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To: Pamela Murray who wrote (10462)	3/1/1999 12:15:00 PM
From: Pamela Murray	Respond to of 12468

OT...Interesting article: Compaq Bulks Up for the Portal War Ahead By GARY ARLEN Contributing Curmudgeon March 1, 1999 With predictable myopia, the cable industry is dwelling on USA Networks' absorption of Lycos. As if that were the only big search-engine/portal deal going on these days! Unquestionably, the Lycos deal -- if consummated -- is immensely significant, largely because of the transaction opportunities that it creates. But dealmaking is running rampant through the online portal world these days, and other dealmakers are looking toward the broadband arena as the playground. The veteran -- albeit scarred -- AltaVista search engine is an excellent example of what's going on. AltaVista was one of the first Web search engines, but it is now positioned largely as a business-oriented tool, long ago eclipsed by Yahoo, Excite and, maybe, Lycos. Many business customers -- and also a vast and loyal cadre of consumers -- insist that AltaVista is the most fair and thorough search engine that they can use. Originally developed by Digital Equipment Corp., AltaVista was part of the package when Compaq acquired DEC. Compaq -- hardly a disinterested player when it comes to the broadband world -- is trying to spin off part of AltaVista; an IPO is due later this year. At the same time, AltaVista is bulking up to fight for its role in the looming portal war. A couple of weeks ago, AltaVista acquired Zip2 Corp., which licenses yellow-pages and content-management software to local newspapers for use in their Web businesses. Compaq paid $200 million in cash for Zip2 just one month after it had paid an almost identical sum to acquire Shopping.com, an online retail center. This has all of the makings of a portal play: Zip2 has about 150 local allies nationwide, including papers owned by its initial media investors such as Knight Ridder, Hearst, Belo and The New York Times Co. The expectation is that these newspapers and other partners will incorporate AltaVista search technology and Shopping.com retail features into their services. For its part, Compaq continues to build its cagey relationships throughout the high-speed access business, assuring a presence through the distribution and end-user route. Compaq's stake in Road Runner could become a wedge to push the AltaVista/Zip2/Shopping.com (and anything else?) portal into the broadband arena. Conversely, Zip2's alliances might become a steppingstone to help Road Runner find additional alliances -- especially in markets that would otherwise be good pickings for the independent high-speed-access providers. Compaq also has relationships with regional Bell operating companies, in connection with their digital subscriber line services, and with Hughes' DirecPC. Telco deals for AltaVista/Zip2 would be dicey because of the phone companies' own yellow-pages initiatives. On the other hand, none of the Bell online yellow-pages/directory ventures has amounted to anything, so maybe the Zip2 portal might be of help. Talk about co-opetition. Moreover, Compaq's hardware "triple-play" agenda (as it dubs the cable/telco/satellite high-speed-access capabilities) adds importance to the computer-maker's growing content presence. It also underscores the growing expectations for broad portals as the key to interactive transactions. Compaq's advantage in all of this may come from the direct Internet-connection button that is showing up on the keyboards of its best-selling desktop and laptop "Presario" computers. It enables instant access to a central site, such as a multipurpose portal. That has been the one-button dream of interactive visionaries for years. In Compaq's version, the button drives millions of users to a Compaq-controlled portal. By some measures, the keyboard button is already accounting for 3 percent to 5 percent of accesses. That could give Compaq even greater leverage with its carrier partners and with portal advertisers. On other horizons, Compaq reinforced its Internet commitment during the past month, especially in the e-commerce sector. The company unveiled "next-generation" network-consulting and integration services for Internet-access and network providers, as well as individual business customers. Compaq also plans to offer videoconferencing, voice-over-IP networks and unified messaging servers as part of its service-bureau approach to the Internet. Some of those are areas where the company could find itself face-to-face with its business clients or system-integrator customers. That's the sign of a serious player. The portal wars are under way, as other recent alliances have shown. Media ventures -- notably Disney's "Go" portal (encompassing Infoseek) and NBC's Snap, not to mention the AOL-TV initiative -- are reminders that the USA/Lycos deal, while impressive, faces savvy and well-positioned competitors. And don't forget Yahoo!

To: Pamela Murray who wrote (10462)	3/1/1999 1:42:00 PM
From: TheSlowLane	Respond to of 12468

Yeah. Almost as much fun as having Jim Fink appropriate your name and start spraying stupidity all over the Internet. I highly recommend it...not! I am still sure that someday we will all be gruntled shareholders (if we can hold out that long), but it continues to be more of an amusement park thrill ride than I'd hoped. I've already gotten my money's worth (of adrenaline thrills, not returns) - I wish this ride would smooth out a little! Lehman was the brokerage that issued recs on those three, I believe. When I was in Tucson this weekend, I saw a guy in the hotel lobby with a WinStar t-shirt on, but didn't get the chance to talk to him. I think what the market is waiting for is not the 4Q results, but for Gabor to just come out with a downright bearish comment instead of these sort of half-committed "doesn't look good" comments before we can move up again. At least, that's the way it's worked in the past!