Tom Taulli is the author of "Investing in IPOs" (Bloomberg Personal Bookshelf). The book can be purchased at Amazon.com by clicking here. You can reach him at tom@taulli.com

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What's in a name? On the Net, a catchy name can mean quite abit.

Perhaps that's why earlier this year, iName, founded in November of 1996, changed its name to Email.com. The new moniker is more descriptive and immediately conveys what the company does. Like rivals Hotmail, Microsoft, AOL, @Home, Yahoo, Disney, and Lycos, Email.com offers free Web-based e-mail accounts.

Email.com's service -- called Webmail -- lets users access and send e-mail using a browser. What's more, a user essentially has a permanent e-mail address, which follows him or her despite job changes, different ISPs, or after graduation from school. Email.com offers such addresses as @mail.com, @email.com, @doctor.com, @lawyer.com, @USA.com, and @Asia.com. In all, the company has 1,200 domain names.

Web-based e-mail is extremely popular. It helps to boost site traffic, broaden reach, get demographic information, and generate revenue opportunities. To date, Email.com has more than 100 advertisers. So, its not surprising that Email.com has now filed to go public. The underwriters include Salomon Smith Barney and Painewebber. Wit Capital and DLJDirect are handling the Internet marketing. The proposed ticker symbol is MLCM. Although Email.com is ranked as the sixth largest provider of free e-mail accounts in the world (in February, it processed 100 million e-mail messages), it is losing lots of money.

In 1998, the company generated losses of $13.5 million and suffered negative cash flow of about $4.8 million. So it is no surprise that revenue is still quite small. Sales for 1998 were $1.5 million, compared with $173,000 in 1997. Still, the market for e-mail is huge. According to Cambridge, Mass.-based Forrester Research, daily global Net e-mail traffic is expected to increase from 100 million messages per day in 1996 to 1.5 billion messages per day in 2002.

The key to free e-mail is building a huge base of users. Email.com has accomplished this through strategic alliances with other websites. Unfortunately, these deals are very expensive. Basically, Email.com makes its money by selling targeted advertising and then splitting this revenue with the strategic partners. Some of these contracts call for minimum payments; thus, it is possible that a strategic partner may take 100 percent of the revenue generated from the banner ads if minimum traffic is not met.

Email.com has agreements with such companies as CBS Sportsline, CNET, CNN, Paramount, and Time Warner. Three of Email.com's strategic partners accounted for 45 percent of the company's new members in February 1999. But these relationships can be tenuous. A major account for Email.com is GeoCities, which was recently purchased by Yahoo, which has its own free e-mail service.

But as long as the IPO market continues to be hot, Email.com should do quite well. However, in the long run, it seems this company would probably do better to merge with another company following in the footsteps of Hotmail.com, which was purchased by Microsoft for "hundreds of millions" in late December 1997.

For comments/questions, contact Tom Taulli at ttaulli@bpia.com.

Commercial: Readers interested in IPOs may want to check out The Investor's Guide To New Issues: How To Profit From Initial Public Offerings, available in our bookstore.