ELON in G & K THREAD HISTORY: V. 2.0
(My first post was cut off)
Or How the thread bags a little defenseless baby crypto-Gorilla: The First Act
1. First Blood
First Mention Award of ELON goes to Blan, who chose to debut on Silicon Investor with a prescient thread suggesting that ELON was a primate in vitro:
What intrigues me about the company, in the context of
the GG game, is that it appears as if ELON is being
*groomed* for gorilladom. Is this possible? While GM says
a company cannot choose to be a G, I wonder if two Gs
couldn't birth one? At present, ELON is no more than a
primate in vitro (if that), but I wonder about its future--
particularly with CSCO as a doting mother and MSFT as a
tolerant but distant father.
On October 27, 1999, ELON's LonWorks was declared the "open industry standard by the American National Standards Institute (ANSI)."
biz.yahoo.com
A mysterious Mr. ThatDadGuy, on Oct. 29, 1999, followed this news up. Beginning with the declaration that he was "hopelessly addicted to momo investing", his mention of ELON as a possible "shiny pebble" was of interest only to Uncle Frank, who declared that ELON was indeed only a shiny pebble.
From there, third mention goes to janet_wij, who brought up a small investment she was leery to give up, ELON, even though she didn't see it as a gorilla at all:
This one fails the GG tests. Market cap too small, no tornado, and will the market standardize on Echelon's Lonworks? It is far too early to answer this question.
UncleWest gets into the action on December 21, referring Janet to the October 27th release and declaring that the market had indeed standardized on ELON.
2. Build Up
True discussion of ELON only emerges with the New Year, when Janet posts an impressive picture of a world where ELON's products are everywhere.
Message 12437186
chaz thanks her, and voop declares it's been on his radar.
Then, a Mr. Mike Buckley emerges to actually DNA test ELON. Casually, he declares that his "guess" is that LonWorks
is indeed an enabling technology, but that it faces competition -- unusual with an enabling technology.
From there, things get even more exciting. Young whippersnapper GaryX excitedly posts, in a somewhat too enthusiastic all bold type, news that three agencies from Finland have agreed on ELON as a standard. He asks for responses and recklessly declares that ELON seems to be
entering a full fledged tornado with some solid command of the market....
Alas, nobody responds, and undaunted GaryX comes back with a more considered argument on January 11:
Message 12538219
It seems like this technology has a high degree of mass market potential, is a discontinuous technology, and has no remaining constraints.
The veteran hunters rise to the challenge. UncleWest asks about ELON's revenue sources. DownSouth wants to know about
1. Barriers to entry
2. Value chain
3. Identify the chasm to be crossed
4. Existing competing standard(s)
Mike Buckley attempts to set the tone of the Echelon debate straight:
There is one vitally important point you don't make clear (at least not to me) in your posts: Is the company's core business based on a proprietary architecture? Without the proprietary architecture the company will participate at most in a royalty game.
You mentioned that the product is at the start of the tornado. Unless it is a consumer-based product (which it appears to be) that's not possible unless at least one pin and preferably two or more pins in the bowling alley have been knocked down.
Even so, I suspect there is a good chance the product has not yet crossed the chasm.
Chastened, GaryX backs away from his more expansive claims:
siliconinvestor.com
and titles his post Overexuberance and Retrenchment on ELON
He declares, angry that jungle hunting is so treacherous, that ELON
clearly isn't at the beginning of a tornado. Its revenue
growth is not impressive, it has never broken even in its life, and it survives on dreams of a great future. He claims that it is a mere bet right now, but says "possibilities are enormous and its positioning impressive."
One can only assume from the odd tone of this post that this novice hunter was attempting to control the passions of his first hunt.
UncleWest, revealing that he has been tracking ELON closely, posts news that MSFT and SUN had teamed with ELON:
Message 12566433
Emboldened by UncleWest's comments and the news, GaryX returns to the jungle:
MSFT provides the software, ELON the architecture and GE the appliance
ELON seems to be in a great position here, with the ANSI standard and what seems like an entire new industry wrapping around it....It's an open proprietary system with massive consumer appeal. No, the tornado hasn't started, but the advantages to the system is clear -- energy savings, additional control -- business advantage is obvious and consumer market seems inevitable. and even
gets up the courage to declare that Their patents on the architecture would seem to make them a classic gorilla... He ends by declaring "Tornado Watch in effect."
Message 12567093
UncleWest encourages the orphan gorilla on January 13:
ELON has been tossed around and generally ignored...I asked yesterday if it could be an instant gorilla since it was announced the ANSI standard a week ago.
I know...I know...we need a tornado first.
Or do we? The settlement is often stated as when QCOM became a gorilla. Was QCOM in a tornado when the settlement was reached or did it come after?
