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To: H James Morris who wrote (49613)	4/8/1999 7:59:00 PM
From: Glenn D. Rudolph	Respond to of 164684

Inktomi Extends Momentum for Shopping Engine; Prominent Merchants, New Portal and Destination Sites Sign On to Inktomi's Online Shopping Platform SAN MATEO, Calif.--(BUSINESS WIRE)--April 7, 1999--Inktomi Corp. (Nasdaq:INKT), developer of scalable Internet infrastructure software, today announced a range of merchant and portal partners for its online shopping platform, the Inktomi Shopping Engine. Inktomi has signed agreements extending the Shopping Engine's coverage to include five new portal and destination sites, over 350 merchants, and more than two million products from across the Internet. Inktomi has now forged agreements with 20 leading portal and destination sites to provide the underlying infrastructure for their online shopping offerings. New partners include: FreeServers, FreeYellow.Com, Global DataTel (GDIS), NetGift Registry and Time Inc. New Media. These add to existing partnerships with Infoseek, operator of GO Network, CNET and NBC's Snap, and CNNfn among others. More than 350 leading online merchants have signed on to offer products through the Inktomi Shopping Engine. These premier merchants provide access to more than two million products across 14 categories of products and services. Merchant partners include: 800.com, Art.com, ARTiSANgifts.com, BabyCenter, barnesandnoble.com, bedandbath.com, Beyond.com, Bluefly (BFLY), The Bombay Company, BrainPlay.com, The Company Store, CyberShop (CYSP), Domestications, Egghead.com, Fogdog Sports, Fossil, Gear.com, GreatFood.com, Gump's, Improvements Catalog, International Male, Kitchen and Home, MotherNature.com, Muzic Depot, NECX, Outpost.com, PC Flowers & Gifts, ProFlowers, Reel.com, REI.com, Silhouettes, Skechers, and Sports Superstore Online. Inktomi Shopping Engine The new Shopping Engine extends Inktomi's offerings in the portal services area. These offerings, which include Inktomi's leading Search Engine, leverage the company's scalable core technology to deliver customizable software solutions to portal sites, enabling them to rapidly deploy revenue-generating services that enhance user loyalty and satisfaction. The Inktomi Shopping Engine delivers the first online shopping platform integrated with powerful Web searching technology, and is designed to scale with the growth of users and products on the Internet. The new product allows portals to immediately integrate powerful online commerce capabilities into their sites, while also providing a flexible platform to support customized merchandising and content. Inktomi's Shopping Engine is designed to offer features that provide a compelling online shopping experience including: -0- T -- Product and price comparison shopping for a growing list of merchants and products -- Feature comparisons and research across many popular product categories -- Expert content and recommendations from trusted brands such as Consumers Digest -- Universal Order Processing -- shoppers only have to enter their data once, and all subsequent transactions on any merchant partner site can default to fill in this data -- Tight integration with Inktomi's range of custom portal services T -0- About Inktomi Based in San Mateo, Calif., Inktomi (pronounced INK tuh me), develops and markets scalable software designed for the world's largest Internet infrastructure and media companies. Inktomi's products include the world's largest search engines, online comparison shopping solutions, and carrier-class network cache software. Inktomi works with leading companies including America Online, @Home Network, CNET, GeoCities, Intel, RealNetworks, Sun Microsystems, and Yahoo!. The company has offices in North America, Europe, and Asia. For more information, visit www.inktomi.com. Safe Harbor Statement: The statements in this press release regarding full availability of the Inktomi Shopping Engine, the features to be included in the Inktomi Shopping Engine and the shopping experience available are forward-looking statements that involve risks and uncertainties. Actual results may differ materially from the results discussed herein. The potential risks and uncertainties include risks associated with Inktomi Shopping Engine, need to attract and retain portal customers and merchants, rapid technological change, and substantial competition, all of which are discussed in greater detail in the section entitled "Factors Affecting Operating Results" contained in Inktomi's Report on Form 10-Q for the quarter ended December 31, 1998 filed with the Securities and Exchange Commission on February 12, 1999. Note to Editors: Copyright (c) 1999 INKTOMI CORPORATION. All Rights Reserved. Inktomi, Traffic Server, Scaling the Internet and the tri-colored cube logo are all trademarks of Inktomi Corporation. All other company and product names referenced herein are the trademarks or registered trademarks of their respective holders. CONTACT: Inktomi Corp. Kevin Brown, 650/653-2825 kevin@inktomi.com or Access Communications Wendi Taylor, 415/904-7070 ext. 272 wtaylor@accesspr.com

To: H James Morris who wrote (49613)	4/8/1999 8:41:00 PM
From: Glenn D. Rudolph	Respond to of 164684

