Investing (non domain investing)

October 25, 2007

Owen Frager.. Ahead of his Time

Owen Owen writes:

Oh Mr. Schilling... we are getting closer

[http://www.ipodobserver.com/story/33503]
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Piper Jaffray Raises AAPL Target to $250.00

Piper Jaffray's Gene Munster has raised the target price for AAPL to US$250 from $222 based on a detailed iPhone revenue analysis, according to CNBC on Thursday.

While Leopard's launch is expected to add US$240M to Apple's bottom line this quarter, the real story accrding to Gene Munster is a detailed revenue analysis of the iPhone in the outyears.

Mr. Munster is now modelling Apple to sell 3.4 million iPhones in calendar 2007, 12.9 million in 2008, and 45 million by the end of 2009. Based on revenue sharing agreeements with AT, reductions in the price of the phone, [leading to greater sales] and expanded worldwide sales, Mr. Munster set his target at $250.00.

"It's a compelling case, even as Apple shares continue to climb," noted CNBC reporter Jim Goldman.

OF: And still NINE weeks till Christmas <http://frankschilling.typepad.com/my_weblog/2007/05/owen_frager_for.html> !

--
Posted By  s  to  The Frager Factor <
http://fragerfactor.blogspot.com/2007/10/oh-mr-schilling-we-are-getting-closer.html>   at  10/25/2007 09:26:00 PM

October 24, 2007

Microsoft Values Facebook at 15 billion.. Domains Name Valuations in a Bubble

Facebook http://www.bloomberg.com/apps/news?pid=20601087&sid=ah_myY3uN0pE&refer=home

I am consistently dumbstruck that deals like this barely raise an eyebrow, while individual domain names, the foundational elements of the Internet, get compared to tulip manias and bubbles.

It's a strange upside down world we live in.. Domain name monetization has been going on in much the same way since adult webmasters began selling monthly memberships to porn sites in 1995 (3 years after the birth of the modern web browser) ..  Today we have paid search monetization sites for virtually every product and service under the sun. Many are moving away from straight parking toward lead generation, arbitrage, content delivery and pay-per-unique implementations.

But these simple sites which for years have made money in the most benign of ways are 'bubbles' while the publicly listed internet economy, consisting of plates spinning on the ends of pool cues is accepted as foundationally sound and airtight.

All a fellow can do is smile, shrug and keep cashing those checks. It's too tiring and unproductive to pen a counterpoint to each person who don't understand.. or who doesn't want to understand.

Suffice it to say that the Internet has already crashed and burned once ..  domain names did not experience that shock..  If there is a redux of 2000/2001 you can expect domain names to perform in a similar manner as before.

I'm not so sure all of Facebook's 15 Billion will come out the same way.

September 10, 2007

More Fuel For the "Google-Daddy Merger" Fire

Analyst friend writes:

http://seekingalpha.com/article/46373-google-to-acquire-the-world-s-largest-domain-name-registrar

http://www.eweek.com/article2/0,1759,2177278,00.asp

These things might just be idle speculation but I thought it was interesting nonetheless

The thing that caught my eye was the quote from parsons in the first article

July 21, 2007

I Dream of Rupert

I_dream_of_rupertI had the weirdest dream last night..  weird for several reasons. Firstly, I don't usually dream about the domain business (that I can remember) and they certainly don't wake me from my sleep at 4AM.

MurdochIn this dream I was in New York, during some kind of conference and was meeting with Rupert Murdoch about a strategic merger..  A faceless female assistant or key staff-member (who is a mutual acquaintance in said dream) had arranged to bring Rupert by my hotel suite as he made his way to some other meeting. In the office of the suite we talked about the domain name business, how domain name traffic powers part of Google, Yahoo and drives a significant portion of generic-intenet Internet traffic.. Rupe tried to get his head around the concept that many of the companies he had bought and invested in had domain name underpinnings. He was quite clever, savvy and aware of things in my dream.

As much as I wanted to take this meeting to talk shop with today's William Randolph Hearst, Rupert had somehow heard of me (and the domain industry) and he wanted to take the meeting as well! It wasn't a love-fest meeting though. Rupert was the classic 2002 era skeptic.. He wanted to talk about charts and projections through 2012. He seemed hurried, synopsizing the domain industry's highlights and playing devils advocate, talking about fragmented interests and the difficulty of uniting a scatter-shot domain audience around a cohesive core or brand. It didn't seem like I was going to sell Mr. Murdoch on the benefits of merging a large domain network with his media content core.

I had several browser windows open during our discussion and suddenly, as we were in the wrap-up phase of our conversation (Rupert had his coat over his arm and umbrella in hand) it occurred to me to resize two of the open browser windows on my laptop...

DomainmediamashupWhat would happen if every time somebody typed one of our potent domain names they received a single split-screen of targeted paid search advertising, married to a relevant Newscorp media content page?  Type a cooking name and get a relevant food story from today's Newscorp newspaper...  Type Sportscores.com and get ads coupled with the sports section of Foxnews..  Type PersonalLoans.com and get a split-screen with related content from the WSJ..   Rupert's eye's lit up.  I explained how a mash-up of my traffic with his rotating content could turn the 30 million unique visitors we get each month into 60 or 100 million as people came back for more. Then we could ramp up our own Domain Sponsor style third-party syndication business to augment our own proprietary traffic with other domainer's traffic; making Newscorp websites the most visited on the Internet in about 6 months.

