SCO - What have WE Forgotten? 738
"Over the last eight months I have read countless posts on Slashdot regarding SCO and most if not all of the posts view the scene with rose-tinted spectacles. Promises are made that SCO will be buried and that McBride will find himself in prison, yet they are still there and McBride is still in charge. The men and women who play the stock market on a regular basis are no fools and something unknown to Slashdot readers made the SCO stock price rise by 2.4%, on December 26th, over half a days trading. If someone buys a stock they expect the price to rise, so what have WE forgotten that could be good news for SCO investors? The principle of 'many eyes' has been used by the Open Source movement before. Thousands of people examine source code, submit patches, and ensure that we give the best software we can to the community at large. Bugs are announced and fixed within hours and all of us know that this methodology provides a better solution than that offered by closed source products. We now need to apply the same methodology to the SCO problem, all of us need to consider what we know about this sorry affair and how we can legally contribute to the downfall of the SCO Group.
SCO have been ordered to produce their evidence against IBM by midnight on January 11th, 2004. This gives us [five days] to make sure that when the IBM lawyer marches into court he has a spring in his step, knowing that he has every Linux user on the planet behind him. THEN we can talk about SCO being buried, but not before.
Thank you for your time and a Happy New Year."
We have forgotten (Score:5, Interesting)
-- Cheers,
-- RLJ
we have forgotten (Score:1, Interesting)
Beware, sco may yet win!
Lottery Ticket (Score:5, Interesting)
Now, are things different on Wall Street?
I trade stocks for a living. Some of it is daytrading. from the category Cliff chose, 'from the daytraders-and-lawyers-live-on-different-planets-
The key issue here is potential; *if* SCO wins, it'll win $3B plus leverage vs every single linux user (if collectable, $699/installation for single-cpu installations, more for more processors; also $39(?) per embedded device). The payoff is huge and Wall Street functions on potential and leverage.
What does this imply (or explain) about SCOX and said stock price?
I once read an insightful quip in an investment article about SCO; the quip was 'Buying SCOX is like buying a lottery ticket'. Meaning, there's a huge potential payoff but, chances are, you'll get nothing. The SCOX stock price, hence, is an average of the perception of those two extremes.
2 years from now, SCOX will either be worth $100+/share or $0/share.
In conclusion, the rising stock price is a function of Wall Street's perception of the odds of this lottery ticket.
RD
Not about right or wrong (Score:3, Interesting)
The core of the lawsuit (Score:5, Interesting)
The crux of the matter, as I understand it, is that SCO is claiming that the SystemV contract specifies that they retain control over everything developed for SysV Unix -- regardless of who actually does the development. If you want to kick this back into copyright law (which is likely to become relevant), then they're saying that whatever you made is a derivative work. Even though you may license the SysV code it doesn't mean you can do whatever you want with derivative works.
There's a shitload of smokescreening going on, and SCO has made some really amazingly stupid claims (mostly their execs, not their lawyers, although the lawyers have made some stupid claims as well), but it really does get back to this -- is SCO's read on the contract the proper one? It's not a cut and dried answer. The contracts are very old, have passed through many hands, and have several court cases associated with them. The wording isn't clear either.
Personally, I still think SCO's smoking a big crack rock -- their interpretation of the contract is overly broad and utterly insane. But IANAL.
A coworker (ok... technically my boss) asked me yesterday when I expected the lawsuit to be resolved. I immediately replied 5-10 years.
Anyone who thinks that this is going to be finished before then is smoking one right along with SCO.
Re:We have forgotten (Score:3, Interesting)
-B
What if... (Score:3, Interesting)
Unless...they get taken over by some bigger company with an eye on the pie they have baking...
What I'm trying to get at is that with a market capitalization of merely 250 million and with the intellecual property claims they are making they are begging for IBM or (maybe even) Microsoft to buy them out.
Far fetched? Probably. But imagine if the SEC & the European regulators were to allow such a thing to happen?
(just remember where you heard it first)
Misleading investors (Score:2, Interesting)
With the lawsuit and the recent injection of venture capital, plus the latest financial reports saying their licensing drive is making money *but* they spent it on lawyers, I think the investors are keeping the stock until after SCO has to show their cards. If you see a stock jump from $1 to $20 at the high and is now at $10 with more news to come, might you not atleast *consider* paying the $10 per share incase they do have a legitimate claim against Linux which then pushes their stock way above $20.
