SAN FRANCISCO -- Sometimes, you gotta hate technology. The second that RealNetworks (RNWK) - Get Report CEO Rob Glaser began touting his company's technology leadership at the BancBoston Robertson Stephens Tech '99 Conference Monday, the slides on the room's video screen went berserk, flashing on and off, disintegrating into a jumble of unreadable gobbledygook.
BancBoston analyst John Powers glared at the screen, while a tech support geek tried to remedy the glitch as the standing-room only crowd fidgeted. Glaser, employing his trademark staccato delivery, tried to keep things running with a quip, joking that RealNetworks are the "first people to deliver streaming slides." The problems continued throughout the presentation.
It was a distraction to an otherwise lackluster spiel. One newsworthy factoid demonstrating the strength of RealNetworks' sofware: Glaser said that as of this past December RealNetworks had sold over 1 million copies of its new PlayerPlus. Perhaps the most salient scrap of news came when Glaser said that RealNetworks plans to commercialize the channel guide of the RealPlayer, RealNetwork's streaming software that controls 85% of the streaming media market.
"We see increasing opportunity to monetize that," said Glaser, who noted that the guide's main purpose is to promote RealNetworks' content partners. "We'll be pursuing both opportunities as the year moves forward."
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The other highlight of the presentation was unrelated to RealNetwork's business. As a demonstration of the RealPlayer's high-bandwidth streaming capabilities, Glaser staged a demo from the new
trailer. The audience seemed generally soothed as lush pictures of alien landscapes and racing battle ships flowed across the screen. But then the glitch struck again and Glaser returned to his fast-paced pitch.
Walking into an elevator after the presentation, one money manager offered John Powers some advice: "You guys need to get some new slides."
-- Spencer E. Ante
Sun's NC Rises Again
The network may be the computer for
, but its own much-hyped network computer product is still sitting quietly on the sidelines.
Steve McGowan, vice president of finance for Sun's computer systems division, said shortly after his Monday presentation at the BancBoston tech conference that a third "NC" version was coming out around June. Some of its bigger corporate clients -- McGowan declined to say who -- are showing renewed interest in the project.
Meanwhile, the rest of Sun's operations are running more smoothly. McGowan said its enterprise services division saw revenues grow 38% year over year in its second fiscal quarter ended December 1998 -- a faster growth rate than any other Sun unit. "We expect to continue to add personnel to this division, especially to our professional part," said McGowan.
In terms of the
, which is expected to be completed by the end of next month, McGowan told a rather sparse crowd that the deal would be neutral to Sun's earnings in the first year after the deal's consummation and will add to earnings after that.
McGowan also suggested that Sun would take 1.5 percentage points out of its selling, general and administrative expenses over the next two quarters -- they currently stand at 27% of revenues. Opeating margins, which hit a high of 13.5% in the latest quarter, will also fatten thanks to increased revenue growth.
BancBoston Robertson Stephens'
PC and semi analyst, said Sun's third quarter looks encouraging. Sun's guidance of 18% to 20% year-over-year revenue growth in its third and fourth quarters hasn't changed.
-- Eric Moskowitz
Turnaround for VLSI?
From wired to wireless. That is what
is banking on for future growth.
Chief executive officer Alfred Stein told investors at the BancBoston tech conference that that VLSI would participate in the top three wireless technologies. That will be especially significant if, as Stein predicts, "wireless is slowly replacing wired infrastructure and becoming a pervasive technology."
Stein also said the company has been gaining market share and that the outlook for the communications chip company is better now than what he would have predicted in the fourth quarter of 1998.
But some investors remain wary. In 1998, the company missed earnings forecasts after losing some orders from major customers, including wireless phone maker
. It also laid off staff and had a chief operating officer resign. In the December quarter, VLSI posted a profit of 31 cents a share, up from a loss of 8 cents in the previous quarter, but down from 45 cents in the same quarter a year before.
"They sound like they are turning around with some new products, but the question will be how much of these products are proprietary and
how much people will pay up for them," said one Bay Area-based fund manager. "Their gross margins are still low for a chip company."
-- Medora Lee