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The Internet remains an exciting industry for investors due to mergers and partnerships between Web companies and media, entertainment, and communication businesses. The Internet has completely changed retail and entertainment businesses in the United States. It is anticipated that approximately 100 million Americans will be 'surfing' the Web by 2000. During the 1998 Christmas season, retail sales reached $4 billion. However, as price/earnings valuations far surpass companies in other market sectors, the Internet remains a very speculative investment propostion.

Stocks in the Internet industry are only for those investors who can tolerate risk the most, even though many of these equities have been leaders in the bull market of the 1990s. Investor interest has been pushed higher by the possible merger of Netscape and AOL, but investors must be willing to adjust to price swings, high price/earnings ratios, and other pitfalls. Several of these stocks are timely for 1998 and 1999, but are best suited for speculation.

The year 2000 computer transition problem could be not only expensive for computer service and software companies, but the way that dates are coded for computers could also bring many businesses to a halt. The expenses for conversion could be over $100 bil in the US alone. However, the business need for technology gives this industry bright prospects. Many of these stocks have superior potential for the next three-to-five year period.

The forecast for the computer software industry in 1997 is mixed as the saturation of small business and home computer markets, slower mainframe sales and desktop upgrading may slow software sales. Microsoft Corp operating system sales are good, however, and service and software providers are forecast to have a good year in 1997 and 1998. Industry growth is expected through 2002 and several of these stocks should be good performers.

The computer software and services industry is expected to do well during 1997 and into the next century. The economic environment is expected to remain beneficial for this industry. There are stocks in the computer software and services industry that are expected to do well in the short term and the long term but there are also volatile stocks that will not be appreciated by the conservative investor.

The software industry should fare well during 1997, although economic growth will be slower. Many firms should record revenue and net profit percentage increases in the mid-teens. During 1996, these firms are doing well, although hardware sales during the first months were hampered by too many personal computer introductions. Personal income and corporate profits should increase 5.5% and 5.0%, respectively, during the last quarter 1996.

Computer software and services stocks are expected to do well until the year 2000 because sales and profits should continue to be solid in this industry. Economic growth may slow down through 1997 but it is not expected to regress. Personal income is expected to increase and business income is expected to increase so that there will be constant purchases of new software and hardware.

Rapid expansion for the computer software and service industry is expected through the 1990s. Domestic sales of personal computers grew 15% during the 1st qtr of 1996, and sales growth of 15% to 20% is forecast through the end of 1996, as well. The outlook for computer software and services during 1997 and through 1999-2001 is also strong. There are several timely stocks in this industry for 1996, and many can be selected for long-term investment.

Good sales and earnings are expected for the computer services and software industries, not only in 1996, but through the end of the 1990s as well. Growth is expected to be rapid for software companies as other industries seek applications systems for greater efficiency. Outsourcing will increase growth for computer service companies as well. These stocks are ranked to outperform the market in 1996 and for 1998-2000.

Current US economic conditions are good for business and consumer investment in computer hardware and software. Revenue and earnings for computer service and software companies have been good for four years and posted gains for the first three quarters of 1995. This will continue in 1996 and through the years 1998-2000. Markets in the former Soviet Union and Asia will increase. Several of these stocks will outperform the market in 1996.

Consolidation is continuing in the computer service and software industries and is expected to endure. Revenues and earnings have been good, especially in the 2nd qtr of 1995, for computer software companies, and this will last through 1996. These stocks have outperformed the market since 1994 and will do well into 1996. Several equities have long-term capital gains potential through 1998-2000, and are good investments. Company reports for major software companies are presented.

Consolidation is continuing in the computer software and services industry in 1995, and further acquisitions are expected in the future. Large revenues and earnings are also being posted for 1995, due to expansion in the US and overseas economies. Those seeking capital gains for the next three-to-five years will find stocks of interest, and many are timely, but conservative investors need to be selective.

Computer software and services stocks are expected to perform well through mid- to the end of 1995. The industry will be helped by strategic acquisitions, such as Microsoft's planned purchase of Intuit and Sybase's planned acquisition of Powersoft. Long-term investors can find several attractive options. Conservative investors should be wary of potential fluctuations in computer stock prices within a relatively volatile industry.

The computer software and computer services industry is poised for strong growth through 1994 and through the 1997-1999 period. Demand for software applications will continue to grow, helped in part by price cuts in personal computers. Software companies, furthermore, are expected to consolidate in an attempt to achieve better economies of scale. Computer services companies are also expected to post strong gains, helped in part by the increasing divestment of peripheral businesses. Investments in this industry are probably not appropriate for conservative accounts.

Mergers and consolidations in the computer software and service industries continue. For example, Computer Associates International Inc plans to buy ASK Group Inc, and Novell Inc agreed to acquire WordPerfect Corp and also the spreadsheet line from Borland International Inc. Many companies are doing very well because lower computer prices are spurring demand for software. Many software and computer service company stocks are good buys and can be expected to perform better than the market.