CD REVENUE: In John Jenkins (CEO) own Words
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Question: "What do you see in revenue for the future on your CD?"
John Jenkins: "Well, the opportunity (let me roll it out that way for the moment), first of all when we sell tools, its a combination of the CD, which is sort of the key to the compliance
data base - so there's our pricing model there (and if I'm being redundant for some of you, appologize) - but its basically ...
$4000 for the CD. That includes the methodology and several support tools.
Then to switch on and have access to the vendor compliance database, your talking about $5000 per site. The CD price is per seat.
So in a straight forward model, you've got somebody who buys 1 CD. He pays 4000 for that, he's going to pay 5 for the vendor compliance data base access, and he's going to pay $200 per vendor compliance report.
Most organizations that we're looking at on the small end of the quote average range would have at least 100 unique devices in their facility. So its 100 x $200 = $20,000. He buys some training along the way. You can get to a model that says between $30,000 and $35,000 on an average basis per individual facility.
The total facility count out there is, on a conservative basis, between 70,000 and 100,000 facilities that have to address this problem. So its a very large number at the high end. We won't reach all those facilities and not everybody's going to pay retail price. When you sit at the table with somebody that's got 600 sites to address, there's a fair amount of negotiating pressure from his side of the table. But I think we've used a conservative number of about $20,000 per site for a straight up tool purchase by a client. I still think that number works and I have no reason to push it one way or the other at this point.
The mix of tools and services is hard for us to pin down today. We've got a wide range. Some organizations have absolutely no engineering staff and they want to buy services wrapped around tools. Others have solid engineering staffs and are really looking at tools and projects.
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Transcript from 11/4 Conference Call, contributed by Clayleas Reply #6078
CLAYLEAS SIDEBAR: OK, so potential for tools alone for what's in the pipeline is $20,000 x 3500 = $70MM!!! |
