Internet Companies Think It’s 1999–and that’s not good
First eBay buys a small Internet telecom business for several billion dollars and Newscorp buys MySpace–a company that most people over 17 years old have never heard of. Now the Los Angeles Times is reporting that the Digital Music Group Inc. has registered to raise as much as $36 million in an initial public offering. Why is this notable?
They are a middle man and don’t own the intellectual property or the customers.They are not profitable.
They are tiny (revenues for the past six months were $223,672 or the cost of one very high-end automobile).
They compete in a very low-margin business.
Their bankers (or “I-Bankers”) have a sales staff that works out of another country.
All I can say is give me a break and it is too early to short these guys? This is the kind of flim-flam let’s go public that ruined the IPO market 5 years ago–I guess memories are that short.
(That said, if these guys are successful in floating this offering then expect to be solicited on the sale of e-IndependentSources securities very soon.)
technorati: mp3 iPod digital music digital music
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October 6th, 2005 at 2:24 pm
Yet our memory of gas guzzlers from the 70s is almost a short. Once everyone started buying on-road tanks, AKA SUV’s, you could almost smell the oil prices going up.
October 6th, 2005 at 9:15 pm
Amen. I particularly have enjoyed seeing full-sized SUVs squeezed into “compact car” spaces during this time period as well.