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Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: Orlando Stevenson who wrote (8026)	3/26/1999 9:07:00 AM
From: Tradelite	Read Replies (1) \| Respond to of 41369

Here's part of a great news story about AOL, which appeared this morning in the Washington Post: ___________________________________ [excerpt] The eBay announcement is the latest in a string of deals in which AOL profits from its huge audience by charging millions for a presence on its sites. Companies from varied industries, including telecommunications, banking and media, have all paid big for the coveted AOL real estate. Yesterday's arrangement has something beyond that for AOL. In addition to the $75 million, AOL will receive the advertising revenue from all of the special auction sites, which will feature the AOL and eBay names prominently. "The reason we did this was eBay wanted access to AOL's enormous community of users," said Steve Westly, vice president of marketing and business development at eBay. "This is the largest deal in eBay's history." There are now 1.8 million items on the online yard sale, which is open 24 hours a day to any Internet user who wants to unload a used slide projector or buy an antique candy box. There are more than 1,000 categories on eBay, which makes money by charging the seller a fee. The special sites would feed into the main eBay auction site, so that people going in through, say, CompuServe and ICQ would be bidding on the same items. Although rumors had circulated that AOL was considering buying a stake in eBay, this deal does not include an equity investment, AOL officials said. Separately yesterday, eBay filed a registration statement with the Securities and Exchange Commission for a secondary public offering of 6.5 million shares that would raise about $1 billion. EBay's stock price closed at $159.37 1/2 yesterday, up $14. AOL finished the day at $126.50, up $9.37 1/2. To AOL, the most important site created by the deal will likely be the one on AOL's core service. "It will keep people on AOL who might otherwise go onto the Web," said Ulric Weil, an analyst with Friedman, Billings, Ramsey Group Inc. And, said Myer Berlow, AOL's senior vice president for interactive marketing, making people feel at home on the site is the way to keep them. "One of the keys to AOL's stickiness has always been community," he said. With the new eBay sites, he said, "they'll feel that they haven't left the AOL community." For example, Westly explained, if AOL had pop singer Celine Dion on for a chat, it might simultaneously promote all Dion-related items -- such as signed records or her high school yearbook -- listed on eBay. Right now, said Westly, calling up the number on his computer, there are 296 Celine Dion items for sale on eBay. "For any category at all, you'll find relevant items," he said. The alliance, which extends a narrower partnership the two companies have had since late 1998, is aimed at helping eBay's planned expansion into two markets where AOL is already a leader: international online services and regional sites, through AOL's Digital City service. And eBay users will soon be able to download the popular ICQ instant messaging service from a prominent spot on eBay's own site. © Copyright 1999 The Washington Post Company