Not that I have any reason to think they will exceed or not exceed earnings estimates, but the statement "upside surprise this quarter due to its strong presence in the potentially huge market for Internet-related growth for the software industry" makes me wonder about the basis for any short term projections. My impression is that the whole PRGS ASP thing is just a plan at this point, a plan with a couple of companies who have expressed intent, but no real business happening at this stage. So where does the big internet-related influx of revenue come from. Sure, a few more people are using WebSpeed than before, but 99% of that is web-enabling, mostly limited, by existing VARs, not some big groundswell of new customers.
With 70% of current revenues coming from VARs, big increases in revenue have to come either from the VARs all of a sudden becoming more successful, which I see no reason for, or from developing a new customers. I have trouble seeing waves of new customers coming in for the existing 4GL product and limited growth for Apptivity, so the ASP thing is the *big* hope for a new channel, but when will this really start to produce and, is it really anything more than just another way to help out their existing VARs? |
