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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Michael Burry who wrote (6239)	3/8/1999 8:12:00 AM
From: Wright Sullivan	Respond to of 78517

Mike- Thanks for posting the PSFT article link as well as your good "long post". My opinion is that the ERP uncertainty is not over, because newer technologies (thin clients, web-based interfaces) make it harder to charge immense fees for this software. In a 5-10 years, ERP should become as straightforward to use as QuickBooks Pro and Microsoft Office, reducing customization fees. SAP is indeed the gorilla in this sector, but they have not had to change their business model on the fly, and I am thus hesitant to put them anywhere near the MSFT/INTC category of survivor. It will be interesting to see who makes money in the next wave of ERP. I think the whole ERP sector is rapidly approaching a strategic inflection point, as Andy Grove might put it. The only company I own in this sector is Datastream Systems (DSTM), which I have posted on here in the past. I still like DSTM, but am wary of the entire sector due to the uncertain future outlook. -Wright

To: Michael Burry who wrote (6239)	3/8/1999 10:20:00 AM
From: Mike 2.0	Read Replies (2) \| Respond to of 78517

Michael, let me add myself to list of those who think you are dead on wrt PSFT. One wonders whether a put position on PSFT is not unreasonable now. Further, IMO those 2nd/3rd tier ERP firms that _do_ have the vertical competencies that PSFT lacks might be potential takeover candidates going forward. I have thought about possible "indirect plays" on ERP slowdown: First, what about Gartner Group (IT)? It's their job to interpret tech uncertainties such as these ERP developments for us right? Second, business intelligence stocks...companies may focus efforts on getting some useful info out of their ERP systems they have paid so dearly for. Two thoughts: Cognos (COGN) trading around 16x earnings on the face of it seems a good play but I need to do more DD. Also Hummingbird's (HUMC) recent acquisition of PCDocs has drawn analyst boos; at first blush I do see synergy. Cheers Mike