Editorial: Tell him he's dreaming

Editorial: Tell him he's dreaming

IBM's decision to segregate its software distribution should be good news for most concerned. Some more than others.

Meier Business Systems (MBS) director, Martin Meier, was quite understandably cock-a-hoop to hear that his company has been accredited with a DB2 information management specialisation. Congratulations also to Igatech Consulting, which has been granted the same specialisation.

It is quite an outstanding achievement when you look at the other heavyweight names that have been given specialisations for Big Blue's other software - Express Data, itX, LAN Systems and Avnet are all much larger than either of these niche Victorian companies.

LAN Systems will be celebrating its addition to the ranks. While it will need to compete with Express Data for specialist deals on Tivoli security and automation, the appointment is still a major tick of approval that adds weight to its core business. Furthermore, it will improve its position in the local licensing market.

The pick of IBM software in terms of dollar potential is Lotus, which will continue to be dominated by Express Data and itX. Those two will further tighten their grip on that market.

Avnet looks to have lost ground having missed out on the Lotus business. However, with a monopoly on Tivoli storage, and a new software manager to boot, the distributor will be trying to make the most of its investment.

From a reseller perspective, the most important change is that each distributor has been given particular areas on which to to concentrate. They will earn better margins for selling those specific products, sharpen their skills in those areas and provide more knowledge to dealers. With any luck, pricing might improve too.

Elsewhere in the channel, the increasingly ill-tempered valuation dispute between Commander and Volante continues to go from strength to strength. Verbal volleys are now being traded at such high speed that it's been a bit like watching a rerun of Federer versus Bagdahtis.

As previously reported, Volante labelled Commander's initial offer of $1.01 as "absurdly low" and recommended shareholders reject it. Fair enough. But the response compiled by an independent expert (hired by Volante) looked optimistic to say the least. A valuation of between $1.27 and $1.44 gave far too much weight to unsecured contracts and an assumed upturn in fortunes.

Commander returned fire by claiming the counter-valuation was based on "blue sky forecasts" and pointed out that Volante hasn't had a very good record of meeting its forecasts since listing on the ASX. Miaow. It's easy to imagine the Kerrigans debating the value of Volante in cult movie, The Castle.

  Steve: "Dad, there's a bloke here selling a former hardware reseller that he's having a terrible time converting into a services company."   Darryl: "What's he want for it?"   Steve: "$1.44 a share."   Darryl: "Tell him he's dreaming!"

Commander issued a fresh statement the day before this issue of ARN went to press that extended its offer to Volante shareholders from February 10 to March 9. So it looks like the tirade tennis is set to continue for a while yet. New balls, please!

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