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Red Hot iMall Stock Headed for Nasdaq NMS

By James Hollander ECT News Network
May 19, 1999 12:00 AM PT

It may sound cliché, but… When you're hot, you're hot, and iMall is sizzling this week.

Red Hot iMall Stock Headed for Nasdaq NMS

In what is certain to be one of the most exciting 48 hours for iMall (Nasdaq: IMAL), the company announced that its application to Nasdaq for listing on the Nasdaq National Market System (NMS) has been approved, and the company's stock will begin trading on the NMS as of May 20, 1999.

This news follows closely on the heels of an earlier announcement that iMall's e-commerce technology, jointly developed with First Data Merchant Services Corp., was chosen by IBM (NYSE: IBM) to deliver e-commerce services targeted at small and medium businesses.

"Receiving approval for listing on the Nasdaq National Market System represents a major step forward for our company and its shareholders," said Richard Rosenblatt, iMALL's chairman and chief executive officer. "Not only does this listing make our stock more accessible to a larger universe of the professional investment community, but it clearly signifies that we have completed yet another significant milestone in our development."

In the past year, Santa Monica, California-based iMall has been rapidly expanding its operations from an online shopping mall into vertical e-commerce markets, offering a broad range of software and services for online merchants. To that end, iMall has forged strategic alliances with e-commerce technology providers like Pure Payments and First Data Merchant Services Corporation, a wholly owned subsidiary of First Data Corporation (NYSE: FDC).

IBM Chooses iMall/First Data Services The iMall/First Data partnership continues its momentum of e-commerce success. On Tuesday, the companies announced plans to integrate the jointly developed e-commerce solution from iMall and First Data into IBM's HomePage Creator. The resulting package is designed to provide many of the key e-commerce elements required for online merchants to begin selling products and services over the Internet.

According to Sanjaya Addanki, vice president, hosted business application services, IBM Global Services, the integrated product will enable small and medium businesses "to take online credit card orders over the Internet in a security-rich environment, and help drive traffic to their Web sites."

According to David Geller, industry analyst for the E-Commerce Times, "This deal indicates that the iMall/First Data alliance has produced a package so attractive that is fit for the king of e-commerce, IBM. To date, IBM has been extremely successful in providing enterprise-class solutions, and now it is making a big push to scale its e-commerce platform to the needs of the fastest growing segment of the market, i.e., smaller businesses.

From iMall's perspective, the news here is that the company has made good on its promise of moving into the e-commerce software and services arena, far beyond its primary business of being an online mall. This move presents an entirely new revenue model for the company and, just as significantly, provides an incredible amount of industry-wide goodwill. From a sales perspective, we can expect iMall and First Data to convey to other potential partners that, "if it's good enough for IBM, it's good enough for anyone."

Those of you who are following the online mall industry may be wondering whether, at a time when Intel just shed its e-commerce software component of iCat's operations, is it wise for iMall to move into that area? In a word, yes. In iCat's case, parent company Intel apparently decided that the standalone e-commerce software market is overly saturated (in other words, marketing their product would require too great of an investment).

In this case, however, iMall is providing an integrated solution backed by IBM's giant marketing machine, so the odds are in iMall's favor, even without a substantial investment in marketing.

Richard Rosenblatt told the E-Commerce Times, "Intel discontinued iCAT's software business, but retained its online Web building and e-commerce service, signaling the viability of iMALL's model. Our solution is housed on iMALL's servers and allows the merchant to engage in online commerce without ever purchasing hardware, software, or running an MIS department. iMALL/FDC and its partners provide the technology, the merchant provides the products and can begin selling immediately."

With a growing list of high-profile clients like, Verio and now IBM, it is not surprising that John Duncan, executive vice president, First Data Merchant Services predicts, "this solution represents the first of many we expect to bring to market."

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