To all: a negative piece on TSRI from www.thestreet.com
by someone called Cory Johnson.
Mr or Ms Johnson has written some other mostly sensible pieces on the magnitude of y2k at the same site (and an adoring puff piece on DDIM).
Is this the thread that has "affectionate blather"? I don't think so, its like a graveyard here. Now the PLAT thread, maybe...
TSR: A Closer Look at the Company's Y2K 'Fix'
July 17, 1997
By Cory Johnson
Staff Reporter
It's just a small-cap fantasy.
Here's another Year 2000 company with a share price foaming at the mouth -- up 360% in the last six months. Just another Y2K company that can issue a press release -- a press release -- that drives the stock up 87% in five days. Just another Y2K company surrounded by affectionate blathering on the Motley Fool and Silicon Investor.
As for fantasy? Well at least this Y2K company has something the others crave: strong revenue and steadily growing earnings. Toss in an announcement about an incredibly cheap Y2K solution and you have a most exciting fantasy.
Long Island-based TSR Inc. (TSRI:Nasdaq) seems like a dream come true. On July 9 the company announced "Catch/21," a software program that boasts a Y2K fix that will cost 25 cents per line of code, and that sent the stock through the roof in a speculative fury. Right now industry analysts like Stephanie Moore of the Giga Information Group say fixes will cost at least $1.50 per line of code.
Few now dispute the frightening prospects of the potential for a Y2K crisis, a problem that will afflict the world's computers after Dec. 31, 1999. Since mostly all computers and software computer dates use two digits, the year 2000 will be recognized as the year "1900," or "delete file," or "no record," or "cue up the artist-formerly-known-as-Prince record," or God knows what. So information technology departments of every major corporation, bank and government agency are all facing up to the fact that they'll have to go in, examine and possibly change every line of computer code that their organization uses.
"As companies start to look into their code," says Tactical Strategy Group Y2K expert William Ulrich, "they're finding this problem is a lot bigger than they imagined. Million-dollar budgets for Y2K fixes are quickly exploding to 5 and 10 million."
The Gartner Group (GART:Nasdaq) has estimated that U.S. Y2K fixes could cost up to $600 million, and is reportedly about to up that estimate.
But can TSR really fix the problem? At closer glance, it's clear that most of the company's revenue does not come from Year 2000 work. Even the Catch/21 press release, which cited eight companies "using the Catch/21 solution," had to be sheepishly amended two days later. In a July 11 release, the company said: "In a July 9 press release issued by TSR Inc. regarding its solution for Year 2000 Compliance, three prospects were inadvertently included with those companies already using TSR's Catch/21. According to Joseph Hughes, TSR chief executive officer, United HealthCare, FISERV and LILCO are presently reviewing Catch/21."
Oops.
The company did not return calls for comment, but Moore, of the Giga Information Group, says that's not all they don't return. "I think their returns on the stock market will be short-lived," she says. "They're making a lot of money on the stock market talking about this 25 cents per line of code, but it isn't really such a big deal."
Moore explains that Catch/21 is a "windowing approach." Windowing is a Y2K quick-fix method that lets a computer effectively guess on dates. So if the date is, say, 03/08/67, the computer might guess that "67" means "March 8, 1967." But if the date is 03/08/11, the computer will guess that it means "March 8, 2011." The window determines whether you're inside or outside the 21st century. That is an effective quick fix for some number fields, but obviously, not a complete fix (and try explaining that to your 89-year-old grandmother in the year 2000 when she stops getting her Social Security check because the computer thinks she hasn't been born yet). "This tool is nothing revolutionary," says Moore. "They say it's not windowing, but rather a 'sliding window.' But it's really the same thing."
There are plenty of other windowing tools already in use from vendors that offer more than just windowing. "I do not see TSR in this Year 2000 market now or almost ever," says Moore. "From what I can tell they have very few clients. Twenty-five cents for that kind of approach is also not earth-shatteringly cheap because it doesn't include analysis, and it doesn't include testing, which is more than 50% of the effort. So when you see 25 cents and you compare that to $1.50 per line of code, 25 cents is just a tiny piece of what has to happen to that code to get it back into production and tested, etc., etc."
Ulrich, who consults with thousands of information technology managers, also says that TSR has seen little to no penetration into the Y2K market. "Where the hell have these guys been if they've got a great product?" says Ulrich, who says a partial solution isn't much of a solution at all. "Why is Wall Street getting so excited about this? It beats me." |
