Notebook 03.06.12: RIMM, Product Cycles and Content

I am off to OFC/NFOEC tomorrow and as Andrew Schmitt of Infonetics tweeted (@aschmitt) earlier, I am looking forward to the “Drink every time someone uses the word “bandwidth” and “explosion” in the same sentence. #OFCNFOEC drinking game.”  This is post is a collection of things I am thinking about, therefore I am writing them down in my notebook to validate or dismiss.

RIMM: With the news last week of more layoffs within the WebOS group at HPQ, it shows the missed opportunity that RIMM had with PALM.  If RIMM had acquired PALM instead of QNX, they would have had a legit, complete OS to put across their devices.  The mobile device market would have four OS contenders – not three.  Unfortunately, HPQ acquired PALM and has pretty much killed WebOS.  I am not saying that acquiring PALM would have saved RIMM, but they would have had a chance.   I have spent a fair amount of time posting about RIMM; I read the other day that RIMM was up that day on take over rumors.  I still wonder why would someone want to own the RIMM business?  Seems crazy to me and as for the new CEO, I agree with him the only way out is hard work and hope they made some correct decisions.

Service Providers: I read an interesting sell side note from Deutsche Bank today in which the analyst (Brian Modoff) wrote that he had spoken to several US carriers who were disappointed in one of their large infrastructure suppliers because this company was not designing products how they wanted the products designed.  Well…that pretty much sums up my post here and here from the last few weeks.  Nothing kills creativity faster in the organization than becoming the outsourced engineering arm of your customer.  I want to solve my customers challenges, I just want to do it on terms that are best for my business – not their business.

Content: I have posted three times on content.  For some reason, I glanced at a TV today in a hotel lobby that was tuned to CNBC.  There was some bizarre conversation about Apple and mobile devices and Dow 13k and it triggered a thought.  One of the trends I have been tracking is what I call DIY content.  That was the point I was making about Verizon not buying NFLX, but hiring the team from NFLX.  My view is that it is increasingly easier for content owners to distribute their content and this will increasingly pressure content distributors and content aggregators.  The middle ground between the consumer and the content creator will NOT be a good place to be unless you can own the distribution ecosystem (i.e. devices) like AAPL.

Off to LA tomorrow for OFC and looking forward to meeting PollyAnna and hearing about the how the internet is about to break under the weight of all those videos.


* It is all about the network stupid, because it is all about compute. *

** Comments are always welcome in the comments section or in private. **

Notebook 12.19.11: NFLX, Mobile Devices and SP CAPEX

In the world of virtualization, we are somewhere between exiting the first stage and seeing how the second stage develops and ultimately it will all depend on how the third stage develops to see if the virtualization wave translates into a big driver of the cloud.  Here are the three stages of the virtualization:

Stage 1 Server Virtualization: Server virtualization made life a lot easier for sys admins.  This was the primary driver for the first wave.  It is still on going, but we are in the sunset for this stage as we are seeing the emergence of the second stage.

Stage 2 Software Stage: This is the stage that we are currently in and we will see if the business proofs created in this stage become sustainable, long term businesses.  In the second stage of virtualization, software engineers begin to write software differently.  Software is architected for the virtualized environment.  This is about open APIs and a cultural shift in software coding behavior.  If want to dig into the details of what I am referring to I suggest you review this 269 slide presentation here.  I inserted an interesting slide from the presentation to the left.

Stage 3 Real Businesses Emerge: This is the next foreseeable stage of virtualization and developments in stage 2 are trying to test or prove their efforts in stage 3. The real businesses that emerge in the open API / virtualized infrastructure of the cloud will be called proofs.  I am not certain if we have many proofs yet, but we are trying.  I do not see a stage 4, but that does not mean a series of additional stages will not appear – they are just presently not visible.


This brings us to NFLX which has certainly been the subject of a lot of drama this year and I too have written about NFLX here, which I point out specifically for the commerce reference of Braudel which I think is important to keep in mind when evaluating content businesses.  Last week NFLX stock was rallying on take out rumors by VZ.  A buy side PM friend emailed me “You see desperate NFLX longs put out rumor today VZ was interested acquiring them. Totally stupid and you would think they could make something better up. Closed down 3.”  I tend to agree with the comment for two reasons.

