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London gets Internet index
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March 31, 1999: 12:42 p.m. ET
FTSE International launching Web grouping April 1; analysts are critical
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LONDON (CNNfn) - London's stock market authorities will launch an Internet sub-sector Thursday, although six of the eight initial members of the index will be drawn from London's less tightly regulated stock market.
FTSE International will get the new sub-sector off the ground April 1 as part of the launch of a dedicated Information Technology stock market grouping.
The eight members of the sub-sector all are small players in the Internet field, and the decision by FTSE International to set up the listing has drawn criticism from analysts, who claim the authorities are merely jumping on the Internet bandwagon.
The eight constituents are: Dialog Corp., Easynet, Intelligent Environment Group, Internet Technology Group, Gresham Computing, Netcall, VirtualInternet and Vossnet.
"I'd be very wary [of this sub-sector]" said George O'Connor, technology analyst at broker Granville. "And if you are looking for exposure to the Internet, look beyond the obvious ones that FTSE has picked out because they don't necessarily offer the greatest upside."
The main concern is that all eight members are relatively small companies, with the big Internet players in the U.K. being either U.S. subsidiaries or units of larger U.K. corporations. The largest Internet service provider in the U.K. is electrical retailer Dixons (DXNS), which does not qualify for the sub-sector.
Six of the eight come from the Alternative Investment Market, equivalent to an over-the-counter market in the U.S., which is less tightly regulated than the full exchange. 
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FTSE International
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