The Palm Beach Post from West Palm Beach, Florida on September 25, 1999 · Page 28
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The Palm Beach Post from West Palm Beach, Florida · Page 28

West Palm Beach, Florida
Issue Date:
Saturday, September 25, 1999
Page 28
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SATURDAY, SEPTEMBER 25, 1999 The Palm Beach Post PAGE 11B B Analysts say free Web access may become thing of the past By David L Kalish Vie Associated Press ! NEW YORK Even as investors gave the usual hero's welcome to the newest Internet stock, there were strong signs the newcomer's main product free dial-up access to the Internet might not be tjhe wave of the future after all. ! NetZero's shares nearly doubled on Friday, the first day of trading after the free Web service's initial public offering of stock. j Investors were apparently unfazed by news that lylicrosoft, which had considered giving away access to customers of its MSN service, is actually going the other way and raising its fee by $2 a month, to $21.95. Still, Microsoft's decision came amid increasing skepticism by analysts toward the free-Web trend. One problem, they say, is getting users to stick with S, free service, which makes money by parading a Steady stream of advertisements across a user's screen. F5" Tee. com f Your NrtlonwMe Internet Servtct Prvrttftr access, surtree. com fr, Sign-up Now! nationwide internet access Photo taken from Although analysts are skeptical about free Internet services, investors showed enthusiasm in NetZero, boosting the stock from $13 to $29.13. Several early providers of free Web access, including and Tritium Networks, have died trying to make a profit "After doing further work on the 'free access' business model, we are also highly skeptical that it is economically viable," Merrill Lynch analyst Hen- fill! .A 1 mm LA v-m- " i rrsJPliTHfl Mam Photo taken from ry Blodget wrote in a report to investors Friday. Joe Laszlo, an analyst with the Jupiter Communications research firm, agreed. "As people look more closely under the hood, the idea you can provide Internet access solely supported by advertising seems less and less like a winning proposition," he said. Underlying their skepticism is an obvious conclusion: Most people, including Internet users, don't like being bombarded with ads. . n Despite the risks, analysts say companies are likely to continue to experiment with providing free access, particularly to consumers who are heavy users of goods and services. , , Last month, introduced a service that lets customers cut their monthly bills by watching ads. Also in August, AltaVista decided to give away access to customers who click on a win-4 dow of ads and Web links at least once an houf. Those who don't are disconnected. NetZero's public offering was the latest test of enthusiasm for the trend, and investors appeared to embrace it, boosting the company's stock (Nasdaq: NZRO) more than $13 to $29.13. Notably, the big gain came at the end of a week in which technology stocks have suffered punishing losses on Wall Street. U.S. office: Hold down production of F-22 jets Make six, not 10, until the bugs can be worked out, the GAO recommends. By Stephen Pounds . Palm Beach Post Staff Writer The military should produce only six F-22 jets instead of 10 in fiscal 2001 until manufacturing problems are resolved and more testing is done, the federal General Accounting Office said this week. The F-22 is made by Lockheed Martin Corp., but its engines are made by Pratt & Whitney. The project is managed out of Pratt's plant in northwestern Palm Beach County. The GAO's conclusion is not earth-shattering. It is more of the same from an agency that said in April that it is worried about the growing costs of the Air Force's stealth fighter of the future. The GAO advised Congress to drop $65 million of the proposed $277 million in advance spending on 10 of the jets for the military in fiscal year 2001. But the timing is bad. A conference committee has been negotiating this month to resolve differences over the U.S. Defense Department for fiscal year 2000, which begins Friday. One of the biggest hurdles to a compromise is the F-22. The House voted in July to drop $1.8 billion from the $3 billion proposed by the military. The Senate voted for full backing. "It certainly is important evidence, but it's not something that someone going to pull out of their pocket and say, 'See,' " one