A cautionary tale, set to music Three Internet IPOs rocketed out of the starting blocks in the past few days, bringing joy to the hearts of corporate insiders, early investors and cyberspace stock shills.

Including us. After all, we like a mad gold rush as much as anyone. We are bullish. We are upbeat. We see the glass has half-full, and whatever other optimistic platitudes you want to throw in here.

However, we have seen other things, things that would try the soul of a venture capitalist, if he had one. We have seen what happens after the ticker-tape parade, when the crowd's chant of "visionary" has subsided and the accolades are a distant memory.

First, though, the feel-good stories, starting with Inktomi Corp., the San Mateo, Calif.-based maker of network caching and Internet search engine technologies. When we initially wrote about Inktomi's IPO (NW, April 27, 1998, Page 87), we predicted it would be "one of the more interesting Internet plays of the year on Wall Street."

Talk about understatement. Inktomi, in fact, became the fastest-starting Internet IPO since Amazon.com.

Debuting on June 10 with an asking price of $18 per share, Inktomi's stock surged almost immediately to more than $40 per share, and is currently in the mid-$30s.

Two days later, NetGravity Inc. entered the fray. Also based in San Mateo, NetGravity makes software for managing online advertising and direct marketing. Opening at $9 per share, NetGravity is now trading around $15.

And last Wednesday, software.net Corp. of San Jose opened strong, as its stock price quickly rose almost 50% above the $9 per share asking price and is now trading around $13. Formerly CyberSource, software.net is an online reseller of software to individuals and businesses.

These three companies deserve to celebrate their good fortune. Perhaps they should throw a party. But where to get the music for the event? How about from CDNow Inc., the first online retailer of music?

Last summer we cited CDNow as one of our favorites Web sites. Based in Jenkintown, Pa., CDNow offers obscure CDs you can't find in stores, along with 30-second audio samples of thousands of songs.

While we're still happy to visit its Web site, we're even happier that we don't own any CDNow stock. After going public in late February with a $16 asking price, CDNow's stock rose slowly through March and then surged to almost $40 in April. Since then it's been almost all downhill, and though the stock's value of $18 or so per share is still above the original asking price, the company canceled a planned secondary offering early this month, blaming a soft market for Internet-related stocks.

It's more likely that CDNow didn't want to get steamrolled by Amazon.com Inc. The online bookseller announced on June 11 that it was entering the online music business. The Seattle-based company - whose stock has risen from $29 to $79 per share since early January - is a true Internet commerce legend, the kind of competitor that chews up vendors with less name recognition and financial muscle.

Here's CDNow's dilemma: You're a satisfied Amazon.com customer and you decide you want to buy music online. You've never heard of CDNow. Guess what? You probably never will, since you likely won't look past the Amazon Web site for your music needs. So much for growth potential.

CDNow was started by twin brothers Jason and Matthew Olim. Not since Milli Vanilli has a music industry duo's fortunes appear to fall so far so fast.

When the music's over, Part II

A couple of years ago, just when Internet copyright issues were first being debated, Network World featured a story about a music publisher's efforts to close a Web site that offered sheet music to guitarists around the world. (NW, March 11, 1996, Page 1)

The Online Guitar Archive (OLGA) received a threatening letter from EMI, the world's largest music publisher, alleging that the free posting of guitar chords and tablature for thousands of songs constituted a copyright violation.

Lacking the resources to mount a court fight, OLGA shut down. But only temporarily. Within weeks the site quietly began adding more songs and offering access to users, without drawing any legal attention.

Now OLGA may be dead for good. On June 9, the site closed in the face of a threat by music publisher Harry Fox Agency, which said it would bypass a cease-and-desist order against OLGA and proceed directly with a lawsuit.

Corporate lawyers vs. broke musicians. Who do you think would win?

Ask not what 'Net Buzz can do for you, ask what Internet- and intranet-related news you can give to 'Net Buzz. Contact Chris Nerney at (508) 820-7451 or cnerney@nww.com.