SGI in Talks to Sell Alias Software Business 2004-02-11 - By key
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I completely agree with you that 3D is a small and crowded market. I
just thought it was interesting to see the actual numbers. A few
million dollars in profit could easily be eaten up by operating
expenses.
Even the top effects houses are lucky to break even. Gaming is where
you see some impressive profit.
In this climate of penny pinching and outsourcing I hope soft can
continue with their great discounts and maybe make it a part of regular
pricing.
I'd be curious to see what SI's profit margins are. Anyone here have
Avid stock? ;)
--- Jaco <raffaele.fragapane@(protected)> wrote:
> people imagine the 3D market to be some cashmilkable cow or something
> like that, but net margins like those are not that bad at all.
>
> 3D is a small market that is most def excessively overcrowded and is
> now
> selling products way under what their pricetag should really be.
> it also requires investments in R&D and support that are much larger
> then almost every other kind of software at front of just a few
> thousands licenses sold.
>
> it's not like hundreds of thousands of licenses are sold all the time
> you know :)
>
> Discreet claims an installed base of 400k licenses for max, and this
> includes old non updated licenses, evaluation licenses, freebies,
> educationals and a bit of overexageration.
>
> take away the company expenses, marketing, R&D, acquisition of
> smaller
> companies, patents, purchases of technologies, shipping and handling
> and
> everything else...
> and you could notice that the most diffused mainstream app in this
> industry could have maybe made a net margin way under 100 millions in
> over 7 years.
>
> I seriously doubt SI's margins are anywhere beyond doubling Alias',
> and
> SI is in quite good health at the moment.
>
> btw anybody noticed how these SGI news totally eclipsed the news
> about
> discreet laying off A LOT of people all over ? lucky SODs :)
>
> -- --Original Message-- --
> From: owner-xsi@(protected) [mailto:owner-xsi@(protected)] On
> Behalf
> Of key
> Sent: Thursday, 12 February, 2004 1:33 AM
> To: XSI@(protected)
> Subject: Re: SGI in Talks to Sell Alias Software Business
>
>
> One item I found very interesting was the profitability of Alias:
>
> "Alias generated approximately $18.4 million and $34.2 million in
> revenues and an operating profit of approximately $2.7 million and
> $3.1
> million, respectively,"
>
> Usually Alias numbers are hidden behind SGI's, much the same way
> Softimage is under Avid. What struck me was how slim the profit
> margins
> are!
>
> ---
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