Message 12565752
Chaz picks up the devil's advocate position, making fun of the "talking refrigerator" part of ELON's technology:
siliconinvestor.com
and UncleWest is torn:
I realize that elon is clearly not in a tornado. Nevertheless my trader instincts where screaming at me to buy buy buy.
ELON's position in their market gets a bit of hearsay confirmation from 100cfm on January 14:
A previous post on Elon stating that they were primarily in the building automation business prompted me to call a friend who is in the building automation business. I asked him what the deal with Lon Works was. He stated that Lon Works is becoming the standard and that they have crushed their main competitor BacNet
3. Counterattack
No gorilla can be admitted easily into G & K, and konabound defends against this new interloper:
Message 12574112
My company is involved in Building Automation integration. Lonworks of course is very strong in that market but certainly would not say that they have "crushed" Bacnet. As in many cases it depends on which side of the fence you are on. Lonworks people feel they have crushed Bacnet and Bacnet people feel they are the force beating Lonworks and of course the answer is in the middle.
This scares 100cfm from the hunt, who takes a purist's stance:
Your comment about each side claiming victory is proof enough that Elon is niether king nor gorilla yet. There can be no question as to it's dominance of it's market before we invest.
On the run, ELON sees its primate status crumbling. One member even attempts to boot ELON off the web, declaring it of little interest now:
If you want to talk about ELON, or some other company which is in the midst of a gorilla game but can't yet be confirmed, there are two other threads when it's more on topic.
But gorilla hunter Mike Buckley defends ELON's rights with an eloquent declaration of his own Gorilla hunting philosophy:
I will buy the leading candidate for Gorilladom long before it is a Gorilla...My long-winded point is that while Elon might not be the most appropriate subject of this folder since the product probably has not yet crossed the chasm, we do discuss and invest in stocks here that are not confirmed Gorillas.
Message 12581354
The hunter who spotted the beast first, Blan, brings the thread back to the hunt with a look at the two sections of ELON's future stomping grounds:
I think there are two sides to this coin worth looking at -- the "smart home" and the "smart factory." The industry and/or military applications of Lon Works would probably ramp up first and faster and offer more revenues, but the consumer side will draw the headlines -- a powerful combination should this field develop into a full-fledged tornado. and wonders (drum roll please) if "Cisco, an early supporter of elon, is using Lon Works in their "home routers" or any of their other home products?"
4. The Loneliness of a Gorilla Hunter
The thread is at somewhat of a standstill until February 7, when UncleWest once again emerges from the jungle and confronts thread elder Uncle Frank with news that the scampish beast has "just knocked down honeywell."
Alas, his fellow hunters do not join him, and UncleWest returns to his hunt, determined and alone.
5. Gorilla Fever
On February 24, UncleWest brings back more comprehensive analysis of ELON's simian DNA:
Message 12959199
After whetting his fellow hunters with news of margins that are 62%, he quotes SUNW's CEO McNealy:
"People like to talk about everyBODY getting connected to the Internet, but actually, the bigger market is getting everyTHING connected to the Internet," said McNealy. "Everything with a digital electrical heartbeat is going to be connected to the Internet. By bringing everyday devices to the Internet, Echelon's LONWORKS system is central to making this happen."
And in more down-to-earth details of ELON's increasing value chain, quotes a January 31 press release revealing a vast array of LonWorks users:
The new LonMark members represent a wide array of industries. For example, US-based Ingersoll Rand is a major diversified manufacturer of industrial and commercial equipment and components, serving a broad range of markets worldwide. A member of the Fortune 500, Ingersoll-Rand includes among its many brands such well-known and respected names as Bobcat, Club Car, Dor-O-Matic, Ecoair, Locknetics, Schlage, Steelcraft, and Thermo King. Finland's Kone is one of the world's leading suppliers of elevators, escalators and services. San Francisco Municipal Railway (USA) joins a number of key equipment suppliers to the transportation industry in specifying LonMark products for rail transit applications in North America. Additional new Association members are: Baker Building Automation (USA); Bisset Automation (Australia); CIAC (France); CAN Engineers (Singapore); Drucegrove (UK); Havel Brothers (USA); Lochinvar (USA); M&C Engineering (Singapore); Semco Danmark (Denmark); Telda Electronics (Korea); and Zdania (Poland).
Finally, the group wakes up. Robert Jacobs seconds UncleWest and joins the hunt:
Message 12959970
yes to Uncle West's assessment. elon being annointed as ansi standard is equivalent to standards upon which others build products and applications is equivalent to cdma, msdos (later windows), and soon to be SiC (cree) for LED substrates...It only means that a builder, plant operator, home builder etc will specify Lonworks for interoperability much in the same way they specify twisted pair for telephones, etherlink for networking, coopper for plumbing supply, pvc for plumbing waste, gypsum wall board for interior finishes...
Mr. Jacobs declares:
With this statement they seem to have crossed the chasm and are on tornado watch:
"Echelon Corporation is the developer of LONWORKS networks, recognized internationally as a standard for open, interoperable control networks. With thousands of application developers and millions of devices installed worldwide, LONWORKS is the leading cross-industry standard for networking everyday devices in building, home, industrial, transportation, and public utility applications. Echelon offers a full range of off-the-shelf hardware and software products to support the development, installation and management of intelligent, open and interoperable control networks."
Less than three hours after UncleWest's gorilla analysis, a tender moment between a Silverback Gorilla and a itty-bitty one occurs, with CSCO embracing ELON. This news is posted twice on the thread:
Echelon Corporation (NASDAQ:ELON) today announced that its i.LON(TM) 1000 Internet Server has successfully completed worldwide field trials and has achieved certification by Cisco Systems under the Cisco NetWorks(TM)Program. The i.LON 1000 Internet Server is a breakthrough new product that enables millions of everyday devices networked with Echelon's LONWORKS(R) technology in homes, buildings, factories, and transportation systems to become part of the Web. In so doing, the i.LON 1000 paves the way for a wide range of new Internet-based markets and applications for industry and consumers alike.
www2.marketwatch.com
The Gorilla Hunt now becomes fevered. More posts are written on ELON in the next two days than for the entire era before the one-two-three punch of UncleWest, Robert Jacobs, and the CSCO press release. The bowling pins on the thread have been knocked down, and a tornado of discussion erupts.
Mr. Buckley asks for the names and addresses of the bowling pins.
Robert Jacobs claims the first pin is "building controls for commercial/industrial buildings" (ed. comment: isn't this the market, not the pin?)
Message 12961103
gdichaz writes that Elon seems to be in a pivotable role in value chain terms.
Seems like major gorilla candidate potential.
Worth watching closely and for those among us who are comfortable doing so, getting feet wet.
Newbie spiral3 calls ELON "the 'control network', sitting atop a variety of network infrastructures."
tdown gasps at the value chain: what a value chain: csco, sunw, msft, honeywell, ge, and more. For the likes of these to be signing on to the LonWorks standard, there has to be more to this new market than mere "facilities management."
But before being initiated into the thread, ELON must survive some attacks. konabound seems to be the voice of skepticism, drawing attention to ELON's competition:
Message 12970152
FLSTF97 asks 1) What value is a value chain that is holding back deployment of your technology?
2) What level of security does Elon have that if it's bus is adopted that Elon will be able to profit from it?
chaz claims the potential consumer market is " far overblown"
And 100cfm writes:
I do however remain very skeptical about the whole smart house area. It seems every major consumer company is coming out with it's own network. Electrolux, Bosch, Microsoft to name a few. How will different appliances communicate with each other. It will not be practical to have to have all appliances from the same manufacturer. I would feel better if a few major CE companies adopted Lonworks as their standard.
But UncleWest is resolute, and paints this picture of an ELON world:
every existing home and building in the world as well as new construction is a potential customer for elon. in fact every lamp, tv, clock, appliance, hvac system, electric fence control, alarm system, anything electric is a potential elon customer.
the beauty of all of this is after one switches to smart house controls...a light switch and electric receptacle will still look and function the same for the consumer. but it will need elon's proprietery neuron chip inside and elon's server for full-function internet controllability.
ELON's supporters start coming out of the closet. DownSouth:
ELON's promise is in every phase of industrial physical plant, whether new construction or retrofitting older systems. Its value proposition is to reduce the cost of operating and maintaining mechanical systems. Its potential is to reduct the total cost of ownership of those systems by reducing fuel costs, reducing repair costs, reducing maintenance manpower costs, reducing spare parts inventory, and reducing the costs attributed to outages of those systems.
Forget consumer (home) applications. They are a different tornado entirely.
UncleWest now turns to stray challenges. He disposes of chaz's rejection of ELON's market potential.
this value chain has nothing to do with toasters. look at the lonmark product offerings here and please note the locations of the various companies...imo this is already a little bit bigger than it may seem.
echelon.com
and chaz relents: Oh, I see the point OK. ELON's value chain is certainly going to become significant, and they'll have a major impact in many areas.
6. That's All
That's the story up to now. ELON was up 36% on high volume today, and the eternal question of "does the market read the G & K thread" is asked. CBS MarketWatch quotes UncleWest in an article on ELON (http://cbs.marketwatch.com/archive/20000224/news/current/all_aboard.htx?source=blq/yhoo&dist=yhoo).
And the gorilla hunt continues.... |