congressional aide familiar with the committee's negotiations said. Sen. Ted Stevens, R-Alaska, and Rep. Jerry Lewis, R-Calif., have been negotiating to end the budget stalemate over the F-22. "There have been no agreements at this point," the aide said. The one thing everyone can agree on is that they get this completed by the time the fiscal year ends." That gives conferees until Friday to come up with a solution. H m Dow closed at: 10,279.33, down 39.26 NYSE composite: 589.54, down 1.44 Nasdaq: 2740.41, down 9.42 Amex: 771.79, down 5.71 Russell 2000: 417.09, down 3.12 Toronto: 6,763.38, down 48.74 30- year bond: 5.96 percent Dow: Minute by minute 10320, . 103O0j -k A i i i 1 1 i i u 10220 A J V 10200-L-, r , 1 , 1 10 11 12 1 2 3 4 ' v. ) . f Urn? Photo by CHRIS MATULA Sprinkles ice cream parlor owner Andi Williams says the move may be best thing that could have happened to her shop. New owner routs Palm Beach shops Les Evans, who bought two buildings on Royal Poinciana Way, has been criticized for forcing out some tenants. By Paul Owers Palm Beach Post Staff Writer PALM BEACH Les Evans doesn't want you to think of him as the bad guy. The Palm Beach attorney and investor recently paid $1.35 million for two adjacent buildings on Royal Poinciana Way and plans to fix them up. That's certainly a respectable goal. But Evans has angered some longtime Palm Beachers by forcing out three of the buildings' four tenants including Sprinkles ice cream shop, a popular destination for the tourists and townsfolk who stroll the tree-lined street. Retailer Palm Produce Resortwear, which will expand its store, is the lone holdover. "People just need to give us a chance," Evans said Friday. "The street is undergoing some changes, but those are inevitable. Not all change is bad." ( l. . . i j"- v i i( 1 1 ' ""a , MARTIN X j Palm Belch - 1 fr I Lakes Blvd. ff-g"" MLM 'p j"" "V p(wBis BEACH CO. J J Wlr : i I ? ' Palm 3 ) , 1 11 BeachW o s f ' 1 z -i kl -J LakeviewMve jgg ) N j s " f "" Royal Palm Way ... . j HEATHER KONGStaff Artist Evans plans to renovate the inside and outside of the buildings, replacing jalousie windows with French doors and putting up new awnings and signs. He expects to announce new tenants within the next week including an ice cream and dessert shop. Sprinkles could have stayed, albeit in larger space at nearly double the rent. The other two tenants, the Potted Plant and Flower Shop and Wired of Palm Beach, did not fit in with the other businesses along Royal Poinciana Way, Evans said. The owners of those stores could not be reached for comment Friday. Sprinkles closed in August and reopened earlier this month 120 feet west in the former Bollet Building, renamed Bradley Park. The ice cream shop took the 1,100 square feet formerly occupied by Ty-Flies, a retailer that moved to Worth Avenue. Owner Andi Williams is trying to win approval from the town for five tables a luxury she didn't have before in only 500 square feet. "If we get those," Williams said, "this move will be the best thing that ever happened to Sprinkles." Evans, who owns the former Palm Beach Daily News building on South County Road, also has a $1.5 million contract to buy the Tropical Fruit Shop on Royal Poinciana Way and 262 Sunset Ave., a house that has been converted to a commercial building. Please see ROYAL POINCIANA, 17B Floyd's , damage to Florida: if $50 million Florida's windstorm pool will; pay out $15 million, but . won't assess homeowners . to help cover the losses. ' ' By David Sedore Palm Beach Post Staff Writer ' ' " Hurricane Floyd has left Florida's insurers with a $50 million tab, the Insurance Services Office estimated Friday. " The Florida Windstorm Underwriting Association, the state-sponsored pool that covers property in coastal areas, including much of Palm Beach County east of Interstate 95, reported about 2,000 claims totaling about $15 million. ': But the state property insurance pool isn't likely to hit homeowners with a special assessment to cover the losses! said Alan Cook, spokesman for the windstorm pool. By law, the pool may assess all homeowners in the state when it's hit with large losses. The windstorm pool will have more definitive numbers within a week, but Cook said the final number would have to be significantly higher in order to trigger an assessment "We've got $60 million in reserves $15 million or $20 million in claims anq we're good," Cook said. ; A year ago, the