August 2006 Archives
Many readers know that Jupitermedia once owned Searchenginewatch.com and the companion Search Engine Strategies Trade Shows. We sold these properties to Incisive Media in July 2005 for about $43 million.
One of the key "assets" to owning these properties was Danny Sullivan. Danny needs no introduction and I will not go into his history.
Yesterday Danny announced his intention to leave both properties we sold to Incisive Media. Numerous stories hit the Internet and I have linked to one particularly interesting post.
My thoughts: It is a shame that Danny is leaving the Web site he created in 1996 and the show we created together in 2001. We do not have to feel sorry for Danny as he is a Search God. He is not going into the night without the certain knowledge that whatever he does decide to do will certainly be lucrative for the Sullivan family.
It will be interesting to see if Danny decides to start his own business or simply lands with a one time competitor and an even more stronger contract than what he had at Incisive? If he goes it alone there might be days in which he wishes he was back as a contractor who could clips coupons without the worries of running a business.
I always enjoyed my many meetings and London lunches with Danny and miss the SES trade show world. But now I have other concerns as we continue to build out the most significant digital design content emporium on the Internet.
The coming months will find Danny making news and ending up on his feet with his usual good cheer.
Our micropayment site Stockxpert.com just added a XXL download size of over 15 megapixels. Those able to take advantage of this new option are illustrators and owners of high end cameras such as Canons. The XXL files costs 10 credits and because XL files (previously on the site) are about half in size their price was raised from 4 to 5 credits. These changes should be able to attract more professional photographers and increase sales.
Take a look at Stockxpert.com - it is growing weekly in terms of number of contributors, images added and revenues. Stockxpert.com is only one of many ways that Jupitermedia reaches the photo buying community. Our multi-tiered approach to reaching the image buyer is unique in the industry. And there is more to come as we start to roll out additional variations of new and existing services in coming months. And this will be happening not only with images but with our growing music operations spurred on by the recent acqusition of Royaltyfreemusic.com.
I had mentioned on August 9 that I thought it was a good opportunity to buy our stock. So I did just that. Unfortunately I learned, rather painfully, that there is a rule called the "short swing" rule which means that if an officer of a public company sells stock at a price higher than a subsequent purchase (during a six month period) that that officer must pay the difference back to the company.
So yours truly bought shares last week for approximately $6.50 and because I sold shares in June at approximately $16.00, I had to pay a fine to Jupitermedia of about $10.00 per share!!! So while some out there are buying Jupitermedia these days for $6.50 a share, this blogger just paid about $16.00 per share for a $6.50 share.
Needless to say this has been a painful and frustrating experience with the arcane rules of buying and selling stock as an officer of a public company. And of course I will not be buying more stock for at least three more months at which time I will be beyond the grasp of the short swing profit rule.
I guess the only good that has come out of this distasteful experience is that Jupitermedia's treasury is now somewhat larger than it was last week due to my "contribution." Of course I think the money was spent on a good and solid "cause!"
Many readers know that Jupitermedia has a large role in the production and sale of images. These activities continue, but we also are a large player in providing information to designers through community Web sites and print magazines.
One site in particular worth noting is Graphics.com. Note how we weave information about "graphics doings", chat and discussion, of course a few links to our ecommerce offerings.
Jupitermedia will be announcing several new initiatives in this area in coming weeks.
One of the keys to growing ecommerce for any organization is the utilization of community properties such as Graphics.com. I am surprised about how few ecommerce organizations make use of this terrific form of marketing.
I have noted how our stock price was knocked down last week. One of the problems of being a public company is that longterm strategy can sometimes get lost in quarterly numbers.
Therefore the following story about our strategy by Matthew Schwartz of BtoB magazine comes at an interesting time. What is most interesting about the article is the quote in the last paragraph from an individual at an ad agency about the merits of our strategy.
There is an old saying that goes something like this: "Pioneers are susceptible to taking arrows in the back". I can tell you that over the previous 12 years of running two public Internet companies that I have taken my share of "arrows." So this latest episode is no different. Arrows in the back have never bothered me. In fact this is a great opportunity for the Meckler family to buy a bit of Jupitermedia stock - which I started to do yesterday.
Over the years I have purchased at least 200 publications, Web sites and or trade shows. I have done my share of selling too.
Along the way I have met some incredibly nice people doing these deals all over the world (unfortunately some nasty people as well).
The best deals are ones that work out well for both parties. It is also a plus when the transition period immediately after a completed transaction is smooth and the other party is very helpful.
For example we just completed acquiring Royaltyfreemusic.com. We are starting to integrate this site with our Bbm.net. The erstwhile owner of RFM, Shaun Harris has been a joy to work with during the transition period. I never met Shaun during the negotiation nor at the closing. Everything was done from start to finish on the Internet.
I might never get to meet Shaun, but he certainly has turned out to be a gentleman and honest fellow. There is always the chance that we will find a "skeleton" in the closet on this deal as we get further into ownership. I doubt this will be the case and presume that we will always have good feelings about Shaun.
We had our quarterly conference call with investors dealing with the second quarter financials for Jupitermedia. Based on our stock price (sharply lower)Wall Streeters were not pleased. In the previous four years our stock has been as low as $0.96 and as high as $24. Today we closed at $6.61. This closing price is a ridiculously low valuation which shows how irrational Wall Street can be in evaluating earnings and the overall performance of a public company.
This post is not a defense of our company but merely a comment about the ups and downs of being a CEO of a public company. When the stock price was at $24 I was not sure it was worth that price. But I certainly know that the company is worth much more than $6.61.
It would be odd as a blogger not to say anything about our stock price since I frequently comment about the company. I would like all investors to be happy with our stock price, but I try to run Jupitermedia based on the philosophy that our stock price is secondary and that all that is important is to make investment decisions to grow the company for longterm value. And this is what we will continue to do.
One of our writers at JupiterWeb, Nicholas Carlson, wrote an interesting piece about Flickr. Flickr is amazing for the number of photos and photographers it has attracted. It will be interesting to see if and when Yahoo can monetize the property.
Today we announced our purchase of our fourth royalty free music collection. This collection, Royaltyfreemusic.com has terrific music tracks and it also maintains the number one position on Google when one searches the term "royalty free music."
Presently we are melding together all of our wholly owned tracks on our site Bbm.net. However during the early fall we will relaunch a totally redesigned site under the Royaltyfreemusic.com brand with lots of new and original services never before seen by the royalty free music universe. Later in the fall we will begin an ambitious program to integrate the selling of images and music.
This strategy takes time to assemble and build along with our many image initiatives. In the coming months we hope to start reaping the benefits of these numerous initiatives.
I visited our offices in Germany, France and England this week (Tuesday-Thursday). Many readers know we have acquired several businesses in Europe and have been weaving them together. This is a tough job, but it is working. We now have new and integrated in offices in each of these countries. We have enthusiastic and integrated teams for sales and image production. The fruits of these labors should start to come to the surface during the remainder of the year. I must say how thrilled we are with the calibre of the employees we have in these countries. While these trips are difficult it makes the journey much easier when one encounters such enthusiasm.
I see that during the week that AOL finally put into place the strategy that I suggested last December - that is making most of their ISP service free. What a good move! My wife is an avid AOL user and she made the switch to the free service yesterday. When she called the telephone number at AOL to make the change, she was told she was number 275 in line for service. The whole process took 45 minutes - not too bad for getting AOL for free.