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Technology Stocks : General Magic -- Ignore unavailable to you. Want to Upgrade?

To: Rick Rappaport who wrote (2246)	6/12/1998 3:37:00 PM
From: Mark Oliver	Read Replies (2) \| Respond to of 10081

Rick, It is my understanding that GMGC has chosen to be a service provider and let as many companies that want, resell their service. Based on that, they plan at this time to have one service center for the whole US. This center will be scaleable for demand. I suppose as demand increases, they will consider other master service centers, but at this time there is no reason to have more than one center as the advantages of costs and control of managing a single center, especially in the beginning, would far out weigh having many centers. This system center could be comparable to Pointcast, or Yahoo, or any other large volume information service provider. Despite the fact that these services handle hundreds of millions of hits per day from places all over the globe, they can still function from a single location. Their location is invisible to the user. As far as their taking only 6 to 8 weeks to set up this server, I imagine the establishment of this kind of high volume server system is already pretty well understood. It will require some fine tuning, but mostly they'll have to make their software work and assure the interfaces to other apps go smoothly. When I first heard of this plan, it seemed like they would be better off to sell systems and let all the providers handle the services, but now I see the value in their business plan. The geographic issues are meaningless today. You can service a customer equally whether they are in Miami, Chicago or San Jose. Whether they use a cell phone, 2 way radio, land line and computer interface. In fact, being a single service, you can serve the traveler in any and all locations. They will probably also offer toll free numbers for access from any location in the world soon. So, why should they want to do that versus letting each carrier have a proprietary system? Well, first of all it is less useful to the customer, GMGC looses control over the direction, which is only started, and they have plans of value added service. Imagine the potentials if Portico becomes the major player in the voice browser market (a totally ground breaking shift in using the net). GMGC will have tremendous influence over what a person finds when they do a search. Getting 2,500 hits on a search for buying a book will be even harder to deal with when you can't see the fields of choice. People will probably gladly go for defined standards like Amazon.com for which GMGC will be paid. Stream lined choices will do everyone a favor by simplifying services. Then, you can also add the agent technology to the service where Portico takes an order and then goes out to solicit bids. Again, this kind of service has so much potential and if GMGC keeps control, it will be a greater tool. Portico will become a ubiqitous standard and it will know you personally no matter what point of contact you use to access it. Again, the agent issue had a great example of a woman finds out on Saturday that she has an emergency meeting in Denver on Monday. She assigns the Portico agent to book a flight, have a rental car waiting and find a room within 15 minutes of the meeting. Portico chooses services based on price bids and predefined personal issues for the user, such as a non smoking room, and a vegetarian meal on the flight. Portico is just too powerful for General Magic to let go of control. I think they're taking the best approach. It may be a bigger risk, but I believe the end if successful is so strong it is astounding. It would be unthinkable to do any less. Some people have questioned the barriers of entry to others like Lucent, IBM or Microsoft. It seems like the brains of Portico are proprietary, patented technologies. The strength and broadness of these patents will tell how likely a copycat system can be built. It is sure that GMGC is the key player in agent technology as well other basic issues of Portico. How they can build upon this and block competition is not clear. In the end, all is not clear. The test is coming. I think we stand a very good chance of reasonable success. It is a very exciting company. Regards, Mark