(1) The first is that NFLX has a content acquisition problem for which they need to raise capital.  That is clearly a problem that VZ would solve, but what would VZ gain?  The NFLX service is an open API hosted on the AWS infrastructure, i.e. stage 2 of virtualization.  The question is how sustainable is the business and will it become a proof in stage 3?  Here is an excellent overview of the NFLX open API.  Back to the VZ acquisition rumors and for all I know VZ could be buying NFLX at this very second, but I would suppose the real value of NFLX to VZ is the engineering team that built out the open API platform in a year.  There is value in the subscriber base, but clearly this has been greatly diminished.  Therefore, I think the real value is the 300 engineers and 700 employees that built the product offering.  If that is true, that brings us to the second point (2) as I think VZ could hire that team for a lot less than paying for the whole company.

Mobile Device Market

Gigaom had two visually interesting posts recently on the mobile device market here and here.  If you look at the first post it shows a visual history of the mobile device market including the $1,000 StarTac in 1996 and $500 Blackberry’s in 2001.  My conclusion in the wake of RIMM’s earnings last week and this visual reminder of phones I owned over the years is that the mobile device market still sucks.

Service Provider CAPEX

Hard for me to understand why analysts are writing about CAPEX uncertainty for 2012 when there were warning signs six months ago.  Links to some of reports this morning are here and here.  Now that it is getting fully priced in I think it is time to start thinking about initiating new longs in the space over the next few weeks.


* It is all about the network stupid, because it is all about compute. *

** Comments are always welcome in the comments section or in private. ** 

RIMM at the Bottom

I have not found much to write about over the past week and I do not own a lot of equities in the PA at the moment, but I do own some RIMM at $17.50.  I am not a stranger when comes to writing about RIMM.  You can find my prior RIMM posts here, which can be summarized into three points: (i) the handset market sucks; (ii) RIMM is a product cycle disaster and (iii) the activists who want to break up the company lack any basic understanding of company’s technology.

I was looking at the RIMM chart today trying to figure out when to sell it.  I bought last week on Thursday just before the close because James Faucette of PacificCrest does not get positive on RIMM that often and his mid-day call made sense to me which was that RIMM was too cheap and trading at book value.  After the close Leon Cooperman’s Omega Advisors revealed they had purchased 1.43M shares of RIMM.  I am not certain if Cooperman called the bottom, but maybe he put a short term floor under the stock.  I was going to post daily and weekly charts on RIMM, but that is waste of time because the charts are beyond technical indicators.  About all I can get from the charts is that the 600MA is $36 on the weekly and the 20MA/50MA on the daily is $20.10/22.69.

Earnings estimates have a big spread $2.67-7.11 for the next fiscal with the mean at $4.77.  I think this number needs to come down to $3.50-4 and the average target price is $27.72 and this seems about correct to me.  I think the stock is fairly valued in the $24-27 range.  Here is what I do not believe in:

– RIMM is not a PE-Buyout target

– RIMM is not a M&A target (NOK/MSFT and MMI/GOOG deals killed that option)

– RIMM is not a breakup candidate (technology not separable)

– RIMM is not going to trade higher on some sort of IP monetization dream

If the leadership team wants to fix the company and get their currency higher they need to fix the product cycles, control expenses and stem share loss.  Note to the leadership team if the QNX device launch date is correct in this article, I sense a lack of urgency in the company.  2H 2012 is a long way off.


* It is all about the network stupid, because it is all about compute. *

** Comments are always welcome in the comments section or in private.  Just hover over the Gravatar image and click for email. ** 

Framing Exercise: Web 3.0 and the Network

I firmly believe that we are at the end of the Web 2.0 era and we are now in the early period of what I will call the Web 3.0 era.  My definition of the Web 3.0 era is going to be different from how web centric people will call Web 3.0.  I look at network from the perspective of (1) how the network is built, (2) what are the driving forces in the network and (3) what are the behavioral changes that will occur within the user community that deploys networks.

I have had a thesis on the evolution of the network that I have been building for some time.  It starts with the collapse of Web 1.0 in 2001.  Web 1.0 was the static content era based on HTML in which the network was not very efficient.  The inability of the network to support dynamic content is why companies such as AKAM were very valuable.  AKAM provided a fix to the network inefficiency problem and made the user experience better.  It was also an era in which a lot of CAPEX was spent on building long haul (LH) networks.  The problem was not a lot of CAPEX was invested in the access portion of the network and bandwidth swaps could only mask the lack of revenue bearing traffic from the access portion of the network for so long.

