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

To: Bharat Kalra who wrote (10884)	8/2/1998 6:06:00 PM
From: Raymond	Read Replies (1) \| Respond to of 13594

<<Note this valuation excludes AOL's other sources of income, namely advertising and sponsorships which is proving to be a great source of revenue and income with limited incremental expenses. $1700/per-customer valuation has to take into account derivative revenue sources already. A subscriber pays only $260 per year for membership.

To: Bharat Kalra who wrote (10884)	8/2/1998 9:00:00 PM
From: Todd Daniels	Respond to of 13594

Cable sub value per subscriber is merely shorthand for multiple of cash flow. The rumored AOL buyout price vs. the T/TCOMA buy was: - 300% greater EBITDA multiple - 400% greater price-to-book value - Tangible assets only 23% those of TCI (yet the rumored price is only 50% less) - 0% of TCI's franchises asset; which beyond balance sheet value is impossible to replicate without buying TCI. TCOMA/T AOL Deal (at $100:Mid range of rumored deal price) Forward EBITDA MULTIPLE (4x latest Q) 16 66 PRICE/BOOK 11 55 TANGIBLE ASSETS (net) $ 7.7b $1.8b Property/Equip $ 6.5b $0.3b FRANCHISE COST ASSETS (net) $14.0b -- Also: The $32 billion price reported by the Financial Times is just 13% less than Worldcom is paying for MCI.