Thought you might be interested in this if you haven't already seen
it.........
----------------------------------------------------------------------
This article was sent to you by someone who found it on SF Gate.
The original article can be found on SFGate.com here:
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2001/02/14/S
P146907.DTL
----------------------------------------------------------------------
February 14, 2001 (SF Chronicle)
Quokka Trying To Stay Afloat
Tommy Cummings


MUCH LIKE the global yachting races that it tracks, Quokka Sports
was sailing smoothly, successfully negotiating the choppy Internet seas.
Then, along came that squall known as the dot-com shakeout. It caused the
outlook to seem less than shipshape for the San Francisco company that has
a stake in the digital presentation of many premier sporting events.
Quokka Sports remains afloat, but it's taking on water big-time. The four-
year-old public company has started bailing -- it downsized 59 percent of
its 369-person staff on Monday -- and has altered its course to focus on
live- event coverage, its strength, and to be a service for clients in
need of multimedia content.
"What we've done is changed strategy to be able to compete effectively in
this marketplace," said Alvaro Saralegui, Quokka president and chief
executive officer.
The focus on live events is in place -- Quokka has launched official sites
for the NCAA men's and women's basketball tournaments and the 2002
Olympics and also plans to apply its unique online presentation to the PGA
and Major League Baseball.
But to offset declining ad revenue, Quokka Sports also announced this week
that it plans to spin off its technology division as a business unit that
would provide clients with multimedia needs.
Although Saralegui declined to name prospective clients, he said ventures
would be similar to Quokka's project with General Motors for last year's
24 Hours of LeMans. GM paid Quokka to use its style -- text, images,
video, metrics, etc. -- to track GM-sponsored cars in the race.
"We know what it's going to cost us to do it; we charge that plus a margin
and after that, it's off to the races, so to speak," Saralegui said.
Maybe. It probably will take a lot of those projects for Quokka to see
some financial light.
In its quarterly earnings announcement last week, Quokka warned that its
own auditors might question the company's viability. Some financial
analysts who follow Quokka have abandoned it, perhaps because its stock
value has sunk to penny status.
Those factors could make the NCAA and the International Olympic Committee
begin to question Quokka's sea legs -- though they haven't publicly.
However, NBC Sports -- which has a financial stake in Quokka -- wondered
what was happening, especially with the layoffs and restructuring report,
Saralegui said.
Quokka has had some "discussions (with NBC)," Saralegui said, "but that's
in the spirit of our relationship we've had all along."
All of this seems a far cry from Quokka's beginnings when it offered deep
coverage of global sailing and mountain climbing. Quokka applied the style
to mainstream sports, including wiring Michael Johnson to track his heart
rate and other vital statistics online during two of Johnson's pre-Olympic
meets.
"They've done some real innovative programming," said Patrick Keane, an
analyst with Jupiter Communications. "They just built a broadband business
before there was a broadband audience."
Quokka's struggles have come at an inopportune time. The NCAA basketball
tournaments are less than a month away, the 2002 Salt Lake City Olympics
are less than a year off and sports -- such as baseball, professional golf
and Euro-style motor sports -- to which Quokka has committed to giving its
best digital presentation are beginning.
Meanwhile, Keane said he's not optimistic that Quokka can weather the
storm.
"Right now, they're tacking," Keane said, using another sailing term.
"Every direction they tack in, there's more blood in the water. I'm just
not convinced that they're going to be able to get through it."
BYTES: ESPN Internet Ventures is offering the NFL $50 million in cash over
five years to remain producer of NFL.com, Bloomberg News reported
yesterday. EIV's offer is more than triple the amount of cash it paid to
secure the NFL's Internet rights under a three-year agreement that expires
in April. . . . The smartest link of the week belongs to ESPN.com, which
notified its users on its opening page of the Anna Kournikova e-mail virus
on Monday. The e-mail promised images of tennis star. Once the attachment
is opened, new messages containing the virus are spawned and sent to
e-mail addresses listed in Microsoft Outlook. The harm is the Anna virus
has the capacity to overload e- mail servers. Considering Kournikova is
the most-searched female athlete online, according to Palo Alto-based
AltaVista, ESPN.com probably saved some servers.
E-mail Tommy Cummings at cummings@sfchronicle.com.
----------------------------------------------------------------------
Copyright 2001 SF Chronicle