Unfortunately this, to us, looks like a pump and dump (as shown by sco execs) but the SEC probably wont investigate until after the lawsuit is settled/dismissed/whatever and the outcome of it wont be quick. By that time I assume Darl and friends will be long gone to Soviet Russia/Cuba.
Just a thought, oh and IANAI (I am not an investor)
Maths and probability. (Score:2, Interesting)
So the valuation should be:
(0.98 x $0.28) + (0.02 x an obscene amount)
which could still be a big number.
Re:We have forgotten (Score:3, Interesting)
This most certainly HAS been the case. Examine SEC filings on Yahoo to see which principals of the company have been selling off significant portions of the stock and you will see what I mean.
If it's too good to be true... (Score:3, Interesting)
Mark my words! After SCO gets slapped around in court, Darl & Co. dumps their shares, SCO's stock price plummets, and stakeholders get all pissed off, this will end up one of the worst (and most publicized) corporate scams in recent memory.
Re:Lottery Ticket (Score:3, Interesting)
If SCO wins what?
If SCO wins their court case against IBM, which concerns a small contract dispute, they don't get that. They might get some money. That would be about it. They haven't filed any other case. Maybe you mean "IF SCO survives its counter court cases against IBM and Redhat, and IF SCO then produces some legal magic bullet which allows them to declare Linux infringing on something and IF Linux for some inconceivable reason can't simply remove the infringing code, they get liccensing fees.".
Yes, hypothetically SCO could somehow be legally awarded ownership of Linux for no reason whatsoever. But it is also just as likely that this could happen to the Disney Corporation, or the strip club downtown. Why don't you just dump all your money into campbells, becuase IF a giant meteor crashes into the earth and destroys most of the life their stockpiles of soup will be suddenly very valuable.
At any rate, this is a common misconception. SCO winning "every single linux user (if collectable, $699/installation for single-cpu installations" is absolutely not a potential outcome of this or ANY other case. Under the terms of the GPL, you can't charge licensing fees for using linux. If in order to legally distribute linux because of SCO's submarined code you must pay a licence fee, legally, YOU MAY NOT DISTRIBUTE LINUX AT ALL, because doing so would violate the copyrights of all contributors EXCEPT sco.
The best case scenario for sco is everyone is forced to move to BSD.
Re:The core of the lawsuit (Score:3, Interesting)
While I agree that it may take as long, there's also the possibility of a much faster outcome. The way SCO is acting (not giving any evidence), it wouldn't be too suprising to see the case dismissed easly. If they indeed send lame evidence, the case will go on, but everyone will see how lame the thing is and nobody will care about the trial anymore. At that point SCO might as well drop its case since the stock will be down and the bad publicity scheme against Linux will stop working. That's of course the optimistic view, but I still think it's realistic.
potential outcome, not odds, is known (Score:3, Interesting)
It seems as if the probability of SCO winning their contract case (and the implied infringement) AND the probability that they receive a significant award from the case (since they have been unwilling to disclose the nature of the specific contract breach, they haven't tried to mitigate their own damages) is being ignored or pushed off to the side. This probablility is hard to evaluate, and key to the calculation. With a lottery ticket I can at least estimate reasonably my cost-benefit ratio; with the SCO case that seems harder to do. The main benefit to SCO by winning would be the Linux user licence fees; one catch, though - these fees (charged to users who purchased and legitimately use Linux rather than infringers) would require an extraordinary interpretation of copyright law. It seems unlikely that the value derived from those fees will ever be paid, and thus a major part of the lottery winnings people who purchase SCO stock are counting on disappears.
It seems as if the odds of the lottery ticket is precisely what Wall Street doesn't know - the high potential outcome if SCO wins their case is what is seen and what drives the decision that it may be worth a lot of risk to buy a ticket. Since SCO's case seems weak (or at least it isn't emphasizing the facts of the case), SCO hasn't tried to limit its own damages, and a large part of damages (the licence fees) are not likely to ever see the insides of SCO's coffers, this seems like a bad judgement on Wall Street's part. This brings up the initial question : What are we missing here? What do SCO investors see that we don't see (and, presumably, that IBM doesn't see, either)?
