ICAST A THING OF THE PAST?

CMGI, a high profile player on the Internet, also expects to report that revenue for its first quarter ended Oct. 31 was down 3.5% from the $377.2 million of its fourth quarter.

In a broad overview of operations released late Monday, the company forecast that its continuing restructuring would "dramatically accelerate its path to profitability" and substantially reduce its "burn rate," or net cash outflow, over the next nine months.

Headed by an entrepreneur, David Wetherell, who is widely hailed as a technology visionary, CMGI operates a collection of Web companies including the AltaVista search site, and also invests in start-ups via its venture-capital operation, CMGI@Ventures. This structure has subjected the company to a double whammy as the bloom comes off the Internet rose: red ink on the operating side and less ability to finance those losses by selling shares of its start-ups, The Wall Street Journal reports.

Recently, CMGI had said it was looking for a "strategic partner" for iCast, an entertainment site that delivers Web audio and video. Apparently one couldn't be found, and CMGI said it will "exit" the business by the end of its second quarter. A piece of iCast, Signatures Network, will continue operations as part of another CMGI unit, according to published reports. Just last week, two potential buyers—News Corp. and a second, unnamed music-industry concern—were reportedly in talks with iCast's recently revamped music division. The status of those talks—and any others taking place—is unclear at this time, according to Inside.com.

Company officials told analysts Monday (11/13) that they intend to reduce the number of majority-owned operating companies to five to 10 by the end of the 2001 fiscal year. The company currently has 13 such operations.

"As a result of an ongoing internal review process, we have come to the conclusion that it is not optimal for CMGI to continue funding extended timelines to reach market leadership and profitability," Wetherell said. He added that CMGI's projected 2001 revenue increase of 80%-90% "reflects our commitment to dedicate resources to those businesses in which we believe we can best meet our objectives."

CMGI shares fell $1.13, or 7.2%, to $14.50 Monday on the Nasdaq, prior to release of the outlook. The shares are more than 90% off their 52-week high of $163.50 and near a low of $12.88 reached earlier this year.