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 COLUMN
Ask Jeeves' rising revenues fail to boost stock price of Web interaction company ASK JEEVES IS A dot-com company that has a Web site, www.ask.com, which answered 275 million questions last quarter, up 40 percent in three months. Ask Jeeves is also successfully selling software to companies that want to answer questions that are typed into their Web sites. These include other dot-coms, such as AltaVista, and brick-and-mortar companies, including Compaq, DaimlerChrysler, Dell, Drug Emporium, Fidelity, Nike, Office Depot, and Williams-Sonoma.
On the other hand, the stock of Ask Jeeves, like the stocks of so many other public Internet companies, has been dropping. As of last Tuesday, ASKJ had hit a new low, down 90 percent from its 52-week high back in November. Now, I hate to sound so Old-Economy, but the bursting of the Internet stock bubble has been long overdue. You will recall that I predicted last year that the bubble would burst on Monday, Nov. 8, 1999. You may have made some money by ignoring me, but only if you sold before now. If you lost money, you're in good company with George Soros, whose funds lost billions by holding stocks he knew were overpriced. And, steel yourself, the Internet stock bubble has not burst yet -- not for Ask Jeeves, whose stock still sells for 10 times annualized revenue. And the Internet stock bubble has not yet burst for the rest of the dot-coms, especially those whose shares still sell for hundreds of times revenue. Along with its $17.8 million quarterly revenues, Ask Jeeves reported what the company called a "pro forma" net loss of $18.9 million. This isn't bad for a dot-com, but it's not good for public companies under the rules of the Old Economy. Reporting "pro forma" losses doesn't satisfy the grinches at the Federal Accounting Standards Board (FASB). Adding back-paper losses from mergers and stock options, FASB insisted under revised GAAP (Generally Accepted Accounting Practices) that Jeeves report a quarterly net loss of $47 million. These are paper losses, but are a third of cash on hand. Ask Jeeves is a fine company, despite its stock-price fluctuations. It provides "online personal services infrastructure," which is why it adopted Jeeves -- a beloved literary character, a gentleman's gentleman, a valet from the works of P.G. Wodehouse (see www.wodehouse.org). As I'm sure most of you know, Ask Jeeves accepts questions typed in English and then searches the Internet (or content at your site) for pointers to various answers. The company's natural language-understanding software is just good enough so that you sometimes get really funny misunderstandings of your questions; but mostly you get a lot of good answers. Microsoft is a prominent Ask Jeeves customer. And Ask Jeeves is among the very few big Internet sites to rely not on Unix but on Windows for its server operating system. I leave you to speculate on whether Microsoft is a customer because Ask Jeeves uses Windows, or vice versa. Although this will be harder now that its stock is down, Ask Jeeves has been buying other software companies. The company's goal is to gather software for building "Web interaction infrastructure." Most recently, Ask Jeeves announced that it would add VOIP (voice over IP) facilities. Let me close with some comic relief, thanks to Roger McNamee, who is a manager of a well-known technology investment fund. McNamee laments that his investment profits have recently fallen below 50 percent per year. But he says that in the New Economy, his fund's value is no longer measured by investment profits, but by the number of visitors to his Web site. As evidence, McNamee reports that after posting his latest quarterly report to investors, he literally got back hundreds of e-mails saying "I Love You." Technology pundit Bob Metcalfe has answered your questions in these InfoWorld columns for the last 10 years. Say "I Love You" to him by buying his new book of columns, Internet Collapses and Other InfoWorld Punditry, now available at Amazon.com, BarnesandNoble.com, and brick-and-mortar bookstores everywhere.  RELATED SUBJECTS  Business NewsWeb TechnologiesMORE > SPONSORED WHITE PAPERS 
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