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Technology Stocks : AUTOHOME, Inc -- Ignore unavailable to you. Want to Upgrade?

To: Erik T who wrote (7702)	4/11/1999 5:09:00 PM
From: Frank A. Coluccio	Respond to of 29970

>yet AOL would charge customers for the right to view their content, unlike Yahoo! < The piece about NetCenter (NSCP) getting restructured by AOL demonstrated that not all portals are equally profitable (or, should I say, have equal potential). Some are a downright drain, like NetCenter was. A shift in viewing habits may make this apparent to Yahoo! too, some day. The flowers have yet to fully blossom. It's too early to tell.

To: Erik T who wrote (7702)	4/11/1999 6:34:00 PM
From: FR1	Read Replies (2) \| Respond to of 29970

I think the battle is over that all-important "first page" the customer sees each day. Bingo! You hit it on the head. Simple, right? We just put a little code in the AOL button so that when they first sign on the customer jumps to AOL homepage. Since the computer is always on and AOL now controls the user's window, there are endless ways for AOL to make money. All browsing of the web could be in done in a AOL window with AOL ads, etc. The other beauty is that AOL gets all the eyeballs, all the ad revenue and ATHM has to handle all the ugly pipeline problems. ATHM doesn't like that picture too much. ATHM spent zillions of dollars researching and creating this backbone and AOL is now trying to steal everything. ATHM dreams about how it will become the AOL of the near future. All the traffic starts at the ATHM homepage and ATHM controls the ads. ATHM feels they can clone a lot of AOL stuff (financial advise, chat rooms, etc). The ad revenue, however, is king. It will make ATHM profitable, allow for lower monthly user cost (thus more users) and ATHM has even talked out loud about how one day ATHM may even offer free access. ATHM foresees one million subscribers by EOY and that is a sort of critical mass for some advertisers. ATHM also knows it can deliver multimedia ads which get more $. If AOL were a cable ISP with 12 million subscribers and very polished interface, they would dry up the ATHM subscriber base (everyone would convert to AOL) and quickly become the tail that wags the ATHM dog. Is there a solution? Maybe. It would be another story if ATHM basically owned much of AOL. So the question really is: How much will AOL pay to be a sort-of cable ISP? Well, for ATHM to give all of their dreams up may be negotiable but they would really want a pound of flesh. Maybe something like: If AOL collects $20/month, then give ATHM $10 plus 40% of all ad revenue. Nobody knows what figures have really been mentioned but ATHM clearly sees it more of a partnership than a pipeline. Very understandable since all their dreams would go up in smoke if AOL became the ISP. Whatever the figure, it is probably too much for AOL to swallow. AOL first wants to see if they can pressure the feds into regulating what they have to pay cable. Any deal AOL can make to become a cable ISP with the feds acting as referee is a giant winner. The feds will never see how down the road how AOL will own the shop. *********** Incidentally, this is not a new battle. Within 24 hours of the time T said it was buying TCI (and thus ATHM), AOL went public and said "I am happy for this. Now maybe we can get some inexpensive broadband access." Then, within 48 hours, ATHM went public and said "If AOL thinks we are just a dumb pipe they had better think again. If AOL is going to use our pipe, we want a piece of the pie."