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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium -- Ignore unavailable to you. Want to Upgrade?

To: 2MAR$ who wrote (54389)	12/30/1999 3:52:00 PM
From: $Mogul	Read Replies (2) \| Respond to of 108040

AETH- Buying 68 7/8,69 wireless data provider. MLCO and RSSF seem to be buying/accumulating. As will I. PHCM+AETH + $$$,$$$.$$ biz.yahoo.com Good article from Forbes By Anne Granfield With Palm Pilots, two-way pagers and cell phones becoming smarter and more ubiquitous, the future is looking bright for the companies that deliver data and other services to the handheld wireless devices. Technology research firm Dataquest expects that the number of wireless data subscribers in the U.S. will explode from 3 million in 1998 to 36 million in 2003. One application that will surely catch on is wireless stock trading. When it does, Aether Systems, which has established a beachhead in providing applications for wireless stock trading and financial data delivery, will be one of the companies that stands to benefit the most. Aether (nasdaq: AETH), a four-year-old wireless systems provider based in Owings Mills, Md., has managed to link arms with some of the biggest names in online trading. While revenue to date is minuscule, the potential payoff is huge. Darryl Sterling, a wireless Internet services analyst at Yankee Group, says: "Aether has two of the top online brokerage guns in their stable: Charles Schwab and MSDW [Morgan Stanley Dean Witter] Online." "Not all online brokers offer wireless trading now, but its going to be necessary," Sterling adds. "People are going to demand it, and if you don't have it, people will go elsewhere." Michael Mills, Aether's vice president of business development, says the pipeline is full, with deals pending with Bear Stearns (nyse: BSC) and National Discount Brokers' (nyse: NDB) NDB.com. He notes that Charles Schwab (nyse: SCH), which will roll out the service to its customers in early 2000, will be huge. "With 6 million online accounts, out of the whole online market of about 10 million, they are definitely the big fish in this pond," he says. -------------------------------------------------------------------------------- The market clearly sees value in the franchise. The stock shot up from its $16 offering price to $82 and is currently trading around $76, giving the company a market value of nearly $2 billion. -------------------------------------------------------------------------------- In addition to providing systems to allow brokerage customers to trade securities from virtually any handheld device--pager, electronic organizer or smart phone--the company provides real-time news service delivery, stock quotes and alerts, over airtime it buys from various digital networks. Content providers include Reuters, Bridge, NYSE and Nasdaq. The business model is symbiotic. "The brokerage's interest in wireless trading is to get people in front of their service more and to generate more trades by giving people access to their account while they are mobile," says Mills. "They're in this for transaction fees, and we're in this for the monthly subscription fees." The company's subscriber base is still modest, with just more than 4,000 end-users, who pay Aether a monthly fee under one-year contracts. Total revenue for the nine months ended Sept. 30 rose 98% comapred with the same period the previous year to a modest $2.3 million, with a net loss of more than three times that sum ($7.2 million). The company declined to disclose any financial projections, however, a report by BancBoston Robertson Stephens, one of the underwriters of the company's October initial public offering, expects sales to grow to $20 million by year-end 2000 and to $47 million by 2001. Analysts expect the company to turn a small profit by the fourth quarter of 2001. The market clearly sees value in the franchise. The stock shot up from its $16 offering price to $82 and is currently trading around $76, giving the company a market value of nearly $2 billion. At present, two-thirds of the company's stock is held by just five companies, including Palm Pilot vendor 3Com (nasdaq: COMS) (10%) and Reuters (nasdaq: RTRSY) (11%).