Thursday, July 17, 2008

What They Won't Be Asking at the Overstock.com Conference Call


Overstock's supine analysts won't be asking about the Omuse disaster

My favorite corporate sleaze poster child, Overstock.com, has a quarterly earnings conference call tomorrow, and you can bet that there's one subject that Overstock's supine and intimidated analyst corps won't be raising: the company's disastrous "Omuse" user-generated wiki.

Omuse was a blatant squandering of corporate resources, initiated in late 2006 as a cover story for the hiring of the nauseating Judd Bagley as a kind of in-house stalker, under the title "director of social media." The site was an instant failure, but it didn't really matter because Bagley's real job was to attack critics of Overstock CEO Patrick Byrne on his "antisocialmedia.net" smear site. Byrne recently dropped any pretense of separation between stalker and company, and now pays the salary of Bagley and two other halfwits, Evren Karpak and the eccentric ex-journalist Mark Mitchell, via a website he finances called "deep capture."

But what about poor old Omuse? Well, it has been in "beta testing" now for over a year and a half, and it is essentially defunct. Its most active user is the terminally wacky Byrne, where it serves as a forum for nutty tirades, but no one else seems interested.

Over the past three months, the users of Omuse, which is promoted on Overstock's main page, have created a grand total of seven new pages, all but one consisting of brief starter pages. See for yourself.

Given Byrne's habit of bullying and intimidating analysts, most notoriously in his junk lawsuit against Gradient Analytics, analysts walk on eggshells at these quarterly conference calls, rarely challenging Byrne and his minions on much of anything. Yet despite an ostensible interest in issuer retaliation, the SEC has turned a blind eye to Byrne's aggressive tactics.

I doubt that even Overstock's board of directors, which Byrne has under his thumb, would dare to raise the subject either.

So don't expect sore subjects like Omuse to come up tomorrow. The analysts who cover this company may not be very bright, or courageous, but they aren't dumb. I realize that being assigned to cover a company run by a one-man lunatic fringe is no bed of roses, but these guys don't even try.

© 2008 Gary Weiss. All rights reserved.

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