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 : John, Mike & Tom's Wild World of Stocks -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (1128)	5/26/2000 11:29:00 AM
From: Logain Ablar	Read Replies (1) \| Respond to of 2850

John: A supplier to SFA (and General Instrument, now part of MOT) for the VOD revolution is CCUR (I can't help it I always like the small caps). The CCUR mediahawk product is being tested and rolled out by TimeWarner. I played it last year from 10 to 18 and just reentered earlier this week @ $7.5. They won't start making money till later this year (per company's January cc, I didn't listen to the latest but $7.5 seems like a good price). Of course this is only a good price if the NAZ has bottomed. Tim

To: John Pitera who wrote (1128)	5/26/2000 12:06:00 PM
From: John Pitera	Respond to of 2850

B2B Shakeout article, I commented a bit on this on the Mkt Lab thread. the link will go dead in a while and we want this story safely archived...whatever the outcome. --------- Shakeout looms over B2B market By Rachel Konrad Staff Writer, CNET News.com May 25, 2000, 12:15 p.m. PT The vast majority of business-to-business virtual marketplaces will vanish within two years as failures and consolidation sweep through the once high-flying sector. That's the bleak consensus of e-commerce executives convening in San Francisco this week at the Association of Strategic Alliance Professionals Summit (ASAP), sponsored by Andersen Consulting, Lucent Technologies and Unisys. Government antitrust investigations into online exchanges and viscious talent poaching among business e-commerce companies and their clients are the main culprits in draining enthusiasm from the sector. Since the beginning of the year, Wall Street has smacked B2B stocks harder than almost any other business category. Such disdain is a dramatic reversal from five months ago, when Wall Street touted B2B as the ne plus ultra investment segment and pushed company valuations to unprecedented levels. Most business e-commerce companies have not gone public. For those that have launched initial public offerings, the extreme boom-and-bust cycle in the price of the shares reflects investors' pessimism about the sector: ? Commerce One shares went public last July at a split-adjusted price of $3.50, soared to $165.50 and then sank 75 percent to the current price of $41.25. ? Ariba sold its shares last June at a split-adjusted price of $5.75. They peaked at $183.33 and now trade at $55, a 70 percent decline. ? Viant also went public in June, when it sold shares for a split-adjusted $8. The shares topped out at $63.56 and now trade for $20, a 69 percent decline. ? In its December IPO, FreeMarkets sold shares for $48. They soon surged to $370, but have since plunged by 89 percent to a current price of about $42.50. ? In April 1999, Marimba priced its IPO at $20 a share. The stock peaked at $68.88 and now trades around $12, an 83 percent slide. Virtual marketplaces are typically private sites that act as discount clearinghouses for bulk goods and services in a particular industry. Although competing companies generally cooperate to build the sites, online trade exchanges reduce costs and theoretically heighten competition by making the participants more efficient. The largest exchange announced so far--but still not operational--is Covisint, a 5-month-old automobile industry consortium connecting the world's top automakers and their 30,000 suppliers. The marketplace is expected to have annual transactions valued at more than $300 billion. In February, software database giant Oracle unveiled a venture with retail giant Sears Roebuck and French retailer Carrefour to build an online marketplace serving the retail industry. Sears and Carrefour will initially share a majority stake in GlobalNetXchange, which will link them to their 50,000 suppliers, partners and distributors over the Internet. Despite such grand announcements, investors say their skepticism over business e-commerce trade exchanges is well founded: Roughly 85 percent of all virtual marketplaces that have been announced in the past year--typically with a blast of marketing and public relations bombast--are not yet operational, said Barbara Babcock, president of e-business services for information technology provider Unysis. Although executives in charge of many marketplaces expect to begin operations within 18 to 24 months, Babcock is dubious that most will survive the planning process. The two-year process will likely be a chaotic period of massive employee defections and enormous changes in the B2B business model itself. "Try to imagine a group of competitors staying in touch with each other for two years with no concrete service or product on the market," Babcock said at the three-day ASAP conference, which ends tomorrow. "They can't all stay in business." Skepticism about B2B companies and the marketplaces they create dovetails with broader investor suspicion for Internet companies in general. Of roughly 400 public Internet companies, 12 are expected to report profits this year, according to Walid Mougayar, president of CyberManagement. Online exchanges face additional scrutiny from the U.S. government, which is investigating whether such exchanges are monopolistic. The Federal Trade Commission is looking into Covisint and GlobalNetXchange to determine whether they make it easy for automakers and clothiers and their top suppliers to collude on prices and squeeze smaller suppliers out of business. "If you have all the automobile kings coming together and squishing suppliers, I can't help but think that's going to be viewed as anti-competitive," Babcock said. Business e-commerce companies such as Ariba and Commerce One face additional pressure: Large manufacturers are loath to forfeit the potential revenue stream that their supply chain exchanges generate--especially to companies they perceive as audacious Silicon Valley start-ups and dot-coms. Although companies such as General Motors and Sears have been willing to farm out virtual marketplace implementation to technology companies, some predict the big companies will simply poach tech talent to manage marketplaces of their own. Experts say "old economy" stalwarts are likely to lure top tech executives to in-house B2B divisions with lofty salaries instead of the promise--as yet unfulfilled--of getting rich with risky stock options. More drastic, industrial giants may buy their B2B suppliers outright. The crashing valuations of business e-commerce companies traded on the Nasdaq Stock Market means that large companies can afford to acquire their tech support companies, said Jamie Friedman, B2B commerce analyst for Goldman Sachs. "The empire has struck back," Friedman said. "The company that owns the supply chain technology shouldn't be worth more than the companies themselves. There's something obscene about that...In the old economy, there's something of a victory party going on."