Q&A: Broadcast.com's Mark Cuban

Summary:The Web broadcaster fields questions on his company's plans -- and the global market for streaming media.

Since going public last July, Broadcast.com has been one of the main beneficiaries of the current investment attitude that confers multibillion dollar capitalizations on companies perceived to be Web leaders. The stock has more than doubled since the start of the year, and even before then, it was trading in the 30s, well above its IPO price of $18 a share.

The company has pushed beyond its beginnings as an purely advertiser supported music and sports broadcaster, to establish itself as a well-known site for business broadcasts, such as conference calls and shareholder meetings. And in an ironic but fitting twist for a company whose IPO was one of the most successful stock debuts in history, Broadcast.com recently bought Net Roadshow, which specializes in Webcasts for companies trying to reach prospective investors just before going public.

Broadcast.com (Nasdaq:BCST) being a Web company, Wall Street isn't asking for real earnings yet. First Call's survey of six analysts predicts a loss of 30 cents a share for this year, including a deficit of 12 cents a share in the current quarter. Profits are expected by the first quarter of 2000.

Earlier this week, Broadcast.com president and chairman Mark Cuban sat on a panel discussion about IPOs. ZD Inter@ctive Investor talked to Cuban just before his address:

ZDII: Speaking of IPOs, one of your competitors, NetRadio, announced recently they want to go public --

Cuban: (laughs) More power to them.

ZDII: -- so how big is the pie for streaming audio?

Cuban: Well, streaming audio can be taken a lot of different ways. If you look at some of the other people in the field, some just focus only on Internet radio. I don't think that's a business.

If I just had to look at Internet radio as a standalone business -- build commerce around that, do whatever we want -- there's no business there. We couldn't support a business. If you look at streaming media and you already start to segment it in an industry so young -- that's crazy.

ZDII: You added to your own offerings recently, with Net Roadshow. How's that acquisition going? Is that integrated yet?

Cuban: It's actually almost there, we closed a week from (Thursday).

And it goes to the heart of your earlier question. 62 percent of our revenues come from business services. We're in a position where we try to control our own destiny.

We want to be able to enable companies to communicate in real-time, and one facet of that is enabling companies to broadcast their roadshows live on the Net.

ZDII: What kind of revenue mix ultimately are you looking at between business services and advertising?

Cuban: Both numbers will grow in absolute terms, but the business services could go higher than 70 percent.

ZDII: You have plans to go international with Broadcast.com Japan.

Cuban: Right, we just did a (joint venture) with Softbank (Note: Softbank is the majority shareholder of Ziff-Davis Inc.) to do Broadcast.com Japan.

ZDII: Long-term, what kind of geographic breakdown are you looking for?

Cuban: Long term, the Net's an international medium, so obviously we want to be across the world. But in terms of stair steps, we'll focus on winning the U.S. and Japan first then pick our battles from there.

ZDII: Do you have any near-term or year long goal out there?

Cuban: We're talking to a lot of people. You'll see us do some things.

ZDII: How's the current quarter going? Are you comfortable with analysts' numbers?

Cuban: We're very comfortable with analysts' numbers.

Topics: Start-Ups

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