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Technology Stocks : Excite [XCIT], an exciting stock to own in 1999! -- Ignore unavailable to you. Want to Upgrade?

To: TLindt who wrote (502)	10/23/1997 10:22:00 PM
From: nshul	Read Replies (1) \| Respond to of 3183

Re: AOL, barriers to entry and the content hubs Back on the SEEK thread, you hit the nail on the head when you said that "Excite in now in competition with AOL". Used to be (when there was no internet as we know it today), AOL, Compuserve and GEnie (remember?) were the three big content providers out there (there were other minor players, too). You picked the one you wanted usually based on the content they provided. I had accounts with all three, AOL for their Mac-centric content, Compuserve for the Microsoft tech support and GEnie for the extensive file downloads. Each was good at something, so they all sort of co-existed. But there were only three of them because of the huge barriers of entry that existed back then. If you wanted to compete with them, you needed to setup your own dial-in network at major expense. So, no one did (though, Prodigy became a fourth player at some point). Then the internet descended on the world. The barriers to delivering "content" dropped dramatically. No longer did you need to setup your own network to sell content, it was already in place. Seeing this AOL+the big guys scrambled to erect another barrier to entry - improve the content to lock in those eyeballs. Meanwhile, back on the net, Yahoo, Excite, Infoseek were busy helping you search the internet. As each appeared on the scene, the value of providing a "search" function slowly commoditized as well. Seeing this, they each scrambled to erect another barrier to entry - improve their content to lock in those eyeballs. Meanwhile, back in Redmond, Microsoft was running the Windows software franchise - a monopoly by some accounts. The internet was no big deal to them, but when Java appeared, whoa- this thing had great potential to commoditize Windows PC applications. Seeing this, they scrambled to erect another barrier to entry - improve the content of windows (integrate internet into windows), lock in those eyeballs. But, Microsoft is thinking several moves ahead. They know that content is king now, but in the future, as content becomes more sophisticated and bandwidth-hungry, the shift will undoubtedly be to delivery mechanism. MS, wanting to control this strategic resource, has invested heavily in WebTV, TCI and other delivery modalities. All the players sensing this trend, have started molding their content into "channels". These will serve as the underpinnings of a future electronic media network, where MSNBC, CNET, AOL, some merger of Excite/Infoseek and others will fight for the hearts, minds and eyeballs of you and me. And it boils down to one thing - getting you to buy something. IMHO.