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To: Glenn D. Rudolph who wrote (117396)	2/11/2001 12:35:10 AM
From: GST	Read Replies (4) \| Respond to of 164684

Glenn: Your logic depends on one of two things: either the software for integrated scm from concept to customer can be "copied/developed" in-house by ARBA or else ARBA can acquire concept-to-customer scm capability by takeovers of other companies. The odds of either of these are low -- ARBA is just not in the integrated scm market now and entering this market will be very expensive and slow, given I2's lead. That is why i2 has such stunning growth prospects -- they are practically alone in this space. As for ARBA, their core market is a low barrier, low-value-added, non critical aspect of the business -- close to maturity and not the kind of mission critical applications which command customer loyalty and stable margins. While ARBA is conservatively managed and solid in the presentation of their financials, it will have to leverage its balance sheet from now on by buying up other companies at substantial premiums to the market if it is to have any hope of entering the scm market -- the risks are substantial and they have too much ground to catch up IMO. I2 can very easily round out its product offerings by picking up the kind of commodity software capability of ARBA -- technically not very difficult and pretty simple to buy in the market in comparison to ARBA's far more difficult task of filling a huge proprietary software development gap. ARBA is simply in the wrong market -- the costs of entering the integrated scm market and the odds against its success make it a distant second choice as an investment compared to I2 IMO. I2 could be among the best stocks to invest in -- but ARBA is likely to be something between a poor second-tier player and flat-out dead money.