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Technology Stocks : Visual Data (VDAT) -- Ignore unavailable to you. Want to Upgrade?

To: prgraphics who wrote (24)	12/19/1998 5:10:00 AM
From: nord	Read Replies (1) \| Respond to of 405

Food for thought. Vdat and video content strength imo is no built into its market value yet. The money from advertisement and company news will provide a nice revenue stream but the coming availability of broadband to the home will significantly increase content to the net providers. Part of a report on pointcast to allow for comparison to what VDAT is building. The uniqe thing about VDAT is that the information stored can be tailored to a specific market. With the strong background of management in NFL TV it seems as though the company is well positioned for the coming convergence of TV the NET. From Raging Bull's CyberStock Investor Report - Issue 1.21 The real value in Pointcast, however, lies in the over 700 news and information sources with which the company has existing relationships. These partners include CNN, The Wall St. Journal, Associated Press and The New York Times. As the recent success of content aggregator InfoSpace.com's IPO demonstrates, Wall St. is placing a healthy value on companies who can aggregate hundreds of information sources into one convenient package. It is this aggregation of valuable sources that has media companies and telcos interested in Pointcast. After all, having over one million users with impressive demographics is nice,but the company's real value lies in its ability to become a turnkey "online service" for media companies and telcos. THE TELCOS NEED POINTCAST TO HELP BATTLE THE CABLE COMPANIES... A study conducted by research firm Kagan Associates this past April estimated that over 1 million homes will have cable Internet connections by the end of 1998. By contrast, technologies implemented by telephone companies to widen bandwidth, such as xDSL, are likely to be used by only 100,000 homes by year's end. Obviously the telcos are lagging behind in the high-bandwidth battle for customers. They must move quickly to combat the increasing momentum of high speed Internet cable players such as RoadRunner and @home -- backed by TCI/AT&T, Comcast, Cox Cable and others. While telcos, such as BellSouth and other Baby Bells, are moving to roll out high-speed digital subscriber line (DSL) services, they still lack a front-end portal for their connectivity offerings. The cable companies, however, in backing Road Runner and @home, have the ability to offer a content-rich portal to complement high speed access. This is where Pointcast CEO Dorman's telco connections come into the picture. Pointcast has the potential to become a turnkey "high speed portal package" for the telcos. The Baby Bell's would then have a content offering that could compete with the @home Network and RoadRunner. The age old criticism of Pointcast being too "bandwidth intensive" would also, finally, be quieted asDSL technology provides sizzling download speeds of around 1.5 Mbs. This content offering could provide the much needed marketing push for the major roll-out of DSL services by the telcos. Combined investment by the Baby Bells could, in turn, position Pointcast to do for the telcos' what @home has done for the cable companies. POSSIBLE POINTCAST BIDDERS? The most likely suitor for Pointcast would appear to be BellSouth, but USWest, GTE, and Bell Atlantic could also be involved in the proposed deal. With @home's over 200,000 existing customers -- more than double the total number of DSL subscribers in the country -- I would expect a deal between Pointcast and either BellSouth or a consortium of telcos to be announced shortly. Time Warner and News Corp. are also rumored to be in talks with Pointcast, but I see little chance of either of these deals occurring. Murdoch has proven resistant to diving head-first into investing on the Web and I would be surprised if he were to make another bid for Pointcast. A deal with Time Warner seems unlikely since they also hold a significant stake in ServiceCo. -- the joint high speed cable venture with Microsoft, Compaq, MediaOne and Advance/Newhouse called RoadRunner. ..And I don't see a major cable player such as Time Warner making a deal with a group of former telco execs over at Pointcast. While Pointcast isn't likely to receive a $450 million valuation even if this rumored deal occurs, I'm sure David Dorman is loving the new comparisons of Pointcast to @home. After all, @home sports a market cap of over $8 billion. If BellSouth and some of the telcos pull the investment trigger, Dorman could have a very Merry Christmas.