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Technology Stocks : General Magic

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To: hcirteg who wrote (4497)12/21/1998 1:52:00 PM
From: Drew Freeman  Read Replies (1) of 10081
 
Hi;

I just wanted to give my 2 cents worth on the NOC/service model vs. Technology Provider/Integrator debate. I am a big fan of the NOC model. A centralized, service-based infrastructure allows for new partners / customers to be quickly plugged into the Portico service. This provides for huge economies of scale. Sure, the initial infrastructure investment is massive in order to service the first customers. However, additional customers can be added at relatively little additional cost.

On the other hand, the 'technology provider' paradigm does not allow for huge economies of scale. In fact, each sale, each installation, and each set of customer service interfaces has associated costs that grow practically linearly with number of customers. This is why companies like SAP, BAAN, or I2 have armies of highly specialized SEs, sales people, and consultants running around the globe living out of suitcases. Not the type of thing I think GMGC wants to become involved in.

Happy holidays,

Drew
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