WIND has responded to perennial complaints by investors by cranking out needed press releases, surely to everyone’s delight except those idiots that must have thought the stock was in for another follow-the-pattern fall after jumping to $50 following entry to the S&P 400. Short interest increased 67% in September, which must now be providing added fuel for recent advances.
But the main catalyst for the strength in WIND stock price is the press releases themselves, and some much more than others.
For example, the TMS 2.0 release excites me because the new product extends to Layer 3, and this opens the door for an enormous amount of network intelligence, virtually a difference in kind. A complete set of Layer 3 network software tools obviously is a major reason why WIND has been anointed by every player in the raging intelligent network processor space.
Does the Street see this?
I thought that the release was crafted very well, people are starting to get the message that Networking is being "commoditized" in a similar fashion to how the PC was commoditized (i.e. a chip maker and a software provider). At least that's how I see it.
Would you agree with this Allen?
I got this email yesterday from a buy-side analyst for a $1.5 Billion fund. The fund has been happily building up its position in WIND from the recent low $30s. The good news is some analysts really can get the picture, and are prepared to put their money where their brains are. BTW, I don’t have to tell you how I responded to his question.
Today’s Tornado for I2O 2.0 release is what I have been waiting for for months. Please try to understand how big this is. An off-loaded TCP/IP stack is what the data-swamped IT community needs. That the offload is both intelligent and based on the open I2O spec is awesome. This opens the door for a Lego Block approach to scaling servers through appliance-like add-ons. Imagine a Linux box with a multi-port, off-loaded NIC also housing I2O-based RAID (iRAID). This appliance could live life as a network storage beast capable of handling Gigabit LAN speeds extremely reliably, at a fraction of the cost of existing network storage solutions. It could be a screaming web server. Or, it could open up whole new categories of appliances. The device could intelligently store, compress, decompress, encrypt, perform intrusion detection, all on the fly without bothering the host Linux system – through vertical applications running on the I/O devices.
It’s the peer-to-peer possibilities (in which any two I/O peripherals essentially can talk directly together without bothering the host CPU) that excites me as much as anything. This leads to my Lego Block analogy. For example, add an IXP 1200 network processor (which is I2O compliant) to the intelligent, multi-ported NIC and you end up with a $40,000 switch for peanuts.
We won't have to wait long for these technologically disruptive products to hit the street. Intel's slowing PC-based business must be providing all the impetus needed to get I2O building blocks and complete products to market fast.
If the buy-side analyst thought TMS 2.0 alone would commoditize the network equipment space, what will he think when he realizes what it means when these technologies work together. I can't wait to tell him.
Allen |
