COMMENTARY -- Tuesday ramblings:
A first quarter forecast of 25 to 30 percent year-over-year growth looks pretty good compared to estimates from other tech companies that are Nokia's size or larger. More encouraging, executives during the Q&A portion of the call repeatedly rebuffed analysts' attempts to punch holes in Nokia's projections for a strong second half. Nokia still seems a far healthier bet for wireless than handset rivals Motorola (NYSE: MOT) and especially Ericsson (Nasdaq: ERICY).
As a side note, was I the only one greatly amused by the sound of a cell phone ringing to interrupt this morning's call?
Would that add to the already-considerable questions surrounding the stock? Of course. But providing estimates was even worse, because investors will react to any numbers, even if they will be invalid in a month.
The figures also overshadow the fact that InfoSpace has the right idea. Consumer isn't a growth area, and the company is smart to deal with those segments before they become unprofitable.
Ted Waitt built Gateway into a powerhouse, but unlike Jain, Waitt has never given much thought to products beyond his company's original ventures. Waitt used to boast that one of his company's advantages over rivals such as Dell (Nasdaq: DELL) was the fact that Gateway doesn't do any of its own R&D.
That's not the kind of attitude that will move Gateway into new areas. Waitt can slash costs all he wants, but it won't change the fact that PCs are not a growth industry anymore; he needs to demonstrate that he can sell something else besides boxes cobbled together from other companies' parts.
Don't be surprised to see that "Search and Portal" part of CMGI get smaller each quarter. CMGI realizes the same thing as InfoSpace: there's no money in catering to individuals like you and me. CMGI now paints itself as a company that serves corporations, not consumers: "CMGI is committed to the belief that the Internet creates global opportunities for all commercial enterprises..." reads the first sentence of "The CMGI Vision".
It's a logical shift, but people who want to invest in "Infrastructure and Enabling Technologies," "E-Business and Fulfillment," "Internet professional services," or "Interactive Marketing" might not think of CMGI right away. It would be difficult to argue that any of CMGI's companies are undisputed leaders in their respective fields.
If anything, it reminds of Network Associates' attempt to create all-in-one security and utility suites a couple of years ago. Technology buyers preferred best-of-breed,or at least products that were perceived as such. I suspect technology investors have the same attitude. 22GO>