1. ELC 498 Day 12

2. DAY 12 Agenda Today October 20 –BMG Entertainment - Kristin –Recap of Online Content Providers –Intro to Online retailers October 24 –Staples.com -Anup –Round 2 Grading due October 27 –Petstore.com –Steve October 31 –Sendwine.com – Jeff –Recap of online retailers November 3 – Intro to online brokers –DLJDirect – Donnie November 7 –Carpoint - Kristin

3. General Comments on Midterm The majority of answers required more analysis in the context of the GBF model derived by the author I am always looking for objective analysis (not subjective) Make sure your facts are correct –Be wary of stuff you find with a “google” search –Use good research materials

4. INTERNET BUSINESS MODELS ACCESS PROVIDERS PORTALS CONTENT PROVIDERS –BET.com; CNET; Boston.com; BMG RETAILERS BROKERS MARKET MAKERS NETWORKED UTILITY PROVIDERS APPLICATION SERVICE PROVIDERS

5. Issues Facing Online Content Providers Register users or find other ways to target ads? Become a vertical portal/“infomediary”? (CNET; BET; Boston.com) –Link to third party information sources –Add commerce capabilities –Be “complete, credible, and convenient”; aggregate and integrate Syndicate content to other websites? Exploit multi-media linkages? (e.g., CNET: TV and radio)

6. Issues Facing Online Content Providers Revenue Streams –AD Revenue Targeted raises the premium –Paid Content –Licensing For an incumbent is the Internet a Threat or an opportunity?? –Boston Globe –CNET –BET –BMG

7. GBF for Content Providers? GBF when you believe –Online ad/commerce revenue will surge over next few years –AND, new web user’s brand loyalties are malleable –AND, “winner-take-all” dynamics apply, due to: Network effects Scale economics Intrinsic ability to retain customers

8. GBF for Content Providers? GBF when (con’t) –AND, the lifetime value of a customer’s cash flow exceeds the cost of acquiring the customer –AND, the risks of competitor preemption are high –AND, the company can manage operational growing pains –AND, the capital markets will reward market leaders

9. Get it right First when: Protecting quality and brand is paramount “learning by doing” yields a big payoff Which is it for these providers “GBF” or “GIRF”? –Boston.com –CNET –BET.com –BMG