Investors think it makes sense.

Yahoo's shares have rocketed from the high $50s in November to $127 3/4 on Thursday. No. 2 portal Excite closed at $73 1/8 a share, up from around $30 in January.

Infoseek closed at $35 1/8, up 5/8, after it announced the deal with Disney. It traded at around $10 a share at the beginning of the year.

"The first quarter of this year was pretty astounding," says analyst Patrick Keane of Jupiter Communications. While much of the stock run-up has been speculative, "the portal space is now serious business."

It's a risky business. There are few barriers to entry, and most analysts say there are already too many portals and that a shakeout is inevitable.

Someday, "you'll turn on the computer and there will be three big networks," predicts Jeff Mallett, Yahoo's chief operating officer.

Even that projection might be optimistic if lots of Internet users decide that they don't need to go through a portal.

"For 90% of the people looking for sports information, a search engine really isn't necessary," says CBS New Media Group President Derek Reisfield. "I can go directly to a couple of sites and be pretty happy. The industry structure is not set in stone."

Advertising prospects are particularly murky. Most companies are still testing the medium and only sign short-term contracts.

There's little solid data to show that banner ads on a Web site have much impact on viewers. Indeed, there isn't even a single, generally accepted measure--like television's Nielsen ratings--to determine how many people visit a site.

The business also could suffer if lots of consumers start to use software that filters ads from the screen.