Incorrect assumptions (Score:3, Interesting)
There is one theory that is widely regarded in the investment world, usually called the Efficient Market Hypothesis. It states that the stock market is efficient, that at any given time all public factors relating to a given issue (company) have been considered by intelligent investors and that the price of a company's stock always accurately reflects the value of the underlying business.
The problem with this theory is that it is utter nonsense. People buy companies based on all manner of crazy metrics: whether a certain football team won, a company seeming like a "sure bet," or some charlatan hawking the latest penny issue (that he purchased in large quantity before making the recommendation.) And price, by the way, is determined by supply and demand.
Now, that might make for a very boring story, but it is relevant in the following manner: there is another valuation model that more accurately reflects the way the stock market actually works.
It's called the Greater Fool Theory.
The definition of the Greater Fool Theory has changed over time, but a current definition is: a fool buys a stock without any sound fundamental analysis hoping to sell it at a profit to a greater fool, who expects in turn to sell it at a profit to a still greater fool. Rinse and repeat.
SCO may well have a case. I really don't know, but you all had better believe that the Greater Fool Theory played a big role in SCO's meteoric rise.
Pyrrhic victory? (Score:4, Interesting)
But what if whoever is behind this actually wants SCO to lose? Might an IBM victory actually be engineered to be Pyrrhic for Linux?
Consider that both SCO's case and the GPL revolve around the notion of derived work which is legally up for grabs. Might SCO's claim -- that all things UNIX belong to them as derived works -- get laughed out of court in a way that actually weakens the somewhat similar provisions of the GPL?
What if the goal was to downgrade the GPL to a legal equivalent of LGPL or even BSD? (The GPL hopes to make "linking" a criterion for "derived". Is SCO trying or even in a position to make such a claim and get it struck down? I don't know.)
Yes, I realize the situations are different (contract law here, copyright law there), and this hardly explains the investor frenzy on SCO. Still maybe worth keeping in mind...
Enron? (Score:5, Interesting)
Some things forgotten (Score:4, Interesting)
- patience. "we" keep forgetting to be patient
- focus. "we" got baffled with bullshit alright
- history. "we" should have *started* with looking into the USL/BSDi case. That's where it'll end and it was very predictable.
- agendas. "we" are stupid to follow the "ememy of enemy equals friend" idea. Distrust Novell. Distrust IBM. Trust me on this
But most importantly, IMHO "we" forgot "our" role in all this. "We" played right into SCOs hand with the endless detail delving. No one but "us" cares. All they see is freaky commie geeks. Of course Darl knew and knows that. He made "us" jump on command. People have rightfully called him the comic relief but to most outsiders so are "we".
So what then? Here's something: sit and wait, perhaps document what happened when if you feel the need to. Write a book about it, someone will (please don't let that be JonKatz or ESR).
Exactly (Score:3, Interesting)
Notwithstanding, they have yet to "make" money, and are only profitable due to one of the richest companies in the world. As an extension of the will of MS, their stock price deserves to be higher.
Alas, people are ignorant. When MS is finished with them, or when IBM makes them pay, or when Redhat gets their day in court, it will be a rude awakening. All insiders are selling. Its elementary.
What have we forgotten? Microsoft (Score:2, Interesting)
In the case of SCO the rich buyer skewing the market is, of course, Microsoft. Microsoft wants to keep SCO a viable company because they can use SCO as an attack dog against Linux. SCO's actions have been so extreme (I don't know how some of the SCO people can look at themselves in the mirror) that I suspect that Microsoft actually has some additional leverage over them that is not publicly known.
By the way, Apple is also a lap dog for Microsoft that they keep around only so that they can argue that they are not a monopoly.
What have we forgotten? We have forgotten (or perhaps never really come to grips with the fact) that Microsoft does not play fair, and that they are powerful enough to keep this fact very well hidden even from people who ought to know better.
Speculators vs. Investors (Score:3, Interesting)
2. Medium term speculators who can afford to lose the money and see the potential gains as worth the risk.
3. The scarcity of the public stock. It's a very closely held company.
The buyers of SCO stock aren't really investors - they're in it for the short term...SCO is a vehicle for making money and nothing more. There are plenty of examples of SCO-type speculators out there. We focus on SCO because the IP issue is near and dear to our hearts, but from a financial point of view, there are a hundred SCO's to chose from if you want to put your money into an extremely volatile stock.
