Home has an established base of advertising revenue and faces lower start-up risks. Estimated EPS is ($0.05) in 1999 and $0.20 in 2000. The company should produce positive quarterly EPS in CQ4:99. There has been recent speculation, which we believe is misfounded, that one or more of the MSO partners were in disagreement with the Excite/@Home merger and could seek to reverse the process with a sale of part or all of Excite/@Home. In contrast, we believe that the Excite/@Home merger, as well as all of the other major initiatives of the past year, have been supported by unanimous board of director approval. The strategic position of @Home has always been put ahead of the individual concerns of any partners. --------------------------------------------------------------------------------

To: MIKE REDDERT who wrote (14916)	8/25/1999 6:12:00 PM
From: Tom Tallant	Respond to of 29970

Part 2: R ATHM 9 08/12 7 From another perspective, AT&T controls the largest voting block of @Home shares but cannot unilaterally approve strategic transactions such as mergers and divestitures. Early in 1999 AT&T renegotiated its governance agreements with Comcast and Cox as a result of its failure to reach subscriber benchmarks in its original affiliation agreement with @Home. As a result, AT&T now needs to obtain the approval of either Comcast or Cox (but not both companies simultaneously) to have Excite/@Home engage in strategic transactions, such as mergers and divestitures. The exclusive agreements of @Home affiliation agreements with its cable partners will almost certainly remain intact through their original terms. The earliest agreements end in June of 2002, but several extend to later years. The FCC has been clear that it supports this strategy, and it has been equally clear that it opposes any type of government imposition of open access statutes. Comcast, Cox and AT&T have recently reaffirmed their commitments. It is likely that after the existing agreements expire most MSO's will examine the merits of offering multiple ISP's. However, Excite/@Home will have had a significant first move advantage by the end of the agreements. It would also benefit from being released to pursue multiple affiliates in each market. R ATHM 11 08/12 9 Looking ahead, the next major inflection point in Excite/@Home growth trends should be driven by technology rather than regulations. In 2Q2000 or 3Q2000, the DOCSIS 1.1 cable modem standard should be firmly established, and new personal computers with built-in DOCSIS modems should be available. The ability to purchase PC's with a DOCSIS 1.1 OEM option should lead to greater numbers of self-installations of modem service. The only major installation role for the MSO would be to provide a CATV outlet in the room where the customer intends to place the PC. Thus by late 2000 it should be possible for most operators to have up to 50% of their new data subscriber additions use a self-installation procedure. --------------------------------------------------------------------------------