Candle Stick, I think that there are major differences between ASTN and AMZN of two years ago. The first is that AMZN was very well financed and could support the brand development plan they had. The second is that AMZN had developed a history of relatively flawless execution (I think that their last quarterly, however, is showing deviation, with SG&A rate of growth far exceeding growth of revenues, an accident waiting to happen, finally). ASTN, as you said yourself spent 5 years in developing a system which is capitalized at less than $500,000, it seems they spent either too little, or took too long to spend it (regulatory affairs were not on their side either, but that is the turf on which they are playing).
You may say that ASTN is a pioneer, but in my book, pioneers often end up with arrows in their backs. If you followed the AMXN marketing model of brand recognition buildup, you would require resources which they do not have. There are also big difference between the AMZN business model and ASTN model, AMZN pioneered the brickless retail environment and two years ago had barley any competition, ASTN is just another electronic trading system and has not erected barriers to competitive entry. It would be nothing for the NYSE to spend $3 MM in developing a competing software (mind you I use 6 times as much as ASTN spent, since of course, the mammoth NYSE is not going to be as efficient as ASTN). If ASTN can use the open time window to establish strong market presence, they may survive, but being valued at $3.3 billions, that will take some time, IMHO.
Zeev |