Frame 1: Web 2.0

Web 2.0 started to take root in 2003. The foundations for the network as a platform took hold and for the next seven years the network changed culminating with virtualization building a firm foundation, but there were many important network milestones along the way.  Social networking sites were started: in 2002, in 2002, in 2003, and in 2004.  State aware applications such as Gmail (live on 04.01.2004); user generated content sites emerged like in November 2005 and AMZN launched their S3 storage service in March 2006.  Web 2.0 destroyed a large amount of equity value in mobile device space because the legacy mobile device companies like RIMM, MOT and NOK were slow to respond with devices that supported the Web 2.0 world.  AAPL was really the first company to build a mobile computing platform for Web 2.0 and they were at the forefront of network evolution that Web 2.0 was driving with a property called iTunes that leveraged the network as a platform.  When iTunes and Web 2.0 were combined with a mobile computing platform called the iPhone in January 2007, magic happened.

I have included a series of 10-year equity charts for HPQ, INTC, AKAM, CSCO, NOK, RIMM and JNPR.  I have purposely excluded AAPL, AMZN, NFLX and DELL.  The charts I chose reflect the market collapse in 2008 and rebound in 2009-2010.  For discussion purposes I am going to ignore the market melt down induced by the global credit crisis and collapse of LEH in 2008.  I am already on record describing what I termed as the catch-up spend post the LEH collapse here and here.  As investors and technologists we should not perceive the catch-up spend as a new market cycle or validation of a technology or market strategy.  The catch-up spend was a reaction to a market spending contraction – not a new world.  I think the catch-up spend might have fooled a few companies into thinking it was the rebirth of their traditional market, when the catch-up spend really had nothing to do with Web 2.0.  Let me illustrate this point with a few long term equity charts.  Long time readers will know I like weekly charts on a ~10 year time span because I think they filter out the daily noise and help understand the direction of companies when overlaid with important events.  On each chart I have inserted an orange scribble line which is my attempt to insert a proxy trend line assuming that the macro credit crisis and catch-up spend events had not occurred and the consumption of technology was allowed to evolve independent of global events.  I trying to separate technology trends (i.e. product trends) and technology market evolution (i.e. technology adoption cycles) from outside influences which is the equity component of my Web 2.0 to Web 3.0 thesis.

HPQ: This is an interesting chart when you consider that it is framed by $25B for Compaq in September 2001 and the iPad shipping in January 2010.  Assume for moment that the credit crisis did not happen and the chart is down a bit in 2008 and then peaked in 2010.  HPQ acquired EDS in 2008.  They did this because they were believing in the ongoing propagation of Moore’s Law and the enterprises would consume more network infrastructure and having the ability to influence or control the decision making process in regard to that consumption was a good position.  Kind of interesting that the peak in HPQ equity coincided with launch of the iPad, which marks an important transition point for the PC market in the same manner that the iPhone marked a transition point for the mobile device market.

CSCO: A few observations from the CSCO chart as this is company I have written extensively about in the past.  They bought Pure Digital (Flip) at the bottom of the equity cycle.  The thinking was that video was going to be a huge driver of the next evolution of the network.  In June 2008, CSCO was starting to market and provide thought leadership around the concept of a Zettabyte Era.  They have continued to update the models and provide copious amounts of data on the subject.  The problem with all this data is I fail to see a follow through from the traffic trends in accelerating equipment demand.  I think the network is going to look different, but I think many incumbent vendors think that the network will look like the past.  After all, history does repeat itself (that was a joke).  In July, I wrote “intended network design has changed little in twenty years.  I look back in my notebooks at the networks I was designing in the early 1990s and they look like the networks that the big networking companies want you to build today.  If you are selling networking equipment for CSCO, JNPR, BRCD, ALU, CIEN, etc, you go to work every day trying to perpetuate the belief that Moore’s Law rules.  You go to work everyday and try to convince customers to extend the base of their networks horizontally to encompass more resources, vertically build the network up through the core and buy the most core capacity you can and hope the over subscription model works.  When the core becomes congested or the access points slow down, come back to your vendor to buy more.”  X.  Looking at the chart of CSCO, the average person would assume that NFLX streaming event would have been a big driver of CSCO revenues.  Hmm…why did that not happen or will it?