"Investors", the people who look out for more than a year at a time, aren't putting money into SCO or its ilk. They're looking at capital gains, not short term income. Now, there's nothing wrong with either way of investing, but I'm not sure that the volatility of SCO's stock is any indicator that we've forgotten anything.
And, to your other comment, certainly it's worthwhile to rally around IBM, but, in the end, it doesn't matter if we're all on IBM's side or not. The court will decide SCO's and IBM's cases on their legal merits, regardless of who has the larger fan club. But I understand your sentiments...and you probably already knew all of this anyway!
-h-
Fools? (Score:3, Interesting)
People who PLAY the stock market ARE indeed fools. The only real winnners, it's been proven over and over, are the ones who buy stocks of companies that provide real value and hold on to them long term.
Re:Two factors (Score:3, Interesting)
1) The fact that SCO chose to sue for $1B, and then later decided it should be $3B, has almost nothing to do with how much they might win. A jury will decide the damages. Two things that would weigh heavily against SCO are:
One should work to mitigate the damages, if one is being damaged. It appears that SCO is not taking any steps toward mitigation of damages, on the other hand, they seem to be trying to maximize them.
The amount of code that SCO has explicitly identified in question is a tiny fraction of Linux, and the damages will probably be related to that small fraction.
SCO purchased their limited rights to Unix for around $30M, it's difficult to see how one could have damages of $1B for something that cost so little.
2) Any damage award is very likely years in the future. It's unlikely that the trial will begin as scheduled, and IBM is certain to appeal any verdict that isn't a complete vindication of IBM's position. These appeals could easily go on for many years, and SCO would see no money for that whole time. The present value of those future earnings should be discounted dramatically from the anticipated award.
3) The lawyers get 20% of the award.
4) SCO is authorized to issue 45 million shares of stock, of which only about 14 million or so have been issued so far. It's inconceivable that they would not issue that stock in the event that they win the case. This will dilute the stock by a factor of 3.
Anyway, taking all those factors into account, it seems that the current price of the stock cannot be justified based just on the chance of winning the IBM case.
thad
Stock Market (Score:5, Interesting)
There are many reasons why SCOX is rising this year. One has been mentioned a couple times already: The lottery ticket theory.
Then, once a stock is rising, it usually drags investors in. Definitely the dumb kind ("oh, it's going up. Must buy"), often the smarter kind, who plan on selling it again as soon as it shows signs of dropping.
Also mentioned already was that SCOX doesn't exactly have a huge volume, so it can be moved by fairly small trades.
And you can bet that Canopy and other investors do everything they can to drive the price up. It is, after all, part of their "net worth".
It all boils down to this: Even if SCO is doomed to fail in the end, from an investment perspective, it can be smart to buy them right until the moment said end starts to happen.
The lawsuit certainly has a much smaller impact than you think. It is easily overshadowed by the press releases and quarterly reports.
Disclaimer: I used to work for a broker, but only for a short time and it's been a while.
The future of scox according to MSN (Score:1, Interesting)
The SCO Group, Inc., a small-cap growth company in the technology sector, is expected to significantly underperform the market over the next six months with very high risk.