By JOELLE TESSLER Dow Jones Newswires Online retailers had a tough act to follow in the first quarter after a blockbuster holiday season drove sales of products over the Internet beyond even the most optimistic projections for the fourth quarter. The fourth quarter of 1998 marked a watershed for the e-commerce business as many shoppers made their first purchases over the Web. That created a ready customer base for online retailers going into the first quarter, but also left them with the challenge of showing sequential revenue growth. Still, while some companies saw declines, analysts are hopeful that leading online retailers such as Amazon.com Inc. and eBay Inc. did manage to increase sales from fourth-quarter levels. The industry should be able to overcome the normal slowdown that hits retailers at this time of year since the Web is growing so quickly and since there are so many "newbies" to online shopping, explained BancBoston Robertson Stephens analyst Lauren Cooks Levitan. "There most certainly is seasonality in electronic commerce, but it is masked by the rapid growth of the industry," said William Blair analyst David Ricci. Still, Mr. Ricci stressed that the rate of sequential growth in the latest quarter will be below that seen in the fourth quarter. Also, even as sales increase, losses are still widening for most e-commerce companies as they continue to invest heavily, particularly in marketing. In addition, some online retailers are seeing their margins squeezed by pricing pressure, which tends to be more pronounced online than off-line. That's because the Web makes comparison shopping relatively easy since competitors are generally just a click away, and automated shopping agents can scour the Internet for the lowest prices. Volpe Brown Whelan analyst Derek Brown noted that pricing pressure is particularly pronounced for resellers of computers and related products -- companies like Onsale Inc., Cyberian Outpost Inc., uBid Inc. and Egghead.com Inc. -- since "it is difficult to see any one company in this space with strong brand momentum." This has led companies to try to lure buyers with low prices. Of particular concern, Mr. Ricci believes, are the new "at-cost" business models being pioneered by companies like Onsale and Buy.com, which are selling products at the same prices they pay manufacturers and distributors for them, plus a small fee in some cases. These companies hope that by offering wholesale prices, they will draw enough traffic to their sites to attract advertising dollars. But this strategy could cut deeply into these companies' margins. What's more, Mr. Ricci noted, it could also have ramifications for companies that don't sell products at cost by increasing the competition they face. Amazon Seen With 'Incredible Growth' Ms. Levitan estimates e-commerce giant Amazon lost 29 cents a share on $260 million in revenue in the first quarter, vs. a 14-cent loss on $252.9 million in revenue in the fourth quarter and a split-adjusted loss of seven cents on $87.4 million in revenue a year ago. Ms. Levitan believes Amazon will most likely beat her top-line number in the first quarter since its customer base has been growing so rapidly. The company said last week that its customer base had already reached eight million, which was well ahead of most analysts' estimates and was up from 6.2 million customers at the end of last year. "They are experiencing incredible growth," she said. Mr. Brown added that Amazon, which started out as an online bookseller, is seeing strong momentum in newer businesses such as music and video sales. The company has also entered the markets for online pharmaceuticals and pet supplies through recent investments in Drugstore.com and Pets.com, and last week launched a person-to-person online-auction service that will compete head-to-head with eBay. Amazon's success as it expands to new markets has hurt competitors. Online music retailer CDnow Inc. merged with rival N2K Inc. after Amazon entered the music business last summer and quickly sold more music on its site than either CDnow or N2K did on its own. Mr. Brown said he believes CDnow and N2K will be better able to compete as a combined entity, but his "gut feeling is that ... they are still struggling against Amazon." The analyst estimates CDnow will report a loss of $1.03 a share on $21 million in revenue in the first quarter. Those numbers include two weeks of results from N2K after the merger closed last month. On a pro forma basis, assuming the merger had occurred before the start of the period, Mr. Brown estimates the merged company lost $1.09 a share on $37.4 million in revenue for the latest quarter. He calculates the combined company would have had pro forma revenue of $38.1 million in the fourth quarter and $16.3 million in the first quarter of last year. And he estimates the combined CDnow added 422,000 customers in the latest quarter, bringing its total to 2 million. EBay Seen as Formidable Foe While CDnow and N2K may be suffering as Amazon has muscled in, eBay presents a formidable rival as Amazon builds up its new person-to-person online auction site. EBay, which serves as an online marketplace where people can buy and sell everything from Beanie Babies to antique furniture, has become one of the most popular destinations on the Web. And its success has made it one of the few online retailers that is actually profitable. Mr. Brown estimates eBay, which makes money by charging sellers listing fees and transaction fees, earned two cents a share on $25.9 million in revenue in the first quarter. The company, which went public in September, earned a split-adjusted two cents a diluted share on $19.5 million in revenue in the fourth quarter. Mr. Brown projects the company had gross merchandise sales -- the value of all the products traded on its site -- of $388 million in the first quarter, up from $306.9 million in the fourth quarter and $104.1 million in 1998's first quarter. Mr. Brown also believes that eBay likely beat his projection that the company added about 825,000 new registered users in the quarter, bringing its total to three million. Because eBay doesn't take possession of any items being sold through its site, the company has low overhead costs and, as a result, gross margins in the 80% to 85% range. In contrast, Ms. Levitan projects Onsale will have gross margins in the 8.5% range in the first quarter, down from 10.7% a year earlier. Onsale also sells goods through online auctions, but generally takes possession of the products themselves. The company sells everything from steaks to vacation time-shares, but focuses on computer equipment. Ms. Levitan projects Onsale lost 28 cents a share on $82 million in revenue in the first quarter, vs. a 16-cent loss on $59 million in revenue in the fourth quarter and an 18-cent operating loss on $40.2 million a year ago. Mr. Ricci estimates uBid, which also operates an online service focused largely on computers and related equipment, lost 35 cents a share before any special compensation charges in the first quarter. The analyst also believes the company will beat his revenue projection of $27 million for the period. UBid, which went public in December, lost 24 cents a share, excluding charges, on $24.1 million in revenue in the fourth quarter. Ms. Levitan estimates Egghead lost 59 cents a share on $36.9 million in revenue for its fiscal fourth quarter, ended March, vs. a loss of 36 cents, including a gain, on $41.9 million in revenue in the prior quarter. Year-ago numbers aren't comparable since Egghead, which made a name for itself as an offline software retailer, closed all of its bricks-and-mortar stores last year to focus entirely on selling over the Internet. Today the company sells mostly computer hardware, software and peripherals, but does offer some products such as jewelry, appliances and consumer electronics. Ms. Levitan is not projecting sequential revenue growth for Egghead since sales were so strong in the third quarter, but believes the company grew its customer base to 870,000 in the fourth quarter, up from 759,000 at the end of the third.