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Technology Stocks : USinternetworking , USIX -- Ignore unavailable to you. Want to Upgrade?

To: lazarre who wrote (462)	8/14/2000 6:10:51 PM
From: Sun Tzu	Respond to of 605

Right. And I agree that this is the best marketing angle that USIX can take on the issue. But the other companies have huge "consulting" and sales departments. They are not just hardware or software companies. They can create whatever software they can market and make aliances for whatever they cannot. IBM could easily set up a data center with all the suites of applications they have and then include other software if the customer insists on it. The amount of money they would make just from the consulting fees for application set up would be incentive enough. Not to mention they'd get to sell a lot of their boxes in the process. Andersen Consulting would be another big competitor, if they chose to. For those who don't know, the kinds of applications that USIX and Oracle are targeting, are complex enough that they sometimes take over a year just to configure. And each configuration is specific to each client. The challenge to USIX is to achieve the critical mass before these guys jump in. I am not so sure about this because they are not financially as strong I'd like them to be. They have too high a debt to equity ratio and they only have enough cash to last another 5 quarters (I'd want cash reserves of 8-12 quarters and D/E of less than 0.6). So they really need strong stock price to flourish. But the stock price will remain shaky so long as such concerns remain -- typical catch-22. Sun Tzu PS Rupert thanks for the good article on concept stocks.