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Technology Stocks : EMC How high can it go? -- Ignore unavailable to you. Want to Upgrade?

To: JRI who wrote (10818)	8/2/2000 2:42:29 PM
From: JRI	Read Replies (2) \| Respond to of 17183

Ruettgers on CNBC with Maria: Says he expects storage market to grow by 2 1/2 times by 2005....(I assume he means revenue pie)....Says he sees EMC's leadership extending for at least 5 more years (hard to see beyond that, he says)...that he continues to see EMC increasing its lead on its competitors (which, again, I assume, means that EMC can/should increase market share)...

To: JRI who wrote (10818)	8/2/2000 10:37:56 PM
From: Gus	Respond to of 17183

if EMC reaches 12B in sales (past 4 quarters) by Jan. 1, 2002....what will the market cap be (at that point)? At the $12 billion revenue milestone, EMC Software will be approaching $2 billion in revenues. Based on the $350 million in sales posted in the most recent quarter, EMC Software is already at a $1.4 billion annual run rate with 6 quarters to go before their self-imposed deadline. 3 of the last 4 EMC acquisitions have been small specialized software companies that reflect their agnosticism towards protocols and topologies. 80% of its $1.5 billion R&D budget for 2000 and 2001 is software-related. The alliances with Nortel, Lucent and Cisco indicate continued base system interoperability with the metro optical networks of the future and that necessarily means that EMC's central storage management software like ControlCenter and EMC services will be designed into the carrier-class (99.99999% reliability) and enterprise-class (99.999% reliability) central network management software of the optical networking leaders. In terms of applications, EMC has a broad relationship with Microsoft and Oracle, the two largest software developers in the world, and an always contentious one with IBM. This article on Oracle captures one key IT trend involving reference platforms. Browsing the Reference Section Oracle's new strategy includes the first public price list ever offered, in December, and co-selling product with hardware and software vendors that compliment Oracle's database and application server products. It appears to be working, as revenue is up and costs are falling. At the base of the new strategy is a twist on the old saw, "No one ever got fired for buying Big Blue (or lately, Microsoft)." In this case, though, the new phrase is "No one ever got fired for buying the reference platform." A reference platform is a collection of technologies -- each best of breed -- that solves an overarching information-technology challenge. For the Global 2000, the heart of the tech marketplace, the reference platform for in-house data management, customer-relationship management and e-commerce Web sites includes Oracle. Building a Joint-Sales Channel Oracle has forged on-going relationships with other companies that represent IT core competencies. "We have a one-to-one customer match with Cisco and almost one-to-one match with EMC," Michael Rocha, senior vice president of Oracle's Platform Technologies Division. The companies now co-sell their products and, through a joint-escalation and support center. In other words, the three companies share marketing expenses and support costs. Oracle's sales and marketing expenses have decreased as a percentage of revenue from 38.3% for the nine months ending in February 1999, to 32.8% in the nine months ending February 2000. Meanwhile, license revenue is soaring 30% over the last third quarter of fiscal 2000. biz.yahoo.com What will the market pay for the shares of a company with a demonstrable technology advantage that shows up in consistent 30-40% annual revenue growth and 50-60% annual earnings growth? Who really knows? All I need to know is that very, very few companies with over $10 billion in sales will be showing that kind of growth.