Thursday, Jul 24, 2008
The once-proud king of the push market sells for a rock-bottom price.
May 13, 1999 | Pointcast -- the once-hot purveyor of "push" -- announced earlier this week that it is going to be acquired. That in itself wasn't news: The company has been on the block for some time. It long ago gave up its once-heady dreams of building a vast empire of Pointcast recipients, who'd get the latest news and information pumped to their desktops using Pointcast software and exposing themselves to Pointcast ads.
But the price tag on the company was a shocker. At its 1997 peak, Pointcast dallied with a $450 million buyout offer from Rupert Murdoch's News Corporation. Plans for an IPO were later shelved, and talks with NBC and various Baby Bell companies all fizzled. Now, reports are that Bill Gross' Idealab is paying either $7 million or $10 million for Pointcast -- valuing the company somewhere south of your typical Silicon Valley startup.
That humbling figure should give pause to at least some of today's high-flying Net firms. Pointcast brought many of its woes on itself, of course, distributing buggy software that promised easy access to information and instead slowed down or crashed people's computers. But its biggest sin was to claim a user base in the millions, when those numbers almost certainly referred to people who had once downloaded Pointcast's software -- whether they were still using it or not. The same tactic is pretty widely used today among Web firms, particularly generic Web community companies. Don't be shocked if they become the Pointcasts of tomorrow.
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