----------------
'Fessing up
----------------
So, it turns out that great story about Chinese airline chiefs having
to be in the air on January 1, 2000 is a fake. Of course, lots of
folks fell for it, including Reuters and the Financial Times. And,
how many of those sources recanted the story? Too bad...
--------------------
Say that again...
--------------------
"They [Microsoft] record operating system sales by hand on a piece
of paper."
- Richard Schmalensee, on Microsoft's accounting practices.
While I'd bet this isn't true, it's fascinating to see the dogs rejecting
their own dog food...
"Searching will maybe happen twice as fast, but results won't be terribly
different."
- Andy Halliday, VP at Excite, discussing why the deal with @Home is
so valuable.
-----------------
Zero Margins
-----------------
Okay, a special section for all this talk of zero margin companies
brought on by OnSale's atCost program and Buy.com's program of selling
many items at wholesale prices. There have been way too many articles
from journalists who don't understand what's going on, and causing people
to walk around and shake their heads wondering what this world is coming
to. All that's happening is these companies are learning what the
direct mail order catalogs discovered years and years ago: low barriers
to entry leads to increased competition leading to decreased margins (you
know, that perfect competition stuff). End result? Make vendors
pay for preferred placement in catalogs (slotting fees). It's been
happening for years in the catalog business, and now just because a few
websites realize it makes sense, journalists are going crazy, thinking
some bizarre (and ridiculous) new business model has been created.
Obviously, the circumstances are slightly different, but it's not such
a ridiculous idea... Does this mean OnSale and Buy.com will succeed?
Not necessarily, but they're not as crazy as everyone's making them out
to be...
------------------------------------------
Earnings Reports, IPOs and the like
------------------------------------------
N2K pre-released some pretty good numbers for its fourth quarter (full
details next week)... Microsoft destroyed analysts estimates again (you'd
think the analysts would catch on after 27 straight quarters of beating
estimates)... DoubleClick beats earnings estimates, but is still losing
money... SGI beats estimates, but is still losing money... Sun barely beats
estimates, but they're certainly making money... Of course, try matching
IBM's $2.3 billion in quarterly *profit*. Investors, however, didn't
like it one bit (obviously, they need to change their name to ibm.com and
start *losing* money, like any real tech company)... Though, investors
certainly weren’t pleased with Baan's loss of $250 million on $142 million
in revenues (do we hear baan.com?)... Lucent destroys estimates... Excite
and @Home both matched estimates (already in tandem)... The SEC is investigating
Network Associates (that's what you get when your CEO admits in an interview
that you use illegal practices to pump up your earnings in bad quarters)...
Computer Associates beats estimates... Western Digital beats estimates,
but is still in pretty serious trouble... Go2Net is making money... Gateway
beats estimates... Iomega beats estimates, but warns that they're on a
sinking ship (with two execs leaping overboard)... In the IPO market, Allaire
had a nice start, as did nVidia and Covad...
------------------------------------------------
Rumors, Conspiracies etc. of the week...
------------------------------------------------
Not even going to mention Lycos rumors... Apple thinking of buying
Connectix (or maybe Sony will buy them)... Virgin Entertainment Group going
online (expect full hype-fest on this one)... AMD to manufacture Compaq's
DEC Alpha's (this is funny all by itself if you know anything about AMD's
chip manufacturing expertise)... @Home to "buy" AT&T's Worldnet service
(really just AT&T shifting assets around, but it makes sense)... AOL
to make a deal with DirecTV...
----------------------------------------
News you should have read elsewhere
----------------------------------------
Intel numbering chips and building encryption in and all the consequences
and sound bytes from industry folks and civil libertarians, etc... @Home
paying way too much for Excite, just to get their hands on some eyeballs
and (more importantly) their next door neighbor's building (look, property
is expensive out here)...
--------------------------
News you could do without
--------------------------
Is it just me or did sixteen new "online calendaring" products show
up this week? As if WebCal, Visto, and When.com weren't enough, now
there were new entrants like SuperCalendar, AnyDay.com, and Jump.com (located
in, get this, Ithaca, NY). Amazingly enough, Jump (which has the
balls to claim they're the only one's doing this) wasn't working a week
after launch (sorry guys, try again)... Sun, Sony and Phillips to use Jini
and create wonderfully cool and connected home electronics (yes, but will
anyone buy them?)... Either way, Microsoft made a deal with 3Com to develop
products that would compete with the Jini'd devices... Vodafone and Bell
Atlantic try to kiss and makeup following their battle for AirTouch...
It takes HP 23 days to answer the question "What is your corporate headquarters'
address?"... Canada realizes its "digital storage tax" might be dumb, and
agrees to reconsider... Sotheby's to launch online auction (welcome to
the party)... RoadRunner was all excited to announce 180,000 customers
(just one day before @Home's big announcement)... Psychologist claims hackers
are typically socially inept, obsessive compulsives (how much do you want
to bet this description will come up in the next key encryption battle?)...
Travelocity says they received over $9 million in sales the first full
week of January (not bad)... Network Solutions makes a few database changes
and now suddenly they're having all sorts of registering problems (hmmm...)...
Music industry meanies shut down the International Lyrics Server... DLJ
thinking of spinning of DLJdirect (so long as they call it DLJdirect.com
they'll be fine)... Not done yet: Larry Flint's lawyer is taking on Seth
Warshavsky's case to allow a web page about the Pope's U.S. visit adorned
with ads for porn pages... Ion Storm apparently has no sense of humor,
whatsoever (don’t sue me, please)... Amazon to sell home furnishings?...
The Palm IIIx to come out slightly before the Palm V, and way before the
Palm VII, but no one has any clue what features any of them will really
have at release (talk about confusing your customers)... Gateway dumps
(and sues) Web America Networks from providing Internet access for Gateway
purchasers... Prodigy "Classic" not Y2K compliant, and so out it goes (as
if anyone cares)...
------------
Surprises:
------------
Intel invested $30.5 million in PictureTel (can someone explain why?)...
While they're throwing money away, Intel also decides to put $100 million
into Samsung... SBC buys Comcast's wireless subsidiary... AltaVista
agrees to renew their deal with DoubleClick, and lock themselves in for
3 years (considering they have the power position here, I imagine the deal
leaves DoubleClick with much less than their previous deal)... Compaq cut
the price they were offering to pay for Shopper.com (that's right, wait
until *afterwards* to do your due diligence)... DirecTV buys Primestar
(shocked to find out they were still in business)...
-------------------------------
(Mis)Uses of Technology:
-------------------------------
IDT's EZsurf (well, I'll hold out final judgment until I see it)...
AOL to deliver news, e-mail and web searching to Lotus Notes users... NetStudio
letting you design web graphics online (pretty cool, actually)... Enron's
Intelligent Network (is there any business this company isn't planning
on getting in to?)... A comic book about superheroes who get their powers
from the Internet, created by comic legend...
----------
Studies:
----------
With all the hype about e-commerce being such a big success over Christmas,
it turns out that many shoppers hated the experience, according to the
folks at Jupiter... Media Metrix shows AOL at the top of sites visited,
followed Microsoft, Yahoo, and Lycos... A study from Healtheon says doctors
are using the Internet a lot more often (you gotta question that source
- they didn't even hire a research company to pretend it was impartial)...
A study from Killen & Associates predicts that companies who use Internet
billing will save billions of dollars by 2001... Zona Research claims that
e-commerce was the third most popular way of buying products this holiday
season (following brand name stores and discount stores)...
-----------
Overhype
-----------
AOL turning off their thesaurus for its questionable synonyms... The
Windows refund for alternate OS users (Linux is nice, but sometimes you
really wish those kids would shut up)... COPA...
--------------
Predictions:
--------------
Snap's Cyclone will be downgraded fairly quickly...
------------------------
Too much free time:
------------------------
Okay, I realize this might be a niche site for the week, but for anyone
familiar with Carl Steadman I found this particularly amusing: http://rhumba.pair.com/carl/date/
Now, the betting begins: how long until Carl becomes like Rick Wallace?
(Okay, okay, that might make it too obscure for too many folks: http://forbidden.dough.net/~archon/rwallace/)
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