Mixing Media, Sensibly

CNET's rally Monday shows what can happen with the right mix of old-line and online media.
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The gods of stock irony are cruel and harsh gods. They teach us that one must not mix less-than-premier old-line media with premier online media if one wants to make money. But that a premier old-line media company can still help a rapid growing Net concern if combined correctly.

Isn't that what the rallies today in

Lycos

(LCOS)

and

CNET

(CNET) - Get Report

told us? No one would have minded if Lycos had merged with someone that could help build the brand. But to have it diluted by someone, especially someone without much reach, was regarded as just plain loathsome. So Lycos jumps $15 points on the good news of an abandoned bid.

But CNET, on the other hand, is teaming up with

GE's

(GE) - Get Report

unit

NBC

, which has the possibilities of some valuable cross-promote, so valuable that CNET roared. That made sense to me; lot of synergies there.

The key takeaway here isn't that old line and new line don't mix. It's that when they mix, they have to be able to help each other, rather than just help one partner.

The management of Lycos, long chastised by me for doing the wrong thing, deserves praise for not taking this transaction to a vote. If Lycos had lost that vote, then surely Bob Davis would have had to resign. Now he gets to keep his job and gets another chance to make money for his shareholders.

I think that is fair. Before Davis went Hollywood he was doing a fine job putting together a great portal. I wish him luck getting back on track after a nasty sideswipe. All I ask is that he come out and admit that he made a mistake, that he was wrong, and that he misjudged both the strengths of his own company and of the Net.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

letters@thestreet.com.