For safety and privacy reasons, Simon did not intend to broadcast the girls' lives indefinitely. A week after the London villa girls' live stream began, Eaglet Portal announced on March 8th that the live broadcast would end on March 31st, lasting a total of one month.
Initially, Simon planned to broadcast for only two weeks.
Considering the phenomenal impact of this video live stream on America Online, Eaglet, and the entire computer and internet hardware and software industry, he extended the live broadcast to one month. By then, the public's interest in the girls would have cooled down, and Eaglet would have completed detailed testing and data collection on live streaming technology.
At the end of February and the beginning of March, amid the turmoil caused by the London girls, many companies within the Westeros system successively released a series of financial reports, either annual reports for 1993 or quarterly reports for the last quarter of 1993.
Daniels Entertainment Group, Cisco, America Online, and the three giants of the Eaglet internet industry, all of which were preparing for their IPOs, were undoubtedly the most closely watched companies within the Westeros system. Their financial report cycles happened to be calculated based on the calendar year.
Cisco was the first to release its financial report.
On February 25th, Cisco published its 1993 annual financial report through the Eaglet portal.
With the rapid growth of the internet industry globally, Cisco also completed extensive global deployment of its products in 1993.
Even though Cisco's market share in global routers and switches dropped from over 95% three years ago when it first went public to around 75% in 1993 due to avoiding antitrust accusations and the impact of overseas national protection policies, this new tech company, which had rapidly exploded with the rise of the World Wide Web, still achieved a 135% revenue growth in 1993, with annual revenue increasing from $2.63 billion in 1992 to $6.19 billion in 1993.
Due to considerations for technical R&D and market expansion, Cisco's net profit margins in 1991 and 1992 were kept below 10%. With the completion of its global market layout, Cisco's net profit margin in 1993 increased to over 10%, reaching 12.6%, and it achieved a net profit of $779 million for the year.
Compared to the net profit of $252 million in 1992, the net profit for 1993 increased by 207%.
In fact, a net profit margin of 12.6% was still significantly lower than Cisco's overall product cost. Both internal and external stakeholders of Cisco were aware that if the company aimed to maximize profits, it could easily achieve a net profit margin of over 20%. However, neither Simon, the Cisco management, nor the majority of external shareholders lacked long-term vision, understanding that Cisco needed to focus on expansion rather than hastily pursuing profits at this stage.
The capital market, influenced by Cisco's 135% annual revenue growth and equally impressive profit figures, saw a 3.6% increase in Cisco's stock price on the day the financial report was released, closing with a market value of $57.6 billion. This surpassed the food and tobacco giant Philip Morris and was second only to the long-established industrial giant General Electric, with a market value of $79.1 billion, making Cisco the second most valuable company in North America.
After a series of various corporate mergers and management equity incentives, Westeros Company's shareholding ratio in Cisco had decreased to 46.3% by early 1994. Based on the market value of $57.6 billion on February 25th, Simon's Cisco shares were valued at $26.7 billion, surpassing any other wealthy individual listed on the Forbes list.
On February 28th, the last day of February, America Online followed Cisco in releasing its 1993 financial report.
America Online had also initiated a global expansion plan. However, unlike the relatively low barriers for internet equipment manufacturers like Cisco, America Online's expansion in the telecommunications field was slower and primarily in the form of joint ventures. Therefore, its operational focus remained in North America.
As of December 31, 1993, America Online's total user base in the United States reached 32.61 million, with an 88% year-over-year growth in users, down from 125% in 1992. This was mainly because the internet penetration rate in America Online's original operating regions was gradually increasing. Although there was still substantial growth potential, the speed of residents accessing the internet began to slow due to factors such as infrastructure and economic conditions.
Even so, with over 30 million users, America Online had captured 71% of the total World Wide Web user base in the United States, far exceeding any other internet service provider in the country at that time.
Leveraging this enormous user base, America Online achieved a total annual revenue of $9.15 billion in 1993, compared to $3.87 billion in 1992, with a growth rate of 136%. This data exceeded the expectations of most Wall Street analysts.
However, due to substantial investments in infrastructure and ADSL network upgrades, America Online's losses in 1993 reached $769 million, a 194% year-over-year increase.
The capital market had anticipated America Online's losses, so the reaction was not too intense.
Notably, after issuing $1.2 billion in corporate bonds last year, America Online's total debt remained at a modest $2.6 billion. Compared to the company's market value of over $50 billion, its corporate debt ratio was less than 5%, far lower than that of other companies in the same industry.
With America Online set to engage in fierce competition with local operators in regions beyond the East and West Coasts, such as the Great Lakes and the southern United States, losses were expected to widen in 1994, possibly exceeding $1 billion.
Simon had been aware of this expectation since last year, and the capital market was also well-informed.
Therefore, despite the substantial losses reported in America Online's financial data, it did not affect the stock price's upward trend. On February 28th, the stock price rose by 2.7%, closing with a market value of $56.2 billion, also surpassing Philip Morris, ranking third in the market value of American companies, right behind Cisco, which had a market value of $59.1 billion.
Due to various equity operations, Westeros Company's shareholding ratio in America Online slightly decreased to 65.5%, with Simon's America Online shares valued at $36.8 billion on February 28th.
Just over a weekend, the value of Simon's Cisco shares increased from $26.7 billion on February 25th to $27.3 billion on February 28th, with a paper gain of $600 million in three days, exceeding his personal spending on real estate, women, and other expenses of around $500 million over the past year.
In fact, Simon's personal spending did not require the liquidation of his shares.
Next, for Eaglet, which was not yet publicly listed and had no plans for an IPO in the short term, Simon did not intend to disclose its financial report. Like the nearly 400% growth last year, even though the growth slowed after the 1992 explosion, it was still significant in relative terms.
Eaglet's specific financial data remained highly eye-catching.
Moreover, media closely following new tech companies were most interested in Eaglet among the three internet companies under the Westeros system. To avoid endless speculation and exaggerated fabricated data, Eaglet deliberated and released a relatively simplified financial report on March 7th.
In 1993, Eaglet achieved total revenue of $5.41 billion from software sales, YWS services, e-commerce, online advertising, software stores, and other popular internet businesses, with a year-over-year revenue growth rate of 179%. The annual net loss was $393 million, a 182% year-over-year increase.
Although the 179% revenue growth rate was far lower than the 394% in 1992, it still surpassed Cisco and America Online.
The $393 million loss was entirely within the acceptable range compared to Eaglet's revenue growth scale. For those informed about the detailed financial data, Eaglet's cash flow situation was healthier than both America Online and Cisco. At the current rate of capital consumption, the $1.5 billion paid by Goldman Sachs and Morgan Stanley for a 10% stake in Eaglet last year would be enough to sustain the company's operations for at least another two years.
Therefore, Eaglet, an internet company with revenue large enough to be included in the Fortune 500 list of American companies, still had a 'zero' debt ratio!
Anyone with a little business acumen understood how rare and valuable this 'zero' was.
Currently, Eaglet was almost equivalent to a combination of new tech companies like Netscape, Yahoo, Amazon, and Google in Simon's memory. The overall revenue scale of $5.41 billion was already terrifying considering the company's founding years. However, if its businesses were divided, several of them had the potential to grow into corporate giants.
The public could only speculate about the specific revenue of Eaglet's various businesses, but Simon had already obtained detailed data before the financial report was released.
Of the total $5.41 billion revenue, Amazon's online mall's annual turnover increased from $620 million in 1992 to $1.36 billion in 1993, with a growth rate of 119%.
Carol Bartz's YWS department was restructured last year.
Ygritte Dreamweaver, Ygritte Fireworks, and Ygritte Flash, basic tools for the World Wide Web, were reassigned to a dedicated software department. With the global demand for these basic tools rapidly increasing,
Eaglet's basic software sales soared from $280 million in 1992 to $810 million in 1993, a growth rate of 188%.
The standalone YWS department, still not directly marketed as cloud computing but continued as Eaglet Web Service, also saw significant market demand, with an annual revenue of $790 million.
The revenue of this core cloud computing business did not surpass that of the software department mainly because Eaglet did not want to reveal its vast scale and cost advantages too early. In competing with traditional data center service providers, it offered only slightly lower prices, making it less attractive to users. Many internet startups still preferred to buy servers and set up their websites themselves.
The internet bubble would eventually burst.
Due to the vast market demand, many tech companies, including established names like IBM, were investing heavily in traditional large-scale server data centers.
It could be predicted that once the internet bubble burst and internet companies compressed costs or went bankrupt, there would be a severe surplus of data center resources, increasing competitive pressure among service providers. At that time, Eaglet's cloud computing service's flexibility and cost advantages would become apparent, with even more mature technology accumulation.
IBM and other established manufacturers had noticed Eaglet's cloud computing technology and its significant cost advantages.
However, to protect their hardware and service businesses, these old-line manufacturers were not keen on following this technology closely and even resisted it inherently, as the rise of cloud computing would inevitably impact traditional server manufacturers' hardware sales, which were core businesses for companies like IBM.
On the other hand, for cloud computing, established companies were reluctant to follow, and startups, even seeing the vast potential of this technology, did not have the resources to compete with Eaglet due to the scale advantage that became more apparent as the cloud computing business grew.
Therefore, Eaglet's YWS was bound to dominate like Amazon's AWS in Simon's memory.
Like Kodak's refusal to embrace the digital age to protect its film camera business ultimately led to its bankruptcy, if one cannot eliminate oneself, they will be eliminated by others.
Including $120 million from other businesses like email technology licensing, Carol Bartz's department, primarily focused on enterprise users with internet infrastructure software and services, had total revenue of $1.72 billion, a 295% year-over-year growth.
The advertising business, which Simon had always valued the most, saw explosive growth due to the promotion of the Eaglet Advertising Alliance plan and the internet boom. Eaglet's portal site, social network, search engine, and advertising alliance's four major advertising business segments achieved a total online advertising revenue of $1.15 billion over the past year.
Although there was still a vast gap compared to the $40 billion annual advertising revenue of the American traditional print media industry, a 313% year-over-year growth rate would undoubtedly make traditional media industry operators even more vigilant.
A 313% revenue growth rate stood out even within Eaglet's extensive business matrix.
Moreover, the revenue from IE browser sales, which had always been listed separately, brought in $310 million globally over the past year through pre-installation by hardware manufacturers, telecom channels, and Ystore sales, with a 33% year-over-year increase. This growth rate was the lowest among all Eaglet's businesses, and the proportion of IE browser software revenue in Eaglet's total annual revenue dropped significantly from 12% to 5%.
The slowdown in IE browser software sales was mainly due to the open nature of the internet leading to rampant piracy. Some PC manufacturers and many small internet service providers at home and abroad, to save costs, either privately or encouraged users to use pirated IE software.
Eaglet's management focused on major PC manufacturers like HP, Compaq, and ISP giants like America Online, while doing its best to crack down on online pirated software resources.
Even so, the $310 million annual revenue largely benefited from Simon's insistence on a $10 pricing strategy.
The original Netscape browser was priced at $50, which was one of the main reasons it lost to Microsoft's IE. Even without IE, Netscape's high pricing and the internet's open nature would inevitably lead users to prefer pirated or free browser software.
Now, Eaglet's $10 pricing for IE browser software was within the easy acceptance range of most users, and even overseas users, considering exchange rates, did not feel too burdened.
While Tim Berners-Lee and other management highly valued the revenue from IE, Simon saw the possibility of making the software free from its gradual marginalization in Eaglet's total revenue and formally submitted the proposal to the Eaglet management for discussion after the financial report was released.
Making IE browser software free was no longer just about promoting the web but also about maximizing leverage in future antitrust investigations.
Many competitors and professional media had already noticed the unfairness of the fixed Eaglet portal homepage on IE browser and argued that users who paid for the software should have the freedom to set their homepage.
Once IE browser was free, such arguments would no longer apply.
Like the Android operating system, which was nominally free, the potential revenue it brought to Google each year reached hundreds of billions of dollars, and it also successfully transitioned Google from PC to mobile, which was even more critical. In the era of mobile dominance, another search engine giant across the ocean gradually fell out of the top tier of the internet due to frequent failures in transitioning from PC to mobile.
In Simon's IE browser software free plan, only the official website download was free. Hardware manufacturers and telecom companies' pre-installations, even if not charged at the $10 rate, could still generate revenue through licensing fees, so the free plan would not cause this revenue to disappear entirely and might even grow with the continuous boom of the PC and internet industry.
Lastly, Ystore, Steam, and Ypay's total revenue from software and game stores and online payment tools was $870 million, a 141% year-over-year increase.
For these businesses, except for the crucial Ypay online payment tool, others were merely to enrich internet content and did not receive too much attention. Simon even considered them disposable if necessary.
Moreover, Eaglet's venture capital department, which was gradually emerging, supported a series of internet startups. Since their shareholding ratios were generally below 50%, their revenue data was not included in Eaglet's total revenue. These startups had minimal revenue for now, and the venture capital department was still purely in the money-burning stage.
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