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To: Amy J who wrote (174197)	4/21/2003 8:29:04 PM
From: Lizzie Tudor	Respond to of 186894

Here is the article. After reading it further, it really looks like another self-serving Larryism. It may be true that the enterprise software sector is maturing. After all there were hundreds of companies out there doing b2b alone and that group all but disappeared and rolled back into SAP, Oracle etc. But internet technology can't be mature after just a few years, come on. My problem with Larry, is that of all the major technology companies, Oracle is the worst corporate citizen imo. Oracle's Ellison: 1,000 Tech Firms Should Go Bankrupt Tuesday April 1, 3:45 pm ET By Peter Loftus, Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Just call Larry Ellison (News) the dark oracle of Silicon Valley. Ellison, the founder and chief executive of software giant Oracle Corp. , says the high-technology industry must undergo a sweeping consolidation that will spell the end for many of his rivals. "We think there's at least 1,000 Silicon Valley companies that need to go bankrupt," Ellison said during a meeting here Tuesday with reporters and editors from The Wall Street Journal and Dow Jones Newswires. Not surprisingly, the hard-charging billionaire predicted Oracle, of Redwood Shores, Calif., would be among the survivors. Ellison's other survivors included several big-name tech firms like Microsoft Corp. (NasdaqNM:MSFT - News) and International Business Machines Corp. (NYSE:IBM - News) . (Both IBM and Microsoft are heated rivals of Oracle's, so Ellison doesn't go out of his way to say nice things about them.) Further consolidation will occur because there are too many tech firms based on a single product, Ellison said. As technology products become commodities and prices fall, these smaller firms won't be able to compete independently. He asserted that nearly all software profits were at five companies, including Oracle, out of hundreds in the sector. The industry is maturing, yet many in Silicon Valley are in denial and haven't embraced efficient models of operation, he said. "The whole model doesn't make sense," he said. "There's a bizarre belief that we'll be young forever." Ellison acknowledged that Oracle itself faces challenges, three years into a tech-sector downturn. The company, which specializes in database software, had strong sales in December and January, but February was weaker. Now, "our customers are being cautious on capital spending," Ellison said, especially in light of the U.S. invasion of Iraq. Oracle's fiscal fourth quarter ends in May; Ellison didn't offer an update on the company's financial targets. Separately, Ellison reiterated the company's position that it would consider paying cash dividends to shareholders if dividend taxes were eliminated, as proposed by President George W. Bush. "We'll start paying dividends when they stop taxing them," he said. Meantime, the cash-rich company will continue to repurchase its shares as a way to boost shareholder value, he said. Ellison also complained that Wall Street has focused too heavily on recent declines in the company's revenue from new software licenses. He said investors overlooked the fact that the company's revenue from license renewals by existing customers is on the rise. "What people don't understand is that we are a subscription-based business," he said. -Peter Loftus; Dow Jones Newswires; 201-938-5267; peter.loftus@dowjones.com biz.yahoo.com

To: Amy J who wrote (174197)	4/22/2003 2:20:54 AM
From: hueyone	Respond to of 186894

Five month old article, but still relevant imo. The Undead Victoria Murphy Quentin Hardy, Forbes 11.11.02 forbes.com Snips: No wonder tech customers are in hiding. They are under assault from hordes of software companies that don't even deserve to exist. It's time for a shakeout--but who will do the shaking? The software business should be a field of corpses by now, buried by a long downturn in business spending; the David Guzmáns of the world should be free to choose from the thinning ranks of healthy, relevant survivors. Yet two years into the biggest bust in high-tech history, an estimated 10,000 public and private software companies are still in business. They all want a piece of a shrinking pie. Software spending is in decline after years of fervid growth, down 6% this year, to $75 billion globally, according to Meta Group, a research outfit. In some ways, venture capitalists have only themselves to blame. In the boom, VCs poured at least $47 billion into software startups, according to VentureOne, fueling some 226 public offerings. Each debut promised untold improvements in corporate efficiency. In fact, many of these companies never came near profitability, even in good times. The boundless sectors they occupied now look more like crowded niches, with multiple companies fighting for a slice of such marginal fields as storage management, content management or collaboration management. It isn't clear that the backers have learned anything. With 771 venture firms investing in technology in the past six months and $100 billion uninvested cash remaining, many more software companies will likely head into the marketplace. Software companies continue to soak up 20% of venture funding, just as they did in the boom years that created this glut. Regards, Huey

To: Amy J who wrote (174197)	6/14/2003 2:17:32 PM
From: hueyone	Read Replies (3) \| Respond to of 186894

You know, there are huge advantages to being private - check out Bechtel - they generate billions in revenue -- all under the confidential protective covers of a private company. I suspect some Silicon Valley companies couldn't make it as privately held companies. After all, they would have to give up the massive transfers of wealth from outside shareholders that are subsidizing operations. Managing and funding a company from actual operations as opposed to relying on public equity financing to subsidize operations would be an entirely new experience for some Silicon Valley managers---Tom Siebel for example. I think SEBL would have been long gone were it not for the public markets and outside shareholders sucked in by hype and overstated profitability. JMO, Huey