To toss a bone, how about looking at the emerging marketplace in which F5 Networks (FFIV) operates in. FFIV is a local Seattle company that went public just recently.
Taking some verbage from their filings before they went public:
Their proprietary software-based solutions monitor and manage local and geographically dispersed servers and intelligently direct traffic to the server best able to handle a user's request.
The company's customers include Internet service providers, such as Exodus Communications, PSINet, MCI WorldCom, e-commerce companies and many other organizations that employ high-traffic Internet sites.
I believe NASA had implemented their solutions to direct huge bursts of traffic to multiple underutilized servers when attention for one of their space launches increased.
Is there an emerging tornado for this market? Under Moore's definition of a tornado:
When year-to-year growth approaches or exceeds 100%, and when quarter-to-quarter growth also is rapidly accelerating, a tornado has begun.
Looking at FFIV's financials, we find:
Net Revenues (In thousands):
Year-end 1997: $229
Year-end 1998: $4,889
6-Mos. ending 3/98: $1,837
6-Mos. ending 3/99: $6,457
That looks like a potential seed growing.
But for a well-rounded look, we must also examine their competitors. From the filing:
"Our principal competitors in the Internet traffic management market include Cisco Systems, Alteon WebSystems, ArrowPoint Communications, HydraWeb Technology, RadWare and Resonate."
A casual glance at a list of publicly traded companies shows only Cisco as being the publicly traded competitor. The rest are privately held, but some have received significant funding and recognition for their products, like Alteon, which has been recognized by Enterpreneur Magazine and Red Herring for their innovations.
Given that revenue growth numbers are rather hard to find for these private companies, I'm not sure we can move ahead and call a tornado market is among us yet. But it certainly does warrant keeping track of the market...
--Rainier |
