Re: DevCo News This Month ??

"Serge Dosyukov (Dragon Soft)" <"serge [AT] dragonsoftru [DoT] com"> wrote in
message <451c0052@xxxxxxxxxxxxxxxxxxxxxx>
Even though Boralnd has no interest in IDE division what so ever, but I
think they are trying to get every single dollar out of the deal so it will
help them boost their cash flow. So they do not want to sell it cheap and
then realize they did it after DevCo raize from the ruines.
On another hand, people investing in DevCo would not want to overpay for it
since DevCo might not raize at all.
Tiny balance, ah? So I think it is lawer talking which takes so long and
DevCo team cannot do much about it and therefore it is unfair to blame them
for this.

The thought has occurred to me that it is entirely possible that lawyers and
Sorbanes-Oxley together create an environment in which the spin-off is unlikely
to occur after all, even if the economics were otherwise there.

The economics of the deal is what worries me most though. Borland is an
international corporation with offices and distribution channels in quite a few
countries. Delphi, DevCo's prize possession, is primarily an international
success, requiring an international span of offices and distribution channels.
I've not read or heard anything to suggest that DevCo is getting any part of
this world-wide office and distribution network as part of the sell-off. If
only the products and the personnel in Scott's Valley are what a potential
buyer would be getting access to, then the resulting package is worth only a
small fraction of the prior profits that Delphi had been supposedly generating.
Value is not just an intrinsic characteristic of a good, but of the
distribution and availability of that good as well. Delphi without an
international market is like an operating system being sold out of somebody's
garage rather than one sold by a firm like Microsoft. The same product sold by
a marketing behemoth like MSFT is worth a hell of a lot more than one sold by a
nobody. Market presence and access is EVERYTHING.

It is precisely this need for a large international market and distribution
network that worries me about the planned buyout. If the potential buyer were a
large established firm like MSFT or Macromedia or such then the necessary
network is in place for a product like Delphi. But if the potential investors
are just a bunch of guys that could scrounge up the cash, then one half of the
equation is missing. I can't help but think that the guys in Scott's Valley
know this all too well, but said they preferred a small group of nobodies
because it became obvious to them by the time everything was announced that
this was all they could attract after all.

I see a lot of Panglossian feel-good rhetoric from the faithful, also known as
denial. What I don't see much of is an admission that the value proposition is
a shaky one, for reasons that have nothing to do with the features of Delphi.

--
***Free Your Mind***

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