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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Apollo who wrote (36753)	12/18/2000 3:33:52 PM
From: Mike Buckley	Read Replies (2) \| Respond to of 54805

About PSFT and CTXS on the W&W list ... I don't remember why PSFT is on the list. It is the Gorilla of human resources software market that is well past its tornado. PeopleSoft is also a chimp in the ERP sector. I'm not sure what we were watching or waiting for. It's still appropriate that CTXS remain on the list if people don't mind watching and waiting a really long time, maybe forever. After having many years of sequential revenue growth that never achieved tornado speeds, the company had declining revenue (not just declining growth). Each of the quarters in June and September had less revenue than either quarter ending in December or March. That combined with not having had a CEO for six months makes it look like an unshiny pebble with some rough edges at the moment. --Mike Buckley

To: Apollo who wrote (36753)	12/18/2000 4:39:11 PM
From: Jim A.	Read Replies (1) \| Respond to of 54805

Apollo, I think adjustments to the Watch and Wait list is a good idea. However, being that SDLI will be absorbed into our King JDSU in January(if all goes well), they should not be added. Jim

To: Apollo who wrote (36753)	12/18/2000 5:13:09 PM
From: LindyBill	Read Replies (2) \| Respond to of 54805

Should any be added? Brocade? I like brocade, own it, and wonder what the hell happened to it today! It will never be a Gorilla or King. A prince of the storage sector?

To: Apollo who wrote (36753)	12/18/2000 10:56:39 PM
From: JRH	Read Replies (4) \| Respond to of 54805

Apollo: Yes, the W&W definitely needs to be revised. Last year we discussed possible changes of venue for the portfolio and I will again make the proposition: I propose that the W&W be used to track: 1.) Potential Gorillas 2.) Potential Kings 3.) Gorillas and Kings that do not qualify for the GKI (based on the thread's-holdings criteria) I am very open to other ideas and comments from the thread... Justin

To: Apollo who wrote (36753)	12/19/2000 5:26:12 AM
From: Bruce Brown	Respond to of 54805

Apollo wrote: Justin's Watch & Wait Portfolio.......time to revise Open question to the thread; is it time to revise the W & W Portfolio? Last year, I think Justin added to the list, but I don't recall if any were deleted. I would certainly think the W&W Portfolio could use some input from all of us. Looking thru the list, there are some that we don't spend hardly any time on, and in which very few in the Portfolio Survey were actually invested. Examples: ARMHY, PSFT, OPWV, RNWK, CTXS, Should these be deleted? Although Mike has already mentioned it, I would also make the case that PeopleSoft is certainly beyond watching and waiting in the HR space. Ditto for i2 in the SCM space. No need to mention that these two companies are smack in the middle of the network application of the Web architecture TALC as well. Other important companies in that broader 'web architecture' include Siebel, BEA Systems and Oracle. None of these are companies that have less than $712K trailing 12 month revenues. Those are BEA System's TTM revenues by the way which will bump up even higher come the end of January and their Q4 closes out. If you want to put each of those companies into the TALC and use the guidelines of the manual in terms of when one should buy application software vendors, I find it hard to make a case that any of them belong in the Watch and Wait category at this point in time. However, knowing that the G&K index is based on top holdings of thread members and many of the companies that do not make that index certainly should be 'watched' somewhere - I guess the W&W portfolio is as good a place as any. With that in mind, expanding the number 'watched' might be a worthy move just for the sake of having things all listed together. Obviously, many of us watch and invest in some of these companies while we wait for others. If one really wanted to use the TALC criteria of choosing candidates for the Watch and Wait Portfolio, then in the application space some more appropriate companies from various segments of the business to business application/solutions broad market with smaller revenue bases to date like Broadvision, Ariba, CommerceOne, etc... might be more appropriate for W&W. Should any be added? Brocade? SDLI? GLW? Avanax? Juniper, RBAK? If you want to base it on market share of each core niche and the revenue growth rates climbing up and approaching $500 Million to $1+ Billion, then companies like Juniper, Redback, Brocade, Ciena, BEA Systems, Veritas, Verisign and Checkpoint certainly would be appropriate additions to cover more of the games going on in the Web architecture of computing. There are others as well (Sycamore, Extreme, Foundry, Avici, ONI Systems, Corvis, etc...), but they don't have as large a revenue base to date as the others. I would imagine that many of those would make a nice balance to the smaller revenue based companies like Avanex, Cree, Rambus, Echelon, Arm Holdings and Openwave Systems. I think that since JDS Uniphase is finishing the acquisition of SDLI in December or January, I don't see a reason for their addition. I guess if we're "watching and waiting" on a Nortel, we could toss in Corning as well. Kind of odd to be watching and waiting on a company that will come in with about $30 Billion in revenues this fiscal year while the other comes in around $7 Billion. After all that was said, I would certainly vote that some type of addition or vote or rebalance might be appropriate if everyone was interested in tracking the smaller and mid sized up and coming companies in various niche markets. Then again, my vote is biased because I have a lot of money invested in the Web architecture companies (both software and hardware) listed above. BB