I don't buy MSFT for the same reason I wouldn't buy tobacco or HMO stocks. It's not worth the 30 pieces of silver I would make.
wonderful investment strategy. oh yeah, if you use don't then you should also use don't in the second instance instead of wouldn't. However I do not recommend the use of don't at all.
Main Entry: 1don't
Pronunciation: 'dOnt
Date: 1639
1 : do not
2 : does not
usage Don't is the earliest attested contraction of does not and until about 1900 was the standard spoken form in the U.S. (it survived as spoken standard longer in British English). Dialect surveys find it more common in the speech of the less educated than in that of the educated; in those places (as the Midland and southern Atlantic seaboard regions) where it has lasted in educated speech, it is most common with older informants. Surveys of attitudes toward usage show it more widely disapproved in 1971 than it had been 40 years earlier. Its chief use in edited prose is in fiction for purposes of characterization. It is sometimes used consciously, like ain't, to gain an informal effect.
Red Hat shares may be poised to fall as novelty wears off
By Bloomberg News
Special to CNET News.com
August 22, 1999, 4:30 p.m. PT
DURHAM, North Carolina--Shares of Red Hat, which is betting it can popularize a free computer operating system that competes with Microsoft's Windows, could tumble in the next few months as the novelty of the first public Linux company wears off, analysts said.
Since the company first sold shares to the public on August 11, its stock has more than quadrupled, giving the company a market value of $4.55 billion. Friday, shares fell 3.19 to 68.13. Red Hat is the first company to go public that sells a commercial version of Linux, a free operating system that's used to run powerful corporate computers, or servers.
While Microsoft executives said in an internal memo late last year that Linux is a significant revenue threat to its Windows NT operating system, Red Hat is unlikely to pose a threat to the world's largest software maker, analysts say. That's because anyone can download Linux free from the Internet rather than paying Red Hat. Dozens of rivals such as Caldera Systems and TurboLinux are also muscling in on the action.
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"Linux's growth and popularity does not translate into popularity for Red Hat," said Matthew Nordan, an analyst at Forrester Research, a Cambridge, Massachusetts-based technology research company.
Small market
Linux was the fastest-growing server system last year, when the Durham, North Carolina-based company had about 56 percent of commercial Linux shipments.
Those figures don't translate into a lot of revenue for Red Hat, however. The money-losing company had revenue of $10.8 million for its last fiscal year.
"I think we'll probably see people stop and assess [whether] Red Hat [can] produce the revenue that's expected for a company of that size," said Dan Kusnetzky of market researcher International Data Corporation.
Red Hat declined to comment.
Even though Linux use is growing quickly, the commercial market is still fairly small, according to IDC's figures.
Linux revenue for servers and personal computers was $35 million last year, according to IDC. That compares to $2.5 billion for Unix-based software.
Understating the numbers?
Linux supporters argue that IDC's numbers are too low.
"They vastly understate the Linux numbers," said Larry Augustin, chief executive of VA Linux Systems, which makes hardware that runs Linux and who says his company is looking into an initial public offering. Still, he said, "It's really tough to get good data for Linux."
Linux was created 1991 by Linus Torvalds, then a student at the University of Helsinki, Finland, as open-source software. That means that anyone can download it from the Internet and tailor the program to their needs. That also makes Linux usage difficult to track.
The program has gained thousands of impassioned adherents among programmers, students and scientists. Linux zealots believe that open software codes promote innovation and allow people to choose which Linux variations are best. Linux is also a more stable computer program than Microsoft's Windows NT, say analysts and programmers.
Eye on Wall Street
"When you're dealing with Linux, you're dealing with a counterculture," said Rob Malda, founder of Slashdot.org, a Web site that's a top outlet for Linux news. "Most of the community realizes Red Hat is between a rock and a hard place: They have to release the code for free, but they have to make Wall Street happy."
Open-source software can't be licensed, unlike software programs sold by Microsoft and others. That poses a risk to Red Hat because a company can purchase one Red Hat Linux program and copy it onto every computer it owns.
"If you just replicate Microsoft's software, that's called software piracy," said IDC's Kusnetzky. "If you replicate Red Hat's software, you're doing just the right thing in the Linux community."
Red Hat is able to sell the free program by adding technical support and making the software easier to install on computers. Still, because Red Hat can't license the software, it allows people to download it for free from its Web site.
Red Hat plans to expand its Linux-based services, which accounted for 7.2 percent of its sales for the fiscal year. Red Hat's strategy is to boost its revenue by using the software to sell more services, such as installing the program or tailoring it for companies, analysts said.
"They expect over time technical support to be a larger total chunk of revenue," said Forrester's Nordan. "To me that's bad, because these companies have much worse margins than those in software sales."
Red Hat has one- or two-year joint marketing agreements with several top technology companies including IBM and Compaq Computer. Those agreements may be at risk if Linux gains more popularity, said analysts.
"The big challenge for these start-up companies is the major systems vendors (such as IBM and Compaq) are going to get into those services, too," said Dwight Davis, an analyst at Summit Strategies. "They have staffs, worldwide reputations. I'm not really optimistic about other startups in this space."
Backlash is possible
Red Hat's success may imperil the company's relationship with the programmers who work on the program and maintain the source code.
"The Linux community has a schizophrenic attitude," said IDC's Kusnetzky. "They want to see Linux used broadly, but on the other hand they don't want anybody to make money on it because it's open source and free."
One of Red Hat's strengths today is its brand name. That reputation could be tarnished if Linux programmers decide that Red Hat is becoming too much like Microsoft in trying to dominate the Linux market.
"People want to see more multiple vendors out there," said VA Linux System's Augustin. "That's the whole appeal of Linux." |
