My Radware Manifesto Part II by: kdp2561 12/2/99 1:16 am Msg: 3756 of 4875 These two philosophies have both worked in the past. For instance, Dell is the best example of the direct marketing technique probably in the history of business. Michael Dell realized that people knew what they wanted in a computer they just needed someone to give them what they wanted quickly and efficiently. This is what FFIV is trying to do. They are going directly to the customer.
The other philosophy of establishing relationships/partnerships and using them to get your product mass acceptance was used by Microsoft, arguably the best company in the history of the world. Bill Gates realized that by licensing MSWindows to every clone computer maker and their uncle he could gain market share in one fell swoop. This method was what Apple lacked. Apple had better products, they were more powerful, and they had a very, very devoted following. But, Apple never established the relationships necessary to gain mass market acceptance. It didn�t matter if people at company A and company B used Apples, because they weren�t talking to one another. But when they went to a computer store and they saw the myriad of companies using Windows they took notice. This is RDWR�s strategy. They are gaining market through established companies.
Here�s what I think this all means. FFIV will continue increasing sales at a breakneck pace and will be heralded as the leader in the industry for the next 1-2 years. They will be used by dotcoms that have more people devoted to infrastructure and know specifically what they want from FFIV. RDWR will continue to establish relationships/partnerships with large infrastructure development companies. In the next 1-2 years these partnerships will gain critical mass and earnings will begin to increase at a faster rate than even FFIV�s(my time scale may be off as things are constantly happening faster these days). RDWR�s products will be used by people who don�t even know they are there. I think larger more successful dotcoms will turn to the traditional industry leaders (Cisco, IBM, Lucent, etc.) for help in infrastructure management as they find that they can increase margins by having outside people deal with portions of their business that they are not experts in (sounds like RDWR, huh? Avoiding sales and concentrating on technology.).
This bodes ill for FFIV unless they can do what Dell did. They have to make purchasing a server so easy that any guy off the street can go and do it. If they can do that they MAY survive long term, but the server industry would become much like the PC industry where it�s like you�re buying a BigMac. Unfortunately, for FFIV I don�t think this will happen. I am sure they will survive for some time as there will be room for many in the market, but they won�t be the leaders.
At this point is when the battle will really start. When a clear winner emerges from the battle between RDWR and FFIV they will be up against CSCO. What will happen here is something I won�t even venture a guess on!