Why I'm not in Tall.ob...
First off... full disclosure, I work for IBM Global Services as a senior technologist in application development and outsourcing. I have extensive experience evaluating third party software products and IT services companies.
When Tall.ob was mentioned on the RB boards a few months back, Bobwins asked me to take a look and give my inputs. My first take was that they were a small software company that has acquired some nifty products. I was immediately turned off by the large number of outstanding shares and continued dilution. But it was what I didnt see that made me nervous.
Simply put, this company just isnt spending enough, yet. They are attempting to sell a rather large array of diverse products. They have the ActiveCast Application, which is essentially an email and fax spammer. This offering is simply a server side application that you pay to use, and interact with through a browser, similar to IHub, Yahoo mail, or ebay. You dont buy the software, you pay to use it. Nice product, not too much overhead, and email spamming and list serving still have a market.
Then you have the TwinCentric suite of products. This is where I fail to see their 'true' costs. The TwinCentric suite contains 4 different products:
Net Visual - A screen scrapping product that takes MVS/Zos (mainframe) CICS or Adabase screens (green screens) and provides a conversion layer to turn the screens into web pages. The product is in the legacy transformation space, which is extremely competetive. According to Gartner IBM leads this industry with its Host Access Transformation Servers (HATS). I would guess that IBM has a dedicated development staff of approximately 40-60 people who work on this product through it various stages of development, testing, and support.
Caravel - This product tranlates old RPG and COBOL code into Java. The market share in this space is owned by Relativity Technology in Cary, NC. Again, a medium sized company, one main product, with a large staff of top-tier developers.
Smart Fields - This looks like some sort of oil well monitoring tool. Talk about product diversity!! I assume they have an oil well subject matter expert on the payroll?
ActiveLink - This product appears to be a data propagation tool. As data in a database changes, this tool will catch the event, and perform programmable functions such as placing the data into another data source, an XML file, or send an email to someone. Again, there are a wide variety of products out there that perform this functionality. This is very complex tool mostly because it is required to be compatible with so many different database systems such as Oracle, DB2, SQLServer, Sybase, MySQL, etc. etc.
My point here is that to maintain and support this complex set of tools is going to be very expensive. The companies Sept 04 10Q stated they spent 311,000 in the quarter. That wouldnt be enough to cover the software licensing required to test and develop these products. The licences to run mainframe applications such as MVS/TSO, CICS, Adabase, Expediter, FileAid, DB2, Oracle, NetView, OmegaMon, alone would cost more than 500K a year.
This says nothing of the vast talent that would be required to maintain these products. They have C++ code, Java code, COBOL code, RPG code, .Net code, ASP, and VB code. They must have designers, testers, architects, help desk personnel, sales support, and manual writers. WHERE ARE THESE COSTS? No way is $311,000 a quarter paying for all of this.
And talk about product diversity, today they announce yet another new product DisclosurePlus? Legacy Transformation, Data Propagation, Oil Well monitoring, Email spamming, and now corporate accounting compliance applications? This company needs to pick a product and make it a success. They dont have a snowballs chance in hell of making all of this work.
So, my guess is that they found some struggling software firms out there, and there have been many, and they made a deal to get the rights to these applications in exchange for stock. I would also surmise that they either have no idea what they got themselves into with the maintenance of the apps, or they are hoping to staff up with increased sales, or they are a scam.
My guess is number one. The reason I feel this way is because I worked for a company that did the exact same thing. I still own some of the stock... today its at .0001.
Just my humble opinion.
Echos
