Q1 results were disappointing but with all the changes taking place at ISI, trying to focus on last quarter's numbers is like looking in the rear view mirror to understand where ISI is going.
Since Boesenberg joined ISI, he has emphasized in press releases, conference calls and at financial presentations that one of his major priorities will be making strategic partnerships, acquisitions, and investments. The Sun deal as well as with Pointbase and investment in Rapid Logic demonstrates that Boesenberg is moving very quickly.
By partnering with Sun and getting them to commit to a minimum amount of revenues to ISI over the next two years makes this more than just another licensing agreement. Suns's sales force will be putting design ISI's services in front of hundreds of customers over the next two years. Sun's sales force will get full credit for an ISI services sale. It is likely that many of these customers that go with ISI services will also go with pSOS, pRISM+, and ISI's tools.
With a single bold stoke, Boesenberg has repositioned ISI as a leading contender in the JAVA based embedded internet appliance market. Last year, ISI's former CEO was betting the future of ISI on lining up with Microsoft and Windows CE. It has been increasingly clear that Microsoft has flopped once again in its attempt to enter the embedded market. WIND was able to jump into an early lead with embedded JAVA applications with Sun's JAVA. Customer's have wanted Sun's version of JAVA despite some of its drawbacks such size, performance and pricing models. With Sun's new JAVA2, Sun has demonstrated they are not only serious about the embedded market but are willing do what it takes to provide what the embedded market wants.
While the results of the quarter were disappointing, from the conference call it sounds like Boesenberg has reorganized and strengthened the sales force and much of the baggage of the old ISI is being dealt with. The West coast sales force has been completely reorganized and is now fully staffed. If Boesenberg keeps making the kinds of deals he did with Sun, INTS share price will be a lot higher a year from now. If ISI had made their quarter with the Sun announcement, INTS would most likely be $17 - $18 today. |
