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To: Victor Lazlo who wrote (19874)	10/3/1998 11:58:00 PM
From: llamaphlegm	Read Replies (1) \| Respond to of 164684

William: Speaking of AOL, AMZN et al Barrons humor In time, we may even see advertising supplements in Worth where lupine shortsellers model garish $3,000 shoes they purchased by ganging up on Amazon.com, or where self-promoting newsletter writers get dolled up in whatever Christian Dior happens to be pushing this fall. We've long thought that in terms of valuation, online was way off base. Would any sentient businessman pay $24 billion for America Online, whose latest 12-month sales weighed in at $2.6 billion? Would any businessman of sound mind pay nearly $1 billion for MindSpring, with annual revenues of $78 million? But that's what the stock market says they're respectively worth. This month, as it happens, the two companies did a deal. AOL sold an internet provider called Sprynet -- lock, stock and eyeballs (read: facilities, customer support and 180,000 subscribers) -- to MindSpring. We stumbled upon the transaction via Will Lyons, who puts out a newsletter called Short On Value. Will, it should be noted, thinks both stocks are overpriced, but his numbers speak for themselves. MindSpring will pay between $35 million and $45 million for the 180,000 Sprynet subscribers, depending on how many it retains after the sale. That works out to between $194 and $250 a subscriber. By comparison, the stock market is valuing America Online's 14.4 million subscribers at $1,685 each. And it's placing a value of $960 million, or $1,675 each, on MindSpring's 573,000 subscribers (assuming all the 180,000 Sprynet folks move over). Granted, AOL and MindSpring subscribers might rate a premium. But six times the Sprynet subscribers? Come on. interactive.wsj.com lp

To: Victor Lazlo who wrote (19874)	10/4/1998 12:02:00 AM
From: OtherChap	Respond to of 164684

>And OC, if their options should fall into substantially "out of the >money" region, they won't stick around in that case, either. But of course, plenty of high-tech companies have re-priced their options for employees in order to keep them all from jumping ship.. Netscape, Oracle, Apple, the list goes on and on. In my opinion, this is illegal sleaze of the highest order. Do regular shareholders get their stock repriced? Of course not. The SEC has been trying to put a cap on this practice, just like "one time non-recurring charges" that happen to occur every month.. Remember when excite tried to write off their advertising budget as a one time expense? That kind of shenanigans didn't last long. AOL just got slammed recently and couldn't write off its latest aquisition. And it appears that the analysts believe that Amazon won't be able to get away with writing off Junglee and Planetall either.