JNPR: JNPR is very much a product cycle company and I think the ten year chart illustrates that point.  The question is how will a hardware centric company do in a software/virtualized world of Web 3.0?

AKAM: I have already written a longer post on CDNs, thus I am not going to add much to that post.  What I will say is content deep networking strategies, increased fiber penetration and software based network controls (e.g. ADCs in virtual form, cloud based SLA controllers, etc) that enable the end-user to control the network access point in a world of state aware apps and real time content is not the best environment for companies that provide solutions intended to improve the inefficiencies of the network.  In other words, companies that created value by improving or fixing the network may see less applicability if the network requires less fixing and less improving.

INTC: The era of Web 2.0 was not overly kind to INTC.  They never made it big in the mobile device market, the PC market eroded over time and the glory of the 1990s never returned.  I am working on a thesis that Web 3.0 might be a better era for INTC.

RIMM and NOK: I have written extensively in the past about the mobile device market, but a few thoughts on RIMM and NOK.  Both NOK and RIMM missed the Web 2.0 evolution and how it would impact adoption of their products.  RIMM is another example of a company that fixed or improved the operation of the network and that function has little value going forward into the world of Web 3.0.  That is a direct reference to the RIMM NOC.  So much has been written about NOK I doubt I can add anything insightful.  What I will say is their equity charts are twins.  Both charts peaked between the iPhone 1 and iPhone 3G and launch of the iPad was just another kick when they were down.

Frame 2: Web 3.0

I would be upfront and say that my definition of Web 3.0 is very much a work in process.  I know it when I see it.  I am sure my definition will change and evolve.  Currently I am using the descriptor of: metadata personalization, real time content, big data, and big personal pipes with user defined controls.  With that sounding like research project, I am more inclined to just identify the trends and examples of Web 3.0 and let the definition take its final form in the future.  Here are some signs posts along the way that point to Web 3.0:

  • HP to sell or spin off Compaq ten years after they paid $25B to buy Compaq.  What screams “end of the Web 2.0 era” more than this decision?
  • Commodity HW and appliances with value add software will define the new network.  This implies that HW based network infrastructure will suffer margin erosion as legacy HW solutions reduce ASPs to match SW based solutions.
  • The network aides of the past become less useful (e.g. HW based ADCs, WAN acceleration, CDNs, etc) and new devices that aid content replication locally become far more important as networks see the transition from 10 to 100G.
  • User (consumer or enterprise) defined and controlled network pipes.  Power to the people to define and control their network experience (i.e. bandwidth).
  • Decline of managed services and the rise of the enterprise customer as their own service provider using managed fiber with peering relationships with traditional service providers.
  • More FTTH builds around world with governments helping pay for part of the infrastructure build.
  • Power, heat, cooling and all the physical requirements for big data deployments continue will drive the adoption of optics and content deeper in the network and an evolution away from OEO.

As always this post is just a rambling of my thoughts about networking.  None of it should be taken too seriously as I could easily be wrong.


* It is all about the network stupid, because it is all about compute. *

** Comments are always welcome in the comments section or in private.  Just hover over the Gravatar image and click for email. **

Mobile Device Market Just Sucks

On Friday I was partially correct on NOK.  This morning NOK lowered their Q2 forecast citing a number of factors.  The stock is (11.5%) in the pre-market.  I said neutral on Friday; apparently it has lower to go.  In the press release NOK is citing a number a factors including a mix shift to lower priced smartphones and pricing actions in the market by competitors as well as itself.  I just struggle to see why anyone wants to bullish on the mobile device market unless you are AAPL, GOOG, HTC and QCOM.  Competition is brutal and I think tablets will have a more significant impact that people think.

To compliment the NOK train wreck this morning, the Rodman & Renshaw analyst Ashok Kumar dropped coverage of RIMM citing a number of factors, but basically saying that product cycles are negative and the company is falling behind the product cycle marathon and is generally un-interesting.

Here is what we know about the mobile device market: NOK and RIMM have both preannounced negative in Q2.  AAPL will release the iPhone 5 sometime this year.  HTC has one of the best engineering teams in the business.  Software is generally homogenized around Android and Widows Mobile.  Device prices trend lower.  If you cannot differentiate like AAPL, how is this a good market?

