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Technology Stocks : Ampex Corporation (AEXCA) -- Ignore unavailable to you. Want to Upgrade?

To: Fundamentls who wrote (5855)	3/2/1999 4:44:00 AM
From: B. A. Marlow	Read Replies (1) \| Respond to of 17679

Welcome to AXC, dcrice. We've met. I'd like to ask a question: Why is it that VDAT shareholders seem to struggle so hard to justify the intrinsic value of owned content as the magic bullet in Internet multimedia? Let me submit to you that the magic bullet is...money. Look, you're half right: BCST is an "eyeball company," to be sure. Cuban and Wagner have no delusions about winning an Emmy or Oscar and little patience for "auteur" theories. Heck, they've even scorned their own Web site as still pretty primitive. But their focus is single-minded and bulletproof: T-R-A-F-F-I-C! That's why BCST just signed Rush Limbaugh (20mm weekly listeners) and Art Bell (7mm listeners). It's not BCST's content that has "guaranteed long term value." It's the brand franchise that has it. This firm has single-handedly created the multimedia portal and given it a powerful, global thrust. Over 800,000 unique daily visitors now visit BCST's Web site, which some would argue is one of the world's 5 most influential Web sites. (The others: AOL, AMZN, MSFT and YHOO.) Economists call this phenomenon the power of "increasing returns." You raise questions about how BCST will fare in "2-3 years when its exclusive content agreements start to expire, its portal withers, and people begin to realize there's no 'there' there." The answer is simple: BCST will buy the content it needs because it will have... the eyeballs. (And keep in mind that the business-to-business segment is the more powerful half of BCST's business model.) I believe you meander into dangerous waters by concluding that VDAT and AEN/TVW are content companies. On closer inspection, they are not. They're eyeball companies, too. Like BCST, they're arms merchants. Again, the reason is simple: it's eyeballs, not content, that pay the bills and provide returns to shareholders. Content is simply a means, not an end: a fungible commodity, if you will. Let me illustrate by paraphrasing from the current issue of "Steven Brill's Content." In speculating on the value of a merger between CBS News and CNN, Brill suggests that a Monday night rerun on CNN of CBS's "60 Minutes" would generate more revenue for CNN than anything Time Warner could ever put in that time slot. So, to the extent that information transfer is completed, the viewer neither knows nor cares about the content's "chain of custody." And thus, the mission of VDAT must be identical to that of AEN/TVW, which must be identical to the mission of BCST--or, for that matter, DIS or TWX or NBC: to seek eyeballs. Look, this is the AXC thread. I know you're not comfortable with BCST so I'm not going to harp on it for too much longer. I'll leave you with two thoughts, though: 1) VDAT's rise since early December is largely attributable to the explosion of interest in BCST, and 2) on January 21st, you advised a BCST poster "don't expect to see $200 (pre-split) again for a long, long time!" BCST closed today at $95.50 (post split)... On a hopeful note, we'd encourage you to find your way to the merits of AXC's emerging initiatives and become an investor. If we can help, please let us know. Just wouldn't want you to think you'd stumbled onto the set of "Waterworld." BAM