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Let's take a minute to analyze Omega Research's business model. It currently
is a one product software company, that product being aimed at a small
market of demanding users. Fortunately, due to the peculiarities of that
market, their product has little or no price sensitivity. Be that as it may,
the Omega business model is a boom or bust business with wildly fluctuating
revenues against a constant or increasing cost structure. This is
particularly difficult for public company reporting. (Accounting students
can study Microsoft's accounting changes designed to smooth revenue
reporting.) I am sure that Cruz understands this and is taking steps to
change this. As support for my premise, I offer the following evidence:
1. The new features of Pro Suite 2000 has been designed to appeal to stock
traders. This is the growth segment of active traders and the growth market
for investment software.
2. The promotion of seminars. This is a common way to generate recurring
revenues from an established product. The EL language programming club is a
similar approach.
3. What I believe will be an entrance into the data business. Omega has made
clear their intentions to peddle end-of-day data some time in the near
future. What the acquisition of WOW gives them is a existing data feed. I
predict that Omega will offer an integrated product, feed and software, for
a fixed monthly fee. This will get them into the monthly recurring revenue
business, which is generally a much more attractive business model than
their current one. If this takes place, the emphasis of customer support
will be placed on the monthly subscribers rather than the one-time software
purchasers with no-charge running program changes which will be collected as
a for-charge update for program owners.
JFB
Shaven Heads Trading
NYC
-----Original Message-----
From: Jay Mackro [mailto:jmackro@xxxxxxxxxxxx]
Sent: Tuesday, October 26, 1999 1:00 PM
To: Howard Jackson
Cc: omega-list@xxxxxxxxxx
Subject: Re: Thoughts on Omega & WOW
Oh, you guys are such cynics!
The acquisiton may make sense, and much as we have a
"love-hate" relationship with Omega Research, we DO at
least want them to remain alive. Don't we?
In acquiring WOW, Omega is eliminating at least one
competitor. A lot of Microsoft's acquisitions were less
to gain the people + products, and more to just get
rid of a competitor. It's hard to put MSFT and Omega
in the same thought, but at least on this point, ...
Second, "Windows on WallStreet" is kind of a neat
name, especially for an introductory product. Didn't
Omega used to sell a "dumbed down SuperCharts"? It
was called something like "Wall Street Wizard"? I
remember seeing it at a mall software outlet. Perhaps
Omega is going to re-address that market, which could
be an OK strategy.
Much as we may resent Omega's crummy product
support, and abysmal quality control, if they can do
something that brings in revenues from a source other
than continuing to soak the TradeStation users, then
I am all for it.
Jay Mackro
-----Original Message-----
From: Howard Jackson <hrjf4@xxxxxxxxx>
To: omega-list@xxxxxxxxxx <omega-list@xxxxxxxxxx>
Date: Tuesday, October 26, 1999 8:35 AM
Subject: Omega buys WOW!?!?!?
>http://biz.yahoo.com/bw/991026/fl_omega_r_1.html
>
>Anyone care on comment what this means to us? how will
>it affect us users?
>
>H
>
>=====
>
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