Interesting article in the WSJ describing how Activision Blizzard is planning to launch a Call of Duty online gaming service.  Not a lot of surprise here, but the implications are interesting as content owners create distribution for their content whether that is games, movies, applications, etc.  Service providers want to impose usage caps and force high volume users into upper service tiers and they will probably partner to create special service classes for content providers.  For example, when you contract for broadband at your home, you will be able to add a monthly surcharge for a policy based connection to Netflix or the COD network or some other content.  Just a random supposition on my part, but I think policy based SLAs will be a way for service providers to improve broadband margins.




* It is all about the network stupid, because it is all about compute. *

** Comments are always welcome in the comments section or in private.  Just hover over the Gravatar image and click for email. **

Wondering why my 80 year old dad wants a smartphone and what this means for the mobile device industry

Over the weekend my 80 year old father sent me an email asking for advice regarding upgrading his Samsung feature phone to a smartphone.  Apparently my sister had suggested a Droid and my brother an iPhone and my dad was thinking Blackberry.  I replied to his email asking him why he wanted to upgrade, how he intended to use the device and what is in the new device budget.  My dad is not an early adopter of the latest technology trends, but his is not illiterate either.  Below is a picture of him from the Korea War when America was still using exchange name calling codes in a two letter five digit format.

He replied that he did not know what social networking is, but he would like to talk on the phone, read email and text.  He has never sent a text message.  That forced me to think about what kind of device to recommend.  His current feature phone was designed to be a phone.  When the engineers at Samsung designed the clamshell phone my dad is carrying their first design objective was to build phone for talking.  The phone has a text message function, but with a standard telephone keypad it is really not a texting device if you are over 18.  As a phone for talking, the Samsung device is great.  The battery lasts for days, rarely drops a call and it is small and easy to carry.

When the engineers at Apple designed the iPhone, their first thought was to design a mobile computing platform that leverages the Apple OS.  They then thought to put a voice application on it and call it a phone.  That is much different design path than the Samsung engineers who designed a phone and thought to add some text functions.

I have been carrying a Blackberry device since 2000.  It was not always a phone, but it has always handled email.  That was the magic of the Blackberry.  The engineers at Blackberry said let’s design a mobile email device that uses the cellular network.  Then they made it a phone and after that they decided to make it web device.  It was the step beyond email and phone where Blackberry stumbled.  Today, there is no magic to email on a mobile device.

Nokia made a colossal set of mistakes, but the biggest like Blackberry was losing the innovation war to Apple and buying Symbian.  Symbian was a great operating system for the feature phone era – but it failed in the smartphone era.

Motorola or MMI as they are now called simply stopped innovating.  They fell behind the other device leaders after failing to replace the magic of the Razr and had to recruit a new CEO a few years ago out of QCOM named Sanjay Jha.  I have met Sanjay many times and I give him credit as he realized the market for mobile devices was going to be a product development marathon.  Product cycles will matter.  Miss a product cycle and it becomes hard to catch up.  That is what is happening to RIMM in the present year.  When Sanjay took over he knew he needed an OS that would be a winner and he chose Android.  The whole mobile device market really comes down to three operating systems: Android, Windows Mobile and iOS.

HTC embodies the concept of product development as a marathon.  They are a product development machine with phones on Windows Mobile or Android.  Samsung and Sony-Ericsson are another two developers of smartphones who have seen the light and are now using Android or Windows Mobile.

The business model in the handheld mobile device space is to pick an OS: Android or Windows as iOS is not available for license and webOS (developed by Palm now owned by HPQ) is really a cool OS, but very small amount of market share.  Next you need to develop a nice user interface (UI) to go on top of your OS.  Hire some excellent hardware, packaging engineers, use the latest chips from QCOM, STM, IFX, BRCM, then build a device, find market distribution and off you go.  This is a somewhat long answer by me to the Edlar Murtazin blog post today speculating that MSFT will by NOK’s device business.  If I was NOK and MSFT wanted to buy it, I could not sign the paperwork fast enough.  If I was MSFT, why would I want a mobile device business?  I have a mobile operating system business.  Which is more valuable?  I think the later and we can debate if MSFT is executing well, has leverage, blah, blah, blah.

When I first saw the iPad I was a bit skeptical.  I had accurately guessed the price at $499, but I was not certain it was a game changer.  Then I used the iPad.  I now have three in my family and it is an amazing device.  I am still carrying an almost two year old Blackberry 8900 as a phone, because it works well as phone and I really see no need to get a new phone now that I have an iPad.  I am also a T-Mobile customer and have been one since 2002.  I am waiting to see if the merger with ATT goes through, what my options are post closing before making any new device or service provider choice.

Back to my advice to my dad who is a Verizon customer.  I told him to look at the iPhone as well as the Droid Incredible and the Thunderbolt by HTC.  As the weekend wore on I realized I might have given him the wrong advice.  Why does he need a smartphone?  The few times he makes a call, he has the perfect phone today.  If he loses the small Samsung phone no one would care.  It was free.  Get another one.  What my dad really needs is an iPad with 3G.  That is the game changer.  When I came to this conclusion my next thought was what does this mean for the stocks in the mobile space?

Here are a six ten year charts to look at.  I think these charts tell you where the mobile device market is going.  Ten year weekly charts are nice because they diffuse the daily noise effect from rogue bloggers.  The other option is read the thousands of pages of research published annually on the mobile device market.  I just think it comes down to who is making cool devices, who can keep making cool devices and who are the companies that are making parts for the makers of cool devices.  Product cycles matter.  They always matter.  Buy stocks in positive product cycles and short stocks in negative product cycles.  Anymore thought beyond that last sentence is too much thought.  People need to let their over analysis go, it is not that hard to figure out and you do not have to calculate RIMM’s earnings if they sell a few more devices in Chile because the 12-18 demographic likes the BBM.  It is not that hard.  Product cycles always tell the truth:

NOK: Here is the poster child chart for missing a product cycle.  I marked the introduction of the iPhone, but it should also be noted that between 2006 and 2008, NOK spent a lot of time in legal battles with QCOM.  I wonder how much this distracted the management team when AAPL was readying the iPhone.  I think the stock will bounce around the bottom for awhile.  I simply do not understand the people who want to bullish on a company in this much turmoil as if a windows phone in Q3, or Q4 or Q1 is going add $20 to the stock.

RIMM: The recent close below the bottom trend line is not good.  Will this chart go the way of NOK?  Missing product cycles really sucks.

AAPL: This is called a positive product cycle company.

MOT: There is no chart for MOT as it is two companies now and the current data set for MMI and MSI is limited.

QCOM: Over the past 3.5 years, I have met with this company many times.  These were very trying times for the company and the stress showed on the management team.  The chart really does reflect that distraction of the various lawsuits both to investors and management.  Those distractions are now behind the company and the recent breakout is very bullish.

MSFT: Last week’s close was not good for MSFT.  I would be watching it here.  I see many reasons why the company is in a negative product cycle, but I am more inclined to say this is being priced into the stock and it sets up for a buy in the 2H 2011.  Time will tell.

GOOG: No ten year chart here, but a nice series of higher highs and higher lows.  As with MSFT, last week’s close not positive, but I like how the company is setup.


** It is all about the network stupid, because it is all about compute. **

RIMM Pre Announcement and Smartphones

January 18, 2011: a cold, rainy, crappy night in NYC.  I am there to meet a hedge fund manager for a job interview, but he wants me to meet with another manager too so it is a dual interview.  During the interview, the second HFM asks me what is my recommendation regarding RIMM.  He is long a lot of RIMM.  My response was to sell the RIMM, but if he wanted to keep it then he should short NOK ahead of their investor day as a hedge.  He gives me a strange look and asks why he should sell the RIMM.  I tell him that RIMM and NOK are in negative product cycles that will not end well.  I have no idea what he did with the positions since he has not responded to any emails since the interview, but I do know what the stocks have done:

RIMM is down 20% since January 18 (yes it has been up and down, but should open up another 900-1200bps down in the morning).

NOK is down 23% since January 18.

If you think I am grandstanding…well…yes I am, but look at my April 15 post on GOOG.  Have a nice night.

Side note…a friend emailed me this during the RIMM conference call “Even the EMs starting to soften.  They [are] citing LATAM.  GFK has been noting EMEA flattening fast; could roll soon.  If the INT growth story is cooked, what is there………?  I maintain US has gone negative net adds.  Permanently.  VZ was the still the largest installed base.  Can’t tell me they stopped sub disclosure numbers for any other reason.”