windstorm pool a& sessed state policyholders an average of $17 to cover the costs of Hurricane! Georges and Tropical Storm Mitch. ! With Floyd, most of the damage aft fecting the pool occurred in Volusia1 County, with scattered claims else; where, Cook said. j The Florida Insurance Council pro; jected the state's insurers would see between 8,000 and 10,000 claims. "Based on what we're hearing, they're mosdy in Brevard and Volusia counties," -council Vice President Sam Miller said. j Altogether, Floyd is expected to cos( insurers $1.3 billion spread among 503,000 claims. j North Carolina was the hardest hiti with 230,000 claims and $835 million hi damage. New Jersey ranked second; with 39,500 claims and $84 million in damage. Florida's totals ranked fifth among the 16 states hit by the storm. The estimates do not include insured losses from flooding, which is covereq by the National Flood Insurance Pro cram. i Dow: week by week 11400t i i i i i n 10600 10400 10200 6-28 7-12 7-26 8-9 8-23 Breaks Indicate market holidays. 9-6 9-20 AutoNation turns wheel over to ex-Mercedes leader Michael Jackson will direct the ailing auto retailer, which is steering away from its lackluster rental- and used-car businesses By Catherine Wilson The Associated Press MIAMI A veteran of luxury car maker Mercedes-Benz will become chief executive of AutoNation as the nation's biggest auto retailer is losing its rental cars and top executives and trading near a one-year low. Michael Jackson was named Friday to replace Steven Berrard, who resigned after serving as right-hand man to AutoNation Chairman Wayne Huizenga. Five other executives have left the $20 billion company this year. News of the appointment pushed AutoNation (NYSE: AN) shares up 31 cents to $12.06. With 412 franchises, 42 used-car outlets and 270 retail Web sites, AutoNation is in transition. It plans to sell off its lackluster rental-car business, including the Alamo and National chains. -V- ' : : Software maker Daleen prices shares at $10 -$12 The company is shifting its focus from its large used-car stores and rental operations to new-car sales in an effort to Jackson increase profit. "I believe in the AutoNation business model," said Jackson, who was in discussions with Huizenga for two months. "I have admired from a distance how much AutoNation has achieved in such a relatively short period of time." The achievements have come at the expense of share value. AutoNation lost nearly a third of its value this summer and is off nearly three-quarters from a peak in January 1997. Jackson, who began his automotive career 28 years ago as a Mercedes-Benz technician, will be responsible for the development of Automation's business strategy. Jackson, 50, led Mercedes-Benz to record U.S. sales, generating $8 billion in revenue from 311 dealerships. "Mike Jackson is a car guy's car guy," Huizenga said in a statement. "He understands what it takes to be a successful automotive retailer because he's done it himself." By Stephen Pounds Palm Beach Post Staff Writer BOCA RATON Daleen Technologies Inc. will offer 4.1 million shares in an initial public stock offering sometime next week. At $10 to $12 a share, the sale is expected to bring in $41 million to $49 million before expenses. The company had said in documents filed with the U.S. Securities and Exchange Commission that it was seeking $57 million to be used as working capital and for product development and expansion of sales and marketing. Daleen Technologies is a Boca Raton-based software developer that makes customer billing software for other companies. It employs more than 200 people. The company will trade on the Nasdaq Stock Market under the ticker symbol DALN. The stock issue will be managed by Band-Boston Robertson Stephens in Boston. Daleen posted revenue of $5.2 million in 1998, compared to $156,000 in 1997 and $2.5 million in 1996. But it lost $12 million, or $3.78 a share, in 1998 compafejd with losses of almost $8 million, or $3.48 a share, in 1997 and $1.5 million, or 81 cents a share," in 1996. ; Jim Daleen, at one time trie owner of an electrical contracting business, formed Daleen Technologies as a telecommunications consulting business in 1989. The company switched to software development in 1995. The company's main financial backing has come from venture capital partners who have invested $36 million in the company. i I --T

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