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

To: TLindt who wrote (907)	8/19/1998 6:30:00 PM
From: Rob S.	Read Replies (1) \| Respond to of 2439

The conference call was very enthusiastic. Gross margins came in at 77% and are expected to grow to 80%-85% in the future. The company is managing to keep costs in check despite the rapid rate of growth and recent acquisitions. They have many things coming together in the next few weeks that will more closely integrate and extend the services of the various sister sites. Some of the key elements include the ability to search Tripod and Anglefire for specific interests and key words and more extensive advertising products and commercial agreements. I won't o into details now because I've got an appointment in a few minutes. I will probably post some more about the plans and results latter. Europe is growing by leaps and bounds - they signed over $14 million in new commercial contracts this qtr. and the momentum is building. They have a "well placed and strong partner" in their 50-50 partnership with Bertelsman. The partnership with Sumitomo in Japan is starting to kick in as well. Lycos is helping to kill Amazon.com's growth prospects, IMO. First, their inovative web site-page building related "associates" programs are adding about 2,000 associates for Barnes and Nobel PER DAY. Lycos gets paid a sign-up fee of $19 per registered associate and an on-going percentage of the associates sell-through from the site. This is LESS THAN the cost of the acquired registered user base of the recent acquisitions (~$12 each) Amazon.com paid about $155 in inflated stock per registered user they acquired in the PlanetAll and Junglee acqs. Second, Lycos sold their share of PlanetAll.com to Amazon.com for over 5X what they had paid for it only 3 months earlier! They retain rights to any proprietary technology or capabilities Lycos might want to use (as if that's anything unique). Lycos's own directory, e-mail, and contact database capabilities duplicate or surpass (Wise-Wire) those of PlanetAll anyway. Third, Lycos is talking with Bertelsman about involvement in their efforts to roll out Bertelsman's commercial site this fall. Bob said that the company would have some things to discuss in the future regarding this. Hmmm . . . 24 million registered users. . . . associates programs growing at a fantastic pace . . . partnership with Bertelsman . . . lower costs of operations . . . . greater leverage . . . on-going efforts with B & N . . . growing faster than Amazon.com . . . and the e-commerce component growing faster still . Some choppy waters are ahead for Amazon and great growth for Lycos & partners. But "Amazon is buying such a great brand name" - Bob said that Tripod, the largest and fastest growing community service on the internet has paid ZERO for branding exposure - something that Amazon is sure will lead to huge profits "somewhere over the rainbow". If Lycos had analysts swooning over it as they do for Amazon.con, the stock would be worth $150 by now! Lycos has $153MM on the balance sheet - that grew by $3MM. They have 460 employees, about 75 of whom are in the sales and marketing dept. The company appeared confident that sales and page hit momentum will continue to outpace all of it's rivals for the next few quarters. Analysts offered several congratulations on great performance. I'll try to post a bit more soon.