Enhanced TV highlights Net landscape

Enhanced TV highlights

OpenTV, Liberate, Wink Communications light up

NEW YORK (CBS.MW) — Internet stocks were mixed Thursday, but shares of enhanced-TV infrastructure stocks extended their gains on news Cisco Systems is buying a broadband video technology company.

The Goldman Sachs Internet Index rose slightly, up 0.6 percent, after adding 4.4 percent Wednesday; that had reversed a two-day losing streak. Coming into this week, the index had advanced 12 percent in the past 10 sessions.

Merrill Lynch’s Internet Holdrs, a basket of the largest Net companies, edged lower but came into the session having reversed a two-day losing streak by gaining 4 percent in Wednesday trading. Recent enthusiasm within the Internet sector, however, had also driven this Net barometer up 13 percent in the past two weeks.

I want my e-TV

Shares of e-TV stocks fired up Thursday after Cisco (CSCO) said it is paying $369 million in shares to buy privately held broadband video technology specialist PixStream.

“There is a race among the biggest broadband providers and technology companies to deliver interactive video because with enhanced TV and broadband you can really combine the emotional power of the TV with the transactional power of the Internet,” said Larry Marcus, a venture capitalist at WaldenVC.

“As a leading infrastructure provider in the networking side, Cisco knows that rich-media content in both audio and video will really drive usage of its networks,” he said. Cisco Systems has been building up its Internet Broadcast Initiative, an initiative to drive the widespread deployment of TV broadcast quality over the Internet. See Net sense.

“And given that the amount of streaming content will be rising ten-fold over the next two years. Companies are jockeying for position to enable it.”

Liberate Technologies (LBRT) ran up $2.44, or 8.6 percent, to $30.75. OpenTV (OPTV) jumped $5.25 to $58.50.

Wink Communications (WINK) gained $1.50 to $16.50, and it’s up 31 percent on the week. Liberty Digital (LDIG), a company with a portfolio of infrastructure and content companies focused on the enhanced TV industry, saw shares gain 5 percent by midday Thursday. Worldgate (WGAT), an enhanced TV software and service provider, rose $1.13 to $19.75

Shares of enhanced TV stocks have been on a tear all week, partly due to news and partly due to the fact that many of these issues are down significantly from all-time highs. Liberate Technologies is up 60 percent this week. Yet even at current levels, shares are still 80 percent below their high-water mark of $148.

On Wednesday, the provider of digital TV infrastructure and BellSouth announced plans to roll out interactive TV services to BellSouth’s satellite customers in the Southeast by the first half of 2001.

Wink Communications is up 31 percent on the week so far. Earlier this week, the company announced that its technology would be used to delivery real-time scoring information for the 2000 U.S. Open Tennis Championships.

A bit of last-minute bidding before the beginning of the September high-tech conferences also helped to power some shares.

“You can tell from the number of conferences that begin right after Labor Day that big firms are expending energy to get people to focus on these stocks,” said James Glickenhaus at Manhattan-based Glickenhaus & Co. “Then it’s a self-fulfilling prophecy.”

September events

Next week, Robertson Stephens will kick off a series of high-tech conferences when it hosts its technology conference in San Francisco. Jupiter Communications will convene a conference on the future of streaming audio and video on Sept. 21 in Manhattan. Dain Rauscher Wessels kicks off its technology conference on Sept. 11 through 14 in Scottsdale, Ariz.

InfoSpace is holding its analyst day in mid-September. Shares of InfoSpace (INSP) rose $2.38, or 6.5 percent, to $39. Analysts hope to get an update on the company’s proposed acquisition of Go2Net (GNET). Go2Net shares added $3.50 to $69.

Engage Technologies (ENGA) rose $1.31, or 10 percent, to $14.19. The online ad-serving firm has been on a recovery path ahead of its quarterly results, to be announced in late September.

According to Perry Boyle, an analyst at Thomas Weisel Partners, Engage’s report will be one of the first indications as to health of the online advertising industry. Boyle has already forecast a sluggish third quarter, but expects to company executives will shed light on the prospects for advertising in the fourth quarter.

Engage’s shares traded as low as $7.50 this summer. Indeed, there are many stocks that have yet to recover fully but are recouping some value.