Impressive ISDEX Debut For Portal Software

Fortunately, it doesn't appear to be the beginning of another free-fall. Most Internet sectors declined, but not dramatically so. This trend is reflected in the weekly results for internet.com's Internet Stock Index, which showed only nine of its 50 member stocks gaining in the week of trading ended Wednesday, but only a handful of big losers. Overall, the ISDEX fell 5.3 percent.

Open Market, up 12.4 percent - The former leading e-business applications software vendor went from a 52-week high of 65 1/2 on March 9 to 7 7/8 on April 24, a dizzying fall even in the context of the spring stocks meltdown. Though OMKT leads the ISDEX this week, shares actually peaked at 19 on Friday, and have fallen for three straight days since (and are on track to finish lower on Thursday). PaineWebber last week initiated coverage of Open Market with a "buy" rating and a year-end price target range of $30 to $35 per share. The company continues to have problems differentiating itself in the crowded e-commerce software sector. Worse, its announcement Wednesday of a new services package was overshadowed by news of three lawsuits alleging that OMKT defrauded investors with misleading information about product upgrades. (See Open Market Faces Lawsuits)

MP3.com, up 11.9 percent - The market is greeting news of MP3.com's settlement with two music publishers with a sense of relief and enthusiasm for the future of Internet music. That enthusiasm certainly is justified if you're a consumer who likes to download tunes from the Web. However, if you're an investor, the settlements should be viewed as the beginning of the music industry's takeover of Internet music sites, which at best will become serfs in the feudal empire controlled by a handful of music publishers. (See MP3.com Achieves Peace In Its Time) And the ROI for serfs is negligible.