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Technology Stocks : Ariba Technologies (Nasdaq-ARBA) -- Ignore unavailable to you. Want to Upgrade?

To: Lizzie Tudor who wrote (489)	11/10/1999 1:25:00 PM
From: MulhollandDrive	Read Replies (1) \| Respond to of 2110

Lizzie, That caught my eye too. I'd like to understand if this is a differentiation for ARBA over other competitors. Looks like the market may think so<g> bp

To: Lizzie Tudor who wrote (489)	11/10/1999 10:53:00 PM
From: HRM	Respond to of 2110

Over time, Ariba may build a very attractive transaction-based revenue model. Is this new? Anybody know? Discussed in the conference call - here is the relevant part of the transcript and link. Jim Moore: Hey. Congratulations on a great quarter and a great year and your third-year anniversary. I wanted to ask you if you could just give a little bit more detail on the transaction revenue components to the revenue stream. If you could talk a little bit about the make-up of that and, you know, sort of - what do the contracts look like? How do you structure that vis-…-vis sort of a traditional enterprise software contracts? Keith Krach (?): Yeah. That's a good question, (Jim). It really - the biggest core element of it is that what our customer base purchases is transaction volume. They buy perpetual right to execute a number of transactions, and then they have that right every year. So it's really a value-based type of pricing. If you compare that to the old kind of client/server type of model, that's more (seat) based. And, you know, when you become effective, you're basically purchasing more (seats). You know, in our case, they're buying the capacity that they're going to use as they grow the organization, and they are expanding the amount of capacity than they need. So it's really transaction based. So and that's the biggest differentiater. Do you want to hear a little bit more about the details of that piece of our revenue? Jim Moore: Yeah, if you could. You know, what kinds of things are you putting into the contract, and how is it structured? I don't know if you can quantify it or not. Keith Krach (?): Well, the basic element of how it is structured is a customer will purchase the transactions up front and they'll pay for it up front. So, in that sense, they are licensing that volume transaction and (INAUDIBLE). it's really - typically if the majority is hovering in the range of 75 to 80 percent, the transaction pieces it, and the other 25 to 20 percent of it is things such as maintenance and modules. Jim Moore: O.K. And just to be clear again, this is sort of a per-line-item charge versus any - you're not taking a piece of any transactions going across the network at this point? Keith Krach (?): No. That's a per-line-item charge. vcall.com