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Technology Stocks : Network Solutions (NSOL) -- Ignore unavailable to you. Want to Upgrade?

To: JPh who wrote (122)	7/31/1998 12:02:00 AM
From: Ian Dyer	Read Replies (2) \| Respond to of 1377

We know the person on the Yahoo board is you Mr Cool(JPh). Anyway, this was also posted on the Yahoo board. It pretty much sums up NSOL and their solid position in the future: 1/ it is my understanding that daily registrations are on the order of 4,000. It seems likely this will increase with the large network of foreign affiliates coming onstream. 2/ Existing base: more than one million. Registrations are for two years. Cost is $70. Renewals cost $70 for two more years. This goes on forever. Income is reported on a subscription basis, giving us that large amount of deferred income to show up in future quarters as pure profit. 3/ Consulting . . . I believe there is some overlap with USWB in the area of intranets. NSOL should be able to leverage their registration client base nicely into big growth in consulting. I was especially impressed with the 50% revenue growth here. How long they can sustain current rates of growth is anyone's guess. The market seems to value the company as if they will not be able to sustain this growth too much longer. I do not buy this argument myself. If anything I expect increasing growth rates as more and more of the world gets online and the revolution continues. I think the process will go on for years and years. But that's why I am long. Splits . . . I would not expect a split until the stock goes above 100 . . . I guess this is how most companies do it anyway. Acquisitions . . . there have been several recently but I for one think this is over. More partners overseas definitely. This is a well-managed oranization focused on a particular niche. In my opinion any potential competition is hopelessly behind. Duplicating the corporate infrastructure would require years of investment with minimal return at first. Maybe someone like Dunn & Bradstreet will get into the market. But it is not as easy as it seems I am sure. The renewal fees are the cash cow element of the deal. Many people think the fees will fall over time and they may, but $35 a year is a reasonable fee to charge to be listed. And who knows, if competition is slow in coming and inept, they may even be able to raise the fee once the U.S. Government is out of the picture. I wouldn't bet on this last possibility though. I have said all along the DNS registration and management is a natural monopoly, not just a monopoly by government fiat. It will take a few more years, but someday we will know if I am correct about this. Between now and there the share price could go anywhere. Until there is a resolution of the political dimension to this I expect the volatility to continue. As to the influence any post here can have on the market action . . . I'm afraid I think that is almost zero. There is much to be gained from analysis of the information we can find, but the effect we have is pretty limited I think. Best wishes to all participants in this forum . . . I am happy to see mostly useful postings and polite opinions . . . none of us here can manipulate the markets, but we can raise ourselves to a higher plain, and that in itself is a great profit.