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Technology Stocks : InfoSpace (INSP): Where GNET went! -- Ignore unavailable to you. Want to Upgrade?

To: KLP who wrote (24985)	2/12/2001 11:18:36 PM
From: sandintoes	Read Replies (1) \| Respond to of 28311

I hope you haven't given Levy any ideas.... Here's an interesting look at portals.. cnbc.com In the wake of Walt Disney Company's (NYSE: DIS) decision at the end of January to shutter its troubled GO.com portal, the question of whether Internet portals can survive at all as a Web business model has been thrown into sharp relief. The demise of GO.com is not the only portal-related story hitting the news wires recently. No. 4 Web portal Lycos recently merged with Terra, Spain's largest Internet service provider, in a bid to attain the global reach of No. 1 portal Yahoo! (Nasdaq: YHOO). In addition, job-cutting has been rampant at other portals, such as NBCi.com, which recently cut 30 percent of its staff, and AltaVista. Journalists, analysts and investors all seem to be asking the same two questions in light of the fallout. First, they want to know what makes portals like Yahoo! so successful while so many others have crash-landed. Second, people are asking how the successful portals must evolve in the future if they are to avoid becoming the Internet equivalent of once-great airlines Pan Am and Eastern? Door to Destination During the Web's early days, the sites that eventually evolved into today's Internet portals began as search engines -- virtual directories that users could leaf through in order to get information on a topic, product or service. However, the people running those sites quickly learned that little money could be made through simple search engines, since advertisers were not willing to pay much to display banner ads on sites that surfers quickly breezed past. In order to encourage surfers to linger, the more savvy sites, notably Yahoo, began adding rudimentary content to their pages including stock quotes, weather reports and Web-based e-mail. Today's portal sites have evolved into one-stop virtual malls, where users can access anything from news to travel information to recorded music clips, and more. Rather than being doors, portals have become full-fledged destinations -- or so their owners hope. Portal Success Factors Andrew Bartels, a senior research analyst with Giga Information Group, told NewsFactor Network that four fundamental factors determine a portal's success: features; presentation of the features; depth of content; and incentives -- particularly monetary. Bartels explained to NewsFactor that Yahoo! has been successful because it hews to the above fundamentals. It offers many features with a large degree of functionality; the simple interface is extremely user-friendly; and the content is so broad and varied that users have little need to go elsewhere. Bartels added that financial incentives, such as the monthly IWon.com million-dollar sweepstakes, have played a huge role in Yahoo's leapfrogging over also-rans like GO.com. Emily Meehan, a senior analyst with the Yankee Group, told NewsFactor that a portal's identity, or lack of one, is also instrumental in determining whether it succeeds or fails. "GO.com should have been Disney.com from the outset," Meehan said, "because everyone knows who Disney is. Instead, GO.com imitated Yahoo! because [Disney executives] didn't think it through." Added Meehan: "Yahoo! was a pioneer, so it became synonymous with the Web in consumers' minds. Disney should have [taken their site] in a completely different direction, taking into account what its brand [has meant] to consumers." Uncertain Future Both Bartels and Meehan agree that one of the most difficult tasks portals face is figuring out a viable way to monetize their content. While advertising remains the primary revenue stream for these sites, the advertising well is drying up and portals will need to establish new sources of revenue. "The Web is about giving consumers information," Meehan said. "What'll be really interesting to watch is what portals will do as consumers become untethered from the PC. As they become more reliant on [wireless phones and PDAs], they're not going to care about where they get this information from." "Consequently, portals such as Yahoo! will start establishing syndication relationships, licensing their content with other sites and even other devices" such as PDAs, Meehan continued. Meehan admitted that she has no idea what the future for portals is going to look like. "But at least we're starting to ask the right questions," she said.