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No. of Recommendations: 5
Interesting article from Gartner on application servers, courtesty of OhYeah from the BEAS board. States that most people are buying high end app servers when all they really need are the cheapy low end servers. If true this would give ammunition to those who say that the app server market will become commoditized to the point that only the applications will matter, except in the high-end. Of course, the high-end is where everyone is shooting for at the moment:

P.S. Disclosure, Disclosure, Disclosure, I bought OPWV again today. The stock crashed based on two things. (1) yesterday there was some rumor that video on demand via cell phones was not taking off in Korea (I'm certain this will kill the worldwide industry), and (2) Morgan Stanley analyst came out today essentially saying that OPWV cooked the books for this quarters earnings and that therefore it will be even more difficult for them to make the coming quarter. Of course OPWV gave guidance of 10% sequential growth, even in the seasonally slow 3rd quarter. Either the former #2 man from Cisco (now OPWV's CEO) learned nothing from Chambers and controlling expectations over the years, or the man is completely dillusional, dumping all his shares as we speak, and is looking for shareholder lawsuits as the earnings conference was less than one month ago.

Nevertheless, it was worth triple volume and a massive pounding on a stock that almost every analyst asserts has enormous long-term potential, but might have trouble during the next quarter or two during the 2.5G transitional period. Currently selling for less than 2x next year's projected revenue which gives OPWV an awful lot of room to miss and still be cheap. Heck, it can lower earning projections for next year by 50% and still have a forward P/E of 36. Seems to me, right or wrong, this analyst is just following the herd (as they did at the top) as it is the safe thing to do.

But, just in case, I will be relistening to last quarters conference call where the exact questions raised by this analyst were raised and answered if memory serves. Going down with the Titanic.

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