A repost from Groklaw (Score:3, Interesting)
Posted By: Anon
*Its become patently obvious that this entire lawsuit soap opera was carefully
planned ages ago, and it is succeeding in its primary aims. From the point
SCOG's stock became worthless, and the spreadsheet numbers were projected ahead
to reveal that SCOG was essentially dead no matter what, this project became a
no risk proposition. There is no case, there never was; the whole point of the
"lawsuit" was to waltz up to the biggest IP giant on the block and
slap them in the face, simply to get the largest shock value and the highest
possible media exposure. They *know* IBM will kill them, they also know how long
it will take this glacier to move down the valley. The attack on Linux (outside
the courtroom) is a simple red cape waved to enrage the zealous bulls in the
tech area, and provide a venue to disburse pearls of FUD *seemingly* supportive
of the bogus claims, the details of which will zoom safely over the heads of
investor-types. They will see this as a suits vs. bearded freaks issue and
choose who is making the credible claims based on that alone, and some will
invest cash accordingly. The stock is held in a way that lends itself to easy
manipulation, and they can sell THIS proposition to *outside investors who think
they are inside*, who are investing as a way to make money on the transitory
stock prices, NOT the value of SCOG as a going concern with any hope of a big
recovery. The GAME is to sustain the illusion of the stock value (created by all
the hubbubb and wild claims) long enough to pass the stock holdings from the
real insiders to the dufus outsiders, before the whole theatre folds. The method
used to carefully milk the stock prices without precipitating a sell-off is the
only portion of this drama that will require real skill, and every single day
that goes by with more stock cashed out is a complete WIN, even if there is a
good amount left on the table when the shoe drops. The Big Name Lawyer is on the
payroll to keep the Real Insiders out of prison, and encumber any assets left on
the corpse of the dead company to proxies of the principle players and the
!insider investors, he's the Elihu Root telling them HOW to do what they WANT
to do, working completely behind the scenes. The courtroom end is being handled
by a sock puppet wearing clown hair, as any money or effort spent there is a
hopeless waste of resources; maximizing the time taken for the procedural flow
is the only point of even showing up in court. The ball is rolling, now all they
need is a voice (any voice) in the courtroom saying "yeah yeah whatever,
can we have more time". There is no point in getting all hung up in the
hedgerow country of the details of ANY of SCOG's infringement FUD. If you want
to play the "you attacked Linux, prepare to die" card, the only
target of any consequence is the balancing act of the stock prices. The wind of
truth from a butterfly's wing can tip that one over the precipice, under the
right conditions. *
Note: Insiders are not necessary employed by SCO or even the holding company that owns SCO.
Dream Mine (Score:5, Interesting)
I tend to take any stock that comes from Provo with a grain of salt. Provo is the MLM capital of the world. Here is another Utah Valley company: The Dream Mine [reliefmine.com] was revealed to a prophet about a hundred years. It is not a traditional mine. The mine actually leads to the hidden vault of treasures buried by the Nephites. FYI, the Nephites were from a lost tribes of Isreal that came to America on a submarine a few thousand years ago. They got all the best treasures. But the Lamanites (American Indians) were horrible sinful creatures. They killed all the Nephites. The Nephites buried all of their treasures before the final battle.
The trick to the mine is that the secret entrance will not be revealed until God is getting ready to smite the gentiles.
This investment is great if you wish to hedge against Armagedden, and the stock tends to do quite well, despite the fact that it won't have a product until the end of the world.
Unfortunately, you have to be of the faith to own stock.
SCO is likely just another dream mine. As mentioned early, the faithful have a long history of falling for every MLM and get rich quick scheme you can name. They often get burned. Of course, if the case comes before a jury of the faithful, SCO will win big time, regardless of the merits of their case.
The Utah Court system is SCO's ace in the hole. If the jury thinks that ruling in favor SCO would make Utah Valley the new Bellevue, then they might rule for SCO. Regardless, I would be worried about shorting SCO or any penny stock from Utah, as Provo Stocks have certain irrational characteristics.
Why investors buy SCO stocks (Score:4, Interesting)
Because trustworthy information of this kind of information normally isn't available, investors make their investment decisions without first looking for "something like Groklaw".
Some investors will think "hmm maybe SCO actually has intellectual property in Linux, in that case their stock is grossly undervalued"... even if they consider the probability of that to be pretty low, it will appear reasonable to them to have a small (in relation to their total portfolio) SCO investment.
Some investors will think "I sure hope that this doesn't work out for SCO because I have investments in companies which will be hurt if GNU/Linux isn't free anymore", and they may decide to buy some SCO stock as part of a risk management strategy (to prevent unacceptable big losses in the case that an SCO victory kills GNU/Linux).
Some investors will think "Those SCO statements sound like utter nonsense to me". These won't buy, but they won't sell either - because they don't have SCO shares, and because "shorting stock", i.e. borrowing shares with a promise to give them back at a later date is difficult (impossible for small-time investors?) and very risky (even if we know that SCO stock will go down in the long run, it is quite possible that they temporarily might go up by say a factor of five for a short period of time before then, and if that's the time when you have to buy because you promised to give back those shares, you lose a *lot* of money).
The above analysis shows two categories of investors who are inclined to buy and one category of investors who are not likely to take any action.
This is consistent with the observed share prices.
The assumption that... (Score:2, Interesting)
...the investors know what they are doing is rather unfounded. Otherwise there would not have been a dot bomb where they lost lots of money. It is extremely unlikely that those investors all see something obvious that we have completely missed. In fact, I would say that it is the other way round, that the investors missed something that we know because (1) they know way less about the details of this shenanigan and (2) they are prolly blinded by greed. In other words, investors are mostly lemmings.
Cheers,
e.
Re:did you even read the article (Score:5, Interesting)
I invest in shares on a fairly minor basis and was so appalled by the boom of the late 90's (Warren Buffett: 'how are these companies ever going to make money?') that I got out altogether for a while. I missed some massive profits - as we probably all have here - but totally missed the subsequent crash as well. I finally started coming back in at the end of 2001.
The problem back then was that shares were vastly overvalued but kept on rising because they were rising. The charts looked great and pension-funds managers who pulled their funds out of these overvalued stocks were sacked shortly afterwards because their funds were underperforming.
Then came the crash and we all got burnt. That is even forgetting companies like Enron or Worldcom.
It even looks to me as though SCO have learnt from those two companies. They are filing their correct figures and their broken business-plan with the SEC. No fraud there. People who invest there will deserve all they get, the only question is the timescale.
Stock Price and Reality. (Score:3, Interesting)
There *are no* fundamentals for this stock.
SCO no longer has a product.
SCO no longer has any customers willing to stick around except for the few who absolutely need legacy software.
SCO has totally blown its future market, c.f., "we view contracts as something to use against our customers"
What has inflated SCOX's price?
1. Market manipulators painting the stock price during low volume.
2. Shills on MSNBC and elsewhere promoting the stock with bad information.
3. Darl & Co's "let's put out a press release every time the stock sags". "Journalists" eat this up and quote them in MSNBC and Forbes.
4. This is the most important one. Short interest. There is so much short interest right now that there are few stocks to be borrowed at all to short. SCOX is shorted up the ass. With no supply of stocks to buy or short, the price gets driven up.
Is the price up because anyone thinks that SCOX has any case against IBM? Nope. The discussion on Yahoo's SCOX bulletin board consists of two sides: pumpers and dumpers. The dumpers usually argue (99 percent of the time) with facts culled from Groklaw and other places. The "strong buys" are nothing but "sound and fury signifying nothing"
Those of you who are kicking yourselves for not buying SCOX in March shouldn't feel left out. This stock is only good for day traders and gamblers. The question is not *whether* the stock will tank, but *when*.
--
BMO
Re:Expected value (Score:5, Interesting)
SCO knows it won't get revenues from anyone other than Fortune 1000 corporations. They say explicitly in their FAQs that home users are not going to be asked to pay. Someone on Slashdot actually tried to buy a license, with the comic result that SCO admits the licenses are not being sold to the public at large.
If each Fortune 1000 corporation has 100 Linux systems scattered to and fro, that's about $70m. Each company would be asked to cough up $69,900 each. If SCO genuinely has a case, the Fortune 1000 companies will almost certainly cough up, since $69,900 is a tiny fraction of the legal bills they would have to confront from defending a lawsuit.
$70m in revenues for SCO is going to look pretty good, even as a one-time thing. Those are the real stakes they're playing for.
Intriguingly enough, this gives them a 17% chance of winning, or about 1 in 6.
Thoughts?
D
Re:You miss the point. (Score:3, Interesting)
We don't know what they will claim.
We don't know whether they are serious about anything.
We do know that they lie when convenient, even if they'll quickly be caught. (And even to a judge.)
We can't, by and large, do anything to prepare. Fortunately, as best we can tell there's nothing to prepare for.
Such evidence as we have seems to indicate that SCO doesn't have a case. It's not definitive, but it's certainly suggestive. (Without knowing just exactly what they'll claim, it's impossible to be definitive.)
It's a good thing to consider whether we've ignored something, but it's not good to obsess over it. The guys in charge of the code tree have probably stripped out anything that looked questionable to them, and that's all that can be done. (Outside of cheering IBM & Red Hat.)
Re:This is nothing new (Score:3, Interesting)
At the time of that trial I was unