APPNET: Roll-up lacks powerhouse patina

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appnet rolled up a dozen interactive ventures the year before the company's June 1999 IPO.

Better known for its capabilities in Web integration and e-business solutions, AppNet is intent on building the reputation of its interactive marketing and advertising.

"To be competitive, an interactive company needs to have both the technological capabilities as well as standout creative," says David Levin, division president-Interactive Services Group, AppNet. "Marketing interactively is far more challenging than traditional advertising, and neither the technology nor the advertising message can take a back seat to the other."

ROI TRACKING PROGRAM

With that philosophy plus a proprietary return-on-investment tracking program, Ad Maximize, AppNet has attracted and retained business from clients such as GMAC-MortgageRamp.com, Hewlett-Packard Co., the National Aeronautics & Space Administration, Paramount Digital Entertainment, Sprint Corp. and, most recently, BP Amoco.

The giant petroleum marketer hired AppNet in May to create a business-to-business Web application.

Redefining a business for the Internet requires more than back-end expertise, so AppNet offers a mix of Internet strategy, marketing and technology services.

In May, the company announced it would acquire Edgar, Dunn & Co., an e-business consultancy.

STILL LOSING MONEY

AppNet last year lost $79.5 million on revenue of $109.7 million, including assignments both related and unrelated to marketing. In the first quarter, AppNet lost $19.4 million on revenue of $44.7 million.

AppNet stock in mid-June traded around $3o a share, far above its $12 IPO.

The first quarter offered a small cautionary note about the hazards of doing business with dot-coms: AppNet took a $3.4 million hit in the form of uncollected accounts receivable when Prime Retail, a shopping center company, abruptly folded its e-tail venture, eOutlets.com.

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