Cover image for Net profit : how to invest and compete in the real world of internet business
Title:
Net profit : how to invest and compete in the real world of internet business
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Publication Information:
San Francisco : Jossey-Bass, 1999
ISBN:
9780787944766

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30000005036599 HD96.96.8.A2 C63 1999 Open Access Book Book
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Summary

Summary

Leading technology expert Peter Cohan shows investors how to navigate the sometimes deceptive market of publicly traded Internet companies. Net Profit breaks down the complexity of the Internet market by answering two basic questions: who makes money on Internet-related businesses, and how do they do it? By contrasting leading companies with those that have done poorly, and analyzing different industry segments for size, growth rate, profitability, and profit drivers, the book shows which industry segments are likely to profit, which are not, and why. Investors will benefit from the analysis of the risks and rewards of placing capital in various Internet stocks.


Author Notes

Peter S. Cohan is a leading expert on technology and business and runs his own consulting practice. He is a commentator on CNBC's "Today's Business" and "The Money Wheel" He lives in Marlborough, Massachusetts.


Reviews 1

Booklist Review

Cohan's title leads one to assume that there might also be something unreal in the world of Internet business. One could even argue that there is something even surreal about the current craze for Internet stocks: companies that have yet to make a profit are valued by the market at 500 times their sales. Cohan's purpose is to help would-be investors sort things out. His intended audience also includes Internet businesses that want to compete better and companies that need to understand Internet technology to improve business or conduct research. Cohan aims to make economic sense of the Web in the same way he illuminated the high-technology industry two years ago in The Technology Leaders. Now he "explores . . . the . . . stock market dynamics of internet companies" and examines nine Internet business segments: network infrastructure, Web consulting, Internet venture capital, Internet security, Web portals, e-commerce, Web content, Internet service providers, and Web commerce tools. Cohan's analysis uncovers the business opportunities most likely to be profitable. --David Rouse


Table of Contents

Prefacep. xi
The Authorp. xix
1 Net Profitp. 1
Would You Like to Buy the Brooklyn Bridge?
Is the Internet a Web of Illusions?
Frameworks for Assessing Internet Businesses
Nine Internet Business Segments
Principles of Net Profit
Overview of the Book
2 Net Infrastructure: The Levi's of the 1990sp. 20
Gold in the Hills
Overview of the Network Infrastructure Market
Profit Drivers in the Central Control Device Product Category
Profit Drivers in the Edge Connector Product Category
Cases: Cisco Systems and Nexabit
Implications
The Net Profit Retriever's Assessment of the Network Infrastructure Segment
3 Web Consulting: It's All About Commitmentp. 42
Overview of the Web Consulting Market
Profit Drivers
Case: Sapient
Implications
The Net Profit Retriever's Assessment of the Web Consulting Segment
4 Internet Venture Capital: Money Dictatesp. 63
Overview of a Cyclical Industry
Profit Drivers
Countervailing Forces
Cases: Kleiner Perkins and Sculley Brothers
Implications
The Net Profit Retriever's Assessment of the Internet Venture Capital Segment
5 Internet Security: Barbarians at the Gatesp. 85
Overview of the Internet Security Market
Sources of Future Profitability
Factors Holding Profits Back
Spotting Future Profits
Cases: CheckPoint Software Technologies and Network Associates
Implications
The Net Profit Retriever's Assessment of the Internet Security Segment
6 Web Portals: Walking Through Virtual Doorsp. 106
What Drives the Current High Valuation of Web Portal Companies?
Search Engines, Portals, and Making Money
Sources of Future Profitability
Forces Against Profitability
Four Ideas for Future Profits
Cases: Yahoo and Excite
Implications
The Net Profit Retriever's Assessment of the Web Portal Segment
7 Electronic Commerce: Profitless Prosperity?p. 132
Overview of the E-Commerce Market
Two Channels: Business-to-Consumer and Business-to-Business
Five Structural Principles
Cases: E-Trade Group and Cisco Connection Online
Implications
The Net Profit Retriever's Assessment of the E-Commerce Segment
8 Web Content: Let's Talk About Usp. 156
Overview of the Web Content Industry
Profitability of Web Content Subsegments
Internet-Only Media Firms
General Technology Media Firms
General Technology Consultants
Cases: CNET and Mecklermedia; CMP Media and International Data Group; and Gartner Group
Implications
The Net Profit Retriever's Assessment of the Web Content Segment
9 Internet Service Providers: Oceans of Red Inkp. 179
Reasons for Current Unprofitability
Reasons for Future Unprofitability
Cases: America Online, MindSpring, and EarthLink
Implications
The Net Profit Retriever's Assessment of the ISP Segment
10 Web Commerce Tools: Virtual Plumbingp. 202
Capitalization and the Microsoft Falcon
Browsers
Search Engines
Web Advertising Management
E-Commerce Enabling Software
Cases: Open Market and Macromedia
Implications
The Net Profit Retriever's Assessment of the Web Commerce Tools Segment
11 What Have We Learned? Lessons for Present and Future Profitsp. 229
Which Segments and Models Are Most Profitable? Why?
Which Segments Are Least Profitable? Why?
Criteria for Screening Internet Business Opportunities
Unmet Societal Needs: The Internet's Potential for Matching
Success in Matching
12 Managers: Can the Web Improve Your Business?p. 247
Web Myths and Realities
Lessons from Experience with the Web
Should Your Company Use the Web?
A Ten-Step Managerial Change Agenda
Case: U.S. Cavalry
Overcoming the Challenges of Implementing the Web
Implications
13 From Lossware to Powerware: Advice for Internet Management and Investmentp. 270
Lossware, Brandware, and Powerware: Rising Up the Net Profit Pyramid
Formulating Web Business Strategy: A Manager's Guide
Six Current Rules for Web Investing
Tips for Private Equity Investment
Screening a Public Equity Investment
Referencesp. 295
Subject Indexp. 301
Company Name Indexp. 309