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BTK: A buy-out still seems reasonable...
by somebody. There is no way, in my opinion, this company even approximates break-even next year. The powers-that-be (mainly MSFT) are going to string out the TCG initiative until they have their ducks in a row. WAVE has virtually zero chance of snagging the "premium services" revenue stream, which I seriously doubt will even begin to happen before 2005 in any material way.
My Wave-as-a-pawn-in-the-Intel/MSFT-struggle hypothesis seems more credible than ever.
I expect, though, that the family will research the many ways to enrich themselves first, certain employees second, and shareholders a distant third, very thoroughly. A shareholder screwing, should one happen, will of course be entirely legal.
Mbldug: In the first place...
I am not a former employee. In fact, I've never met a Sprague. Nor have I been to Lee, Massachusetts. I've never even met a Wavoid, for that matter! Except for the guy who buzzes my house in the black helicopter and my exchanges with him are limited to hand signals.
In the second place, I am fairly particular in my allegations. I have never accused the company or any of its employees of illegal acts, for instance. I do believe they would screw the Wavoids in a New York minute, frankly, if it benefitted some third cousin in Hoboken, but I'm certain they would do so entirely legally.
No, my complaints are essentially this:
1. The family is extremely greedy and routinely place their own interests in front of the shareholders. (See Founders Shares.)
2. Certain family members are incompetent and, without benefit of the family name would never have qualified for their positions. (Michael Sprague being Exhibit B.)
3. The ownership of the stock is concentrated in the hands of shareholders who are so enamored of the theory of the company's products that they are almost without any practical sense at all. A cult, if you will.
Actually, I suffer no illusions about the anonymity of message boards. Clearly there is the ability to subpoena identities in the case of wrongdoing. That is as it should be. There is a difference between criticism and libel (or slander), however. I think the post to which I respond fails to recognize the difference.
TAMPA: Too late...
I already e-mailed a bunch of those rotten communists and told them that WAVE will bury them! (In the Kruschevian sense, of course.)
Lucky: MSFT will not buy WAVE...
because they will be able to duplicate the entire WAVE store of intellectual property in-house by the time the world is ready to move ahead to some version of Trusted Computing. There is no way these folks allow the "premium services" revenue stream to fall into WAVE's hands. No way. Of course, not being a patent attorney, I can't opine on the legal obstacles preventing them from doing so, but my guess is that the WAVX patents are becoming less protective as the revenue model morphs into operating systems, TANs, etc.
That concludes my three post allotment for today. Thank you, Matt, for generously allowing me a limited dose of free speech daily. And now the conversation can return to those vital issues--like whether Michael Sprague can even find his toothbrush in the morning.
P.S. to alea: Wavexpress mainly serves as a legal way to funnel more money to family members.
eamon: you are correct...
except that all those other firms are willing to give guidance on revenues, gross margins, profits, etc. This company, being owned by a remarkably docile group of investors, can get by with vague guidelines, winks, nods, back-room e-mail assurances, and the like. Please do not equate this management's forthrightness with any of the more conventional technology firms.
BTK/Alea: If I were the CFO of Amazon...
or e-bay (or the person holding the purse strings, whoever that might be), I would ask the sales rep trying to sell me Trusted Computing if they have fully implemented it at their own firm, whether that be HP or IBM or Sun or whoever. If the OEM doesn't use it for its own internal systems, I would be hesitant to serve as guinea pig.
If it weren't for amateur management...
it might be reasonable to gamble a bit on this company's chances. But I suspect VISA/MC was able to outmaneuver WAVE in the FINREAD corridors and I believe MSFT is equally adept at that sort of game and has even more incentive to play it. No. WAVE is a pawn in an ongoing INTEL/MSFT contest. The pawn, when no longer useful, will be allowed to perish. Of course, it's possible that I could be wrong.
That concludes my three post per day limit. Thanks to Matt, I-Hub board monitor, for allowing me to express an occasional opinion.
Alea: There's no denying...
that some sort of demand exists for "Secure" computing. Of the 4 million TPM-type PCs in the market, though, how many are in the enterprise segment? And what incremental cost is involved in those PCs? Very little.
My guess is that the powers-that-be (MSFT/INTEL) are busy carving up the "premium services" pie behind closed doors. Whilst they haggle, they take turns beating each other over the head with WAVE-based alternative solutions. But in the end they are not going to hand the revenue stream over to Sprague and Company. They will strike a bargain, eventually, and then they will let WAVX drift into oblivion. But, of course, I could be wrong.
Allman: Quoting IT managers and consultants...
like Accenture people merely illustrates there are those who would like to advance the secure-computing game. Both the IT manager and the outside consultant have something to gain by hawking that position. The decision-makers, however, are going to look at the all-inclusive cost. And I predict that they are going to turn thumbs-down. For now, anyway. Eventually things may change. I expect just about the time when MSFT has co-opted WAVX and has its own suite of "premium services" to offer. You don't think the world is going to hand thirty to forty bucks per annum per PC to WAVE, do you?
eamon: Wishful thinking...
The OEMs are attempting to create demand for so-called security where there is none. The fact that all the technology suppliers jump up and down singing the praises of the TCG World Order does not mean it will happen. I don't think there's a compelling case to be made to the enterprise. Perhaps I will be wrong, though. Perhaps not.
Weby: btk enjoys a good row...
it's unfortunate that no one has been able to give him one.
Here's a prediction: TPMs go nowhere. The whole movement fails due to lack of enterprise interest. Remember, you heard it here first!
BOUNTY: Steven has the Equestrian Center...
to fund, you know. He endeavors to provide the ultimate in dining experiences for his equine guests. Unquestionably the vast majority of his stock proceeds have been funneled back into charitable interests such as these. There is not a greedy bone in his body, I'm quite sure.
Doma: Your $250 million revenue scenario is ludicrous...
given that the end user is targeted to be the enterprise. One million TPMs per month would require a tremendous number of entities effectively junking their entire PC inventories overnight. I'm curious what sort of company would choose to be the first to take such a radical step and what you imagine their decision process might be.
24601: Why no Form 144 from Peter Sprague?
Is he no longer considered an insider? If so, by what tortured logic is this determined?
P.S. to Alea: You are completely correct in your response to my "long odds" message. I think we merely derive a different set of probabilities, but the methodology is the same.
Is that two hundred fifty million DOLLARS?
that Wavoids are casually tossing around as a plausible revenue stream? Or are we talking in terms of yen? Or maybe piastres? I'm sorry, but this sort of projection makes about as much sense as the Donald Duck contest of a few years back. Remember that? The one in which 99.9% of Wavoids predicted a stock price approaching $187 per share by, well, by some time that is now in the past? I said it then and I will say it now: Utter insanity. And this time, no, I couldn't be wrong.
Someone enlighten me...
with regard to the end-user of this product. Paint me a picture of the decision process the first enterprise uses to decide to opt for a TCG-sanctioned Trusted Computer System. Is it a piecemeal implementation or must it be all-or-nothing-at-all? Must the firm junk its entire fleet of PCs to implement this solution? What procedural costs exist? What training will be necessary and how much will it cost? What is the risk of failure?
A show of hands...
How many Wavoids are on margin? My guess is: An unhealthy number. NASDAQ is headed for a margin-call swan dive and it's going to take WAVX with it. Of course I could be wrong.
kevin: Glad to see you finally agree with me...
that MSFT is not a WAVE ally and never has been. They have used WAVE as a pawn in their little chess match with INTEL (via the vague Palladium PRs) and now INTEL has returned the favor. Perhaps the pawn will advance to the final row, but that is a fairly rare occurence. I think the odds remain long.
Doma: What about the cost of the PC?
In your scenario you act as if throwing away the entire inventory of PCs is without cost. What about training? What about procedures? What about transition time? These are things that decision makers must consider, doma. The $45 is only the tip of the iceberg.
allman: I've already read that...
article and I believe it supports my general proposition that cost will be a major consideration of the target market. I'm not saying it will never happen (although that, too, is possible), I'm merely making the point that early 2004 or even late 2004 is unrealistic for meaningful revenues.
A prediction follows...
Wave will fail to even approach breakeven in 2004 due to slow acceptance of the Trusted Computing initiative by the enterprises it targets. Cost is an object. Halliburton or Raytheon or Avery or whoever the enterprise might be, they are going to study long and hard before they commit major dollars to buy into this thing. And small business will be a no-show for a minimum of two years.
Scorpio: Actually, no. YOU missed the point...
You talk about revenue generation and that's all well and good. I understand why the OEMs drool over the TCG model. But what I am attempting to discuss is the added cost to the ULTIMATE user. The enterprise who is faced with a decision to spend X million dollars to implement trusted computing throughout its organization. Those are the folks who will determine whether trusted computing flies or not. And those revenues you're so thrilled about? Somebody's on the other end of that stream. The enterprise paying for it. The cost structure is something that Wavoids have studiously ignored forever.
P.S. to Zen: If you think the guys who want all the bells and whistles in the enterprise are the same guys holding the checkbook, you need to reconsider. If you're GE Capital and you're making a go/no go decision on whether to do this trusted computing thing, it ain't gonna be IT that decides.
Scorpio: And are these BLOBS free?
Or is there a cost associated with them? The IT folks might say Eureka, but the finance folks are going to want to know what all the costs are. Wavoids have been lowballing the cost hurdles for about four years now.
Doma: You think the enterprise sector...
likes to read stuff like this?
"People maintaining PCs using trusted computing will need to create something called "migration blobs", so that in the event of computer theft or other disasters, everything can be restored to a fresh PC."
I say it's gonna be a tough sale even without migration blobs to worry about. This sort of thing only makes an enterprise want to wait longer and let somebody else be the guinea pig.
BIALLY: You forgot to mention money...
which, I suspect, is some part of the motivation behind certain posters' unflagging support for the person who has compensated himself in grand fashion regardless of whether the company could afford it or not. How many of these folks are contractors/vendors/schmooze-buddies of Steven's and rely on him for revenues? There is an entire faction of these individuals on this and the Doo Dah board, I believe.
btk: Whaddaya mean...
"... HhH is oddly the visionary, he always said the tech was untested, expensive, and likely prone to failure."
Ain't nothin oddly about it!
Nagravision! Maybe there'll be a new PR...
announcing some sort of alliance with those folks! One can only hope!
btk: You are very wrong...
on your membermarks. One comes from me. I hope this doesn't waste too much bandwidth. Let me throw this in for content: Watch the tape. It never lies. (Which, while it might be true is little consolation to the 99.999% of individuals who have no idea exactly what it is the tape is telling them, myself included.)
zen: You haven't reached the end result...
yet and, to the best of my knowledge:
1. Finread has not resulted in a penny's sales for WAVE.
2. Cyber-Comm has not resulted in a penny's sales for WAVE.
3. Not a single OEM has promoted WAVE in anything more than allowing a blue-line.
4. The Envoy sales results were, as I predicted, zero.
5. Nothing good would come of the much-ballyhooed SSPX ten million dollar deal.
6. The expectations reflected in the Donald Duck contest were, as I said at the time, utter insanity.
I could come up with more, but thats just six non-red-herrings I've offered up over the years.
P.S. to doma: You're discussing benefits, not costs. What do these benefits cost the adopting enterprise. I'm talking in totality. Hardware, software, support, training, the whole enchilada. Hint: It is a huge number. Ask the folks at EDS.
zen: There is your mistake...
the "nominal add-on price" part. How much do you think it would cost a GE, for example, to get this additional security? Be specific.
P.S. to Doma: Multiplied by how many computers? Increased by how much time to rewrite procedures, retrain employees, etc.?
Zen: Explain to me the value proposition...
to the ultimate consumer, the enterprise. The OEMs are not going to deploy much in the mere hope that businesses will buy into the trusted computing initiative. (Granted, the OEMs may wholeheartedly wish they would.) Explain to me how the brick and mortar firms come to the conclusion that they need to spend millions of dollars upgrading their systems, rewriting their procedures, etc., etc., etc.
Go ahead. Somebody essplain it to me.
Weby: I agree wholeheartedly that WAVE is like an onion...
you more leaves ya peel off, the more ya wanna cry.
24601: Nothing defensive about my reply...
to you. I merely asked you to clarify the question. Yes, I did say that Financial Reporter was for real. That was not a value judgment, just a heads-up that he was not a pretender. Actually, I thought I was being quite magnanimous with this gesture.
P.S. Good morning to you, Sheriff Matt. I hope the sun is shining wherever you might be and that birds are chirping and bees are buzzing and that you might some day in your infinite wisdom allow me to make more than three posts per day.
P.P.S. To Orda, who I predict will wonder why I think I get only three posts a day, it is a rule that apparently only applies to certain individuals whom Sheriff Matt determines should not be heard more often than that.
24601: Don't understand the question...
Are you asking if I sent Patterson a bill as if I were a big leaguer or are you asking if I somehow touted Patterson to others as if he were a big-leaguer.
If a, the answer is no. I did not bill him for my time, big league, little league, or no league at all.
If b, the answer is no. I did not suggest to anyone that he was in any particular league. I think his story was FAIR AND BALANCED. Especially the title.
And now I must sign off for the day. Have a nice day, Matt!
Did anyone inquire as to the NEC SCR...
deployment and the activation rate that resulted therefrom?
tampa: That's very similar to the Claugus response...
remember when WAVE was trashed by Claugus in Barron's? And nobody from management made any response to it? Peter later explaining that it makes no sense to argue with folks who buy their ink by the barrel? As if the argument was with Barron's and not with Claugus. That struck me as too weak to be credible at the time. What I suspected then, and what Steven's SHM remarks reinforce, is that these folks really prefer to avoid scrutiny. Are there strategic reasons to avoid scrutiny at this stage of the game? I don't think so. I am convinced that they just don't like having their egregiously greedy behavior highlighted.
The fun part is predicting the cult's reaction...
1. Writer is a hack.
2. Writer is jealous of Wavoids.
3. Writer is a short.
4. Writer works for Cramer who hates Dave Nadig.
5. Writer can't see the future being generally an ignoramus.
6. Writer focuses on the past and, well, the past is behind us.
7. Writer is anti-TCG.
8. Writer secretly works for Wave's competition.
9. Writer is jealous of Steven's glorious profile.
10. Writer is a Communist concerned with things like executive compensation.
11. Writer will really be jealous one of these days when we're all rich and he's not.
And that is all for today. Signing off from Hotel California.
Well done, Mr. Patterson...
And now prepare for the brick-bats!
24601: Where is the disclosure...
of Peter's options exercised and sold (or not sold, if any)? Surely the company is not going to assert that he no longer qualifies as an insider.
zen: I disagree...
I very early on suggested that Cyber-comm would be compromised by VISA/MC and, later, that FINREAD would suffer the same fate. I have no reason to believe that those beliefs were erroneous. In fact, rather than red herring, I think it was pretty much dead on, albeit with the major assistance of the smart-card folks. As to the "bogosity" of PRs, how does the issuance of one or two valid (if vague) PRs cure that? Are you arguing the Envoy launch is now a valid PR? These were issued for the purpose of inspiring the Wavoids, in my opinion. There has yet to be an Envoy sold, as far as I know. As to people taking this management seriously, it remains to be seen. I think the company faces daunting obstacles that even experienced management would have a difficult time overcoming. These people are amateurs. Exceedingly greedy amateurs, at that. Not a good combination.
And that's it for me today.