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Technology Stocks : America On-Line: will it survive ...? -- Ignore unavailable to you. Want to Upgrade?

To: the Druid who wrote (6461)	12/17/1997 11:00:00 AM
From: James F. Hopkins	Read Replies (1) \| Respond to of 13594

HI Druid; can you paste in the url to that deal, Id like to read it. Jim

To: the Druid who wrote (6461)	12/17/1997 3:40:00 PM
From: Harry Larson	Read Replies (1) \| Respond to of 13594

But the BKS deal isn't all additive. It's expansion on renewal of original done Jan 97, in which BKS reportedly has been paying AOL $4-$5 million a year. IOW, the $40m/4 year adds $10m/year. At generous 70% margins and AOL's 40% tax rate, that's $0.03/share. AOL trades on FY99E, which is $1.63. And, of course, these 3-4 year deals severely limit pricing/revenue leverage from subsequent subscriber growth; not to mention that each one commits 'prime' space of which the amount isn't unlimited. Crusing AOL already feels like driving through a dense business highway of strip malls and billboards, complete with people slapping flyers on your windshield while at stop lights (pop-ups).