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Technology Stocks : AUTOHOME, Inc -- Ignore unavailable to you. Want to Upgrade?

To: Paul Weiss who wrote (1396)	2/19/1998 9:26:00 PM
From: Sauron	Respond to of 29970

Try thinking of AOL as a provider of content like a CNN or MTV. Extra eyeballs perusing AOL's content mean AOL is more attractive to advertisers. AOL already tops CNN and MTV for "viewership" during primetime. @Home doesn't yet represent a sizable advertising market, but to AOL the extra numbers mean something. This is why AOL is worth so much more per subscriber than they had to pay for CSRV.

To: Paul Weiss who wrote (1396)	2/20/1998 7:26:00 AM
From: Roger Bass	Read Replies (2) \| Respond to of 29970

AOL is a reasonable, but not a very good comparison with @Home. Certainly, @Home is providing some content and a gateway out to the internet, like AOL. The analogy is a little closer if you think of AOL before they sold their network (ie the wires and modems) to Worldcom. However, as you see from that transaction, the network was not an essential part of their business as (regular) internet access became increasingly commoditized. @Home also runs a network, but it is the core of their competitive advantage. Not only do they own the access to cable wires into the homes (at least for the next few years), but they are way ahead of everyone else in building a network than can deliver very high bandwidth internet access to large numbers of people in a scalable way. The content businesses may well deliver more revenue over time, but their ownership of the network is the basis of their competitive advantage.