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Technology Stocks : IATV-ACTV Digital Convergence Software-HyperTV -- Ignore unavailable to you. Want to Upgrade?

To: Champolion who wrote (4214)	5/26/1999 1:45:00 AM
From: Mike Fredericks	Read Replies (2) \| Respond to of 13157

Champ- I'm assuming that this post is your answer to my question about AT&T investing in IATV's competitors. I think everyone here already knew about the AT&T/MSFT connection since it was discussed a few weeks back. Anyway, I'd like to respond and tell you why I do and don't think the AT&T/MSFT connection is a big deal, and hopefully you'll respond. First off, MSFT invested in AT&T, not the other way around. So a company that is a potential competitor to IATV invested in AT&T; AT&T did not invest in any competitors to IATV (except maybe Wink, which I already addressed previously). Originally (msg #4068) you said: This behavior leads me to think that AT&T/Liberty are not yet ready to bet their empire on ACTV's technology. I'm sure you noticed they also invested in a number of ACTV's competitors. I think they will continue that way until the market picks its winner. Then, they will go with that winner. I think that your post here was misleading. You used the plural "a number of competitors" when you were referring to MSFT. Liberty has not invested in any competitors of IATV, nor has AT&T. In post #4074, you follow up with: I believe AT&T/Liberty invested in other companies that plan to provide the same type of services ACTV is advertising. I was not talking about AT&T's investments in RNWK, @Home, TCI, etc. Again, you talk about companies and AT&T/Liberty doing the investing. Misleading in my opinion. So let's look at AT&T/MSFT. First off, Windows CE will only be in a portion (a large portion, but not all) of the digital boxes sold by AT&T/TCI. Nothing is said about digital boxes sold by others. Remember the press release that said that new regulations will allow people to go to a store to buy the cable boxes rather than get them from the cable company? This means that they'll be buying the boxes from the manufacturers, not from AT&T/TCI. Still, assume that Win CE gets a large penetration. IATV software can run on Win CE. So the existence of Win CE doesn't in and of itself eliminate IATV from the running. The major concern is MSFT's mysterious "client and server" software they discuss in one of the press releases. No features for this client or server are mentioned, except that the client will run on top of Win CE on these digital set top boxes. Microsoft and AT&T have a deal where Microsoft's client will be used in live trials in 3 major cities in Mid-2000. This is the most disconcerting part to me, and one of the main reasons I wish IATV would get off their arses and roll the darn product out the door. However, in all likelihood, this is FUD on Microsoft's part. It's the same thing they pull with their other software... they announce a date for delivery that is hopelessly optimistic, then they slip by months (or years) and eventually get the product out the door. Meanwhile purchasers stayed away from the products of competitors because they were waiting for the Microsoft offering. While this may work in the Word Processing market, it's not gonna work here. IATV software is already being included in the set top boxes. It's not software that the end user has to purchase separately. IATV already has the content agreements with Fox Sports (an exclusive agreement through 2003) and has the TVGuide channel, plus there is the Joint Venture with LMG. Lastly, I believe from a technical standpoint that there is nothing prohibiting IATV and MSFT client software from coexisting. If the content from the headend is IATV-enabled, the IATV software will kick in. If it's MSFT-enabled, the MSFT software will kick in. When I see major content distribution companies aligning with Microsoft for interactive TV and Web/TV convergence, I'll worry a little. Right now the only big boy that's done any aligning is LMG, and they're in IATV's corner. Everyone and their brother wants to do interactive entertainment right now. The market is going to be huge. I don't think MSFT has guaranteed themselves a role as a dominant player yet. But even if they do properly position themselves, there is lots of room here... in the broadcast arena there is ABC, NBC, CBS, FOX, WB, UPN and all the cable channels... Microsoft is already allied with NBC (for MSNBC, not necessarily interactive stuff) so do you think ABC and CBS would join MSFT? IATV has already locked up a portion of FOX... see what I'm getting at? This is not "doom and gloom." As an aside- In post #4069 you openly attack Bridge's investment opinion by asking "Is Bridge payed to say nice things about IATV?" In post #4091 you say that you think IATV's patents are worth only $12/share (Why $12? Why not $11.50? Why not $12.25? Why not $10? Why not $13?) and thus you will buy at 12. Why would you buy into a company that is fully valued? Why would you buy the stock at all if you don't have anything positive to say about it? Don't get me wrong - let's assume for a minute that you really are bearish on the stock, and let's also say that you really are short (even though you said you aren't). I firmly believe that you should be able to come on this thread and give your opinions. I just don't understand why someone who posts so much negative about the stock would even consider buying into it? You are worried that LMG and AT&T have invested in IATV's competitors and you think the patents are only worth $12/share. Why buy at $12? Why not wait until $8 or so? Anything above that would be "overpriced" in your book, no? Note that I disagree with you, I think that $12/share is too low a value for the patents. I think that anything from $14-$20 is fair value now, depending solely on whether or not IATV can roll the product out 3Q '99. Last week I was marginned to the hilt and started feeling a little downswing coming on, so I sold 100 of my 250 shares at 17 5/8 paying off most of my margin loan, so now I won't have any margin calls until the stock hits 6 or so. I am not buying any more stock at this time but I'm not selling it either. If they fail to roll out in 3Q, their credibility is shot (see a previous post of mine) and I see the stock dropping under $10 until something actually rolls out. As soon as a definite rollout date is announced, the stock will jump up to over $20 in a matter of a couple of days. There's no predicting when that announcement will come, and if you wait for $12.00 or $12.50 or $13.00, you may not get in. Stock's bounced off of 13 1/2 - 13 5/8 three times now... -Mike