Dear Netscape, Why have the wobbles set in? A couple of months ago you were the toast of Wall Street, thrashing analysts? estimates with third-quarter profits of $7.7m. Your stock responded by shooting up 12 per cent. The future, you claimed, was in providing browsers and other software for businesses to use on intranets.
But then word spread that your sales were slowing, causing a 10 per cent fall in the value of your shares. Within a few weeks your stock lost around a third of its overall value, last month falling yet another 75 cents to $41.50 ? that?s down from nearly $75 last May. Let?s face it, it?s been a roller-coaster from day one. Part of the problem is that, as an ?Internet? stock, most financial whizz kids don?t know what to expect.
Earlier in the year, your objectives were more clear-cut: fight tooth and nail for Navigator against Microsoft Internet Explorer in the battle of the browsers. And try to establish a strong foothold in the server and applications markets for the growing ? and lucrative ? corporate intranet market. But then you had to pull out all the stops to rake in last-minute sales to meet final quarter estimates, thereby stealing business from the coming first quarter in the process.
How did you get yourself into this situation? There are rumours that your sales team thought it had hit its targets by mid-December and so set off early for the festive break ? only to learn that an executive had double counted the figures, prompting a last-minute dash for sales. Further rumours on Wall Street suggested you had lost a major customer.
Your latest flagship, Communicator, looks like a tweaking of your existing products for a more corporate audience. And Corel?s decision to bundle it with its office suite is good news. But to gain serious market share in the groupware arena, you?ll have to train your guns on the software world?s leading veterans. So, do you really have the mettle to displace Lotus or Microsoft? Clearly, the market has yet to make up its mind...
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