Rupert started talking about creating his own ad marketplace and the mechanics of our proposed merger when it suddenly occurred to me that I had already signed a deal to be sold to a less strategic company for hundreds of millions of dollars less than Rupert was offering..  Then I woke up... That's what you call a 'high-class nightmare' folks :)

Playboy_dream_3I jotted down a few notes so I could remember to blog about it then went back to another dream about the playboy mansion.

It was the implementation in the Murdoch dream that still resonated the morning after. The content exists today..  the domain name networks exist today.. They are an invisible traffic source, generating hundreds of millions of unique visits a month globally.  How could Newscorp or another media content house elevate it's Internet presence and exert control over Google by injecting itself as a domain name network owner/sub-syndicator and marrying content to each and every page load?

Lawrence Ng should have a 'frank' conversation with Rupert's people :)

July 19, 2007

A Trillion Dollars Ain't What It Used to Be...

Josh sends note:

""Mergers, mergers everywhere .. Who's next in the web/domain space?
http://www.reportonbusiness.com/servlet/story/RTGAM.20070719.wmanda0719/BNStory/robNews/home

JOHN PARTRIDGE

Globe and Mail Update

July 19, 2007 at 1:23 PM EDT


The worldwide mergers and acquisitions juggernaut is on track to set a new record this year after leaving an all-time high of $2.7-trillion (U.S.) in deals in its wake in the first six months of 2007, according to the New York-based Association for Corporate Growth.

The first-half performance is nearly 70 per cent higher than the comparable period of 2006 and well above the previous first-half record of $1.93-trillion set in 2000, according to a survey released Thursday by the ACG and Thomson DealMakers. At this pace, deal-makers are on track to put a total of more than $4-trillion in M&A on the books by the end of 2007, easily beating last year's record total of $3.6-trillion, ACG president and chief executive officer Daniel Varroney said when reached by telephone in Toronto, where he and other association executives rang the opening bell on the Toronto Stock Exchange. ""

Inflation***FS*** Money is cheap these days Josh.  It will be interesting to see what the river brings for the global economy and this space.  Even with the rash of recent press, very few know about the domain space or have taken it seriously to date. There is soooooo much strategic money out there that has not reared its head yet.  Interesting times to be sure.

July 15, 2007

Tiny bubbles... Not in my Backyard

Danno_2Danno sends link (thanks Danno):

""FYI...

Moneysupermarket.com founder aims to take its customers with him into £940m flotation

http://business.timesonline.co.uk/tol/business/industry_sectors/technology/article2080490.ece

Best,
Dan""

Bubble ***FS***  I worry about the message deals like this send, because the uninitiated read this story and say: "See domains are clearly overvalued and in bubble mode."  The point is, many folks are incapable of understanding the subtleties and intricacies of paid search relating to domains, or the burn-down value proposition domains represent.  They hear about bubbly IPO's of companies with a lot of moving parts (and not a lot of unduplicable substance) and equate them with domain names. Different animals folks.  FWIW. We may live to see the Web 2.0 smoke crash and burn yet,  but domain names will live on for Web 3.0

June 30, 2007

Tech IPO Window Re-Opens

http://news.com.com/Door+open+to+high-tech+IPOs+that+meet+thresholds/2100-1014_3-6194105.html?tag=nefd.top

Open_windowAlso from Josh ..  The IPO window relating to technology begins to re-open.

June 25, 2007

Regional Story, Pundit Turns Bullish on Tech

http://www.jsonline.com/story/index.aspx?id=623973

This regional news story from Wisconsin is poignant because many local investors get stirred to act and invest by sentiment they pick up from local news. Verisign gets a recommendation.

June 12, 2007

Bill Gross - The Bond Guru Marvels at Stamp Prices

Darryl writes:

"Hi Frank,
I thought you would find this interesting about Bill Gross:

http://blogs.ocregister.com/morningeye/archives/2007/06/stamp_sale_by_p_1.html

Wise_wise_manI think Bill Gross is one of the smartest guys in mainstream finance. I've been to the PIMCO offices and always expected it to be bigger..  the majority of the operation takes up half a floor overlooking Fashion Island in Newport Beach.. trading, intelligence..  even Bill's desk is in a great-room of flat desks with monitors (no cubicles). Very very sharp guy IMO ..  I think it's wonderful what he's doing for Doctors Without Borders, but it was funny to hear him remark about the stamp sale:

Quote: ``It's beyond my expectations,'' he said of the day's results. ``It's four times profit. It's better than the stock market.''

4X?!  ...  tee hee ..  If you really want to blow your hair back, you should take domain names for a spin Bill.  :-)

Thanks for the link Darryl.

June 04, 2007

New RBC Analyst Report on Marchex

Jordan_rohanJordan Rohan publishes this report: Download marchex.pdf  which questions the amount of keyword to keyword arbitrage going on at Marchex.

It's no secret that Marchex has one of the best pure-play domain name portfolios in the business and I have previously suggested that the "break-up value" of that portfolio would be many hundreds of millions if they were to peel the names off their deck individually and set conservative "buy it now" sales prices on them.

MarchexThat said, many folks are apparently under the impression that Marchex's revenue comes solely from those terrific domain names. Jordan's report is the first time I have heard a financial analyst intimate that a significant tranche of MCHX revenue might be coming from buying and selling third-party traffic via arbitrage.

A very interesting read, this report is packed with data. It doesn't change the burn-down value of Marchex's name portfolio which is there, and solid IMO.