I am new to this thread, having recently "discovered" AWRD. Looks
like a great investment on the surface, but I am still mulling over
some of the things stated in AWRD's 10-Q filing with the SEC
late last year (http://sec.yahoo.com/3/97/11/13/awrd.html).
Please comment on the following direct quotes from the 10-Q.
Which of these are things to really worry about, as opposed to
the usual ass-covering risk statements in 10-Qs?
thanks, Bill
1. A number of computer manufacturers, including IBM Corporation
("IBM") and Compaq Computer Corporation ("Compaq"), develop their own BIOS products
to achieve compatibility with and integrate new technologies into their products. While the
Company believes that price and time-to-market pressures will continue to foster a trend
among its customers and potential customers to out-source system management software
requirements to third parties, there can be no assurance that this trend will continue or will not
reverse itself...
2. The Company believes that interdependencies may develop between system management
software companies and their customers, which would need to be overcome in order to
replace an entrenched competitor. While the Company believes that such entrenchment may
benefit the Company in its existing relationships with key participants in the desktop PC
market, customer entrenchment may make it more difficult for the Company to displace
entrenched competitors or increase market presence, particularly in the mobile PC market,
where competitors may already have strong relationships with certain mobile PC manufacturers. Intel has entered into formal agreements with, and has become a significant
shareholder in, Phoenix Technologies and SystemSoft. In addition, SystemSoft has entered
into agreements with Microsoft, IBM and Compaq to license its PC Card software.
3. Operating system software vendors may in the future enter the Company's primary markets as
direct competitors or incorporate enough features into their products so as to reduce the need
for the Company's products. Microsoft includes basic PC Card software in its Windows 95
operating system and has announced the inclusion of full PC Card software support in its next
generation Windows 98 and Windows NT operating systems. Microsoft's recently released
Windows CE 2.0 operating system includes Hardware Abstraction Layer (HAL) software
that incorporates system management software features and some PC Card capabilities. As
software developers provide greater functionality and features, user value and performance in
their products that eliminate or reduce the need for the Company's system management
software, the market for the Company's products could be materially diminished. In addition,
chipset manufacturers, including Intel, may increase their presence in the motherboard
manufacturing market, which may have an adverse effect on the Company's OEM customers.
There can be no assurance that other participants in the PC industry will not develop products
and solutions that reduce the demand or obviate the need for the Company's products.
4. The Company's future success is dependent on customer acceptance of new products and
penetration of markets outside the desktop PC market. There can be no assurance that the
Company will be able to expand its products and technologies into the mobile PC, embedded
device and network computing and Internet markets or that the Company will be able to
increase its market presence in the desktop PC market.......
In addition, there
can be no assurance that the introduction of Microsoft Windows CE into the embedded
device and Internet appliance market will not have a material impact on the Company's new
products for these markets. |
