Syarzhuk Kazachehnka <bamboo7431@...> wrote...

> For the year ended on Dec 31, 1999, Inprise earned $150.550M in revenues
> from "Licenses and other". Cost of "Licenses and other" revenues?

$19.267M.

> That means a dollar invested in "Licenses and other" earns $7.81 - not

bad!

> "Services" - revenues - $24.256M, cost of revenues - $22.676
> So the dollar invested in "Services" earns $1.07
>
> Now tell me which business would YOU want to be in - the one where you

earn

> 7.81 on the dollar or 1.07? So where is the "future"?

If you look more closely, "cost of licenses and other" does not include R&D,
or "selling, general and administrative" expenses. Presumably it only
includes the cost of printing boxes, stamping CDs and shipping them out.

The 'cost of services' is pretty much tied up in the people providing the
service. You sell $1000 of service, it costs you $950 to pay the guy
providing the service and provide equipment. For boxes of software, you sell
$3000 of software, it costs you maybe $20 for the box and the CD. The real
cost was in R&D and was incurred in a previous period (R&D being an
investment after all).

The thing I found interesting was $42M spent on R&D and $123M on "Selling,
general and administrative". That's a lot spent on "stuff".

However, I personally think services can't pay enough per share for the
likes of Redhat etc. to ever be profitable.

--
Tim Knipe | Plasmatech Software Design | http://plasmatech.com
Windows Explorer controls for Delphi, C++Builder and ActiveX!