Rhythmone PLC (fka BLNKF)

[plfminthemiddle]

Good find on LSE with the following article:

http://www.sharesmagazine.co.uk/news/blinkx-divides-just-like-marmite#.URkb7WdZNGR

The paragraph that interests me is the following:

"But here’s the dilemma. Just how much should investors pay for this growth potential? Its harshest critics believe the Blinkx platform to be little more than an inferior YouTube, yet after the share price hike, the stock trades on a March 2014 price/earnings multiple of 22, according to Canaccord Genuity estimates."

This bit must have been the mantra of the monkeys "Its harshest critics believe the Blinkx platform to be little more than an inferior YouTube".

Now, surely that shows the problem with Blinkx; people do not understand its technology. Blinkx is not a Youtube. At one stage it might have tried to compete with Youtube but over the last two to three years it has changed its spots and has focused on a totally different market.

Now it is a facilitator of advertisements and search for companies who do not want to go to the cost of doing all the technical work of setting up support departments to develop product. In return, those companies share advertising revenue with Blinkx on a win/win basis. And there are hundreds of them who want this service.

Youtube is a dog's dinner of a product. You can shovel manure into Youtube to your heart's content and then it is up to Youtube to find the diamonds hidden in it at a huge cost to them, hence it has never made a profit.

Blinkx, on the other hand, controls exactly what it wants to find and for whom it wants to retrieve the information. Once again, the statement that the Blinkx website is only a "shop window" proves this. It is there to show what can be done rather than being the be-all and end-all in the way Youtube does and is.

So, Youtube might Ford but Blinkx is more Aston Martin. Now which would you prefer, a Fiesta or a DB9 or even a Rapide S?