IBM Corp may be fated to hang on to Prodigy Services Co, in partnership with Sears, Roebuck & Co or on its own, because nobody seems to be prepared to pay a price for it that would be acceptable to the pair. According to the Wall Street Journal, each has briefed a rival firm of investment bankers, Sears to try to find a buyer for its 50% of the on-line service operator, IBM to help it make up its mind what to do with Prodigy. But the two are said to have sunk over $1,000m into the thing over the past decade and are not keen to see less than that figure back: Sears is thought to want as much as $500m for its 50% stake. The problem they face is that in face of the rush to the generic Internet and its World Wide Web, all proprietary on-line services – even Microsoft Corp’s Microsoft Network, are now seen as rapidly wasting assets. It is not clear that anyone will want to come in as a new partner for IBM except as part of some much broader and grander alliance in which the investment in Prodigy looks like small change – or that anyone will want to buy Prodigy outright at other than a knockdown price. Strangely, AT&T Corp, which has now scaled back plans for its own service, reportedly did approach IBM about buying the Sears stake last month, but IBM sees AT&T as a competitor and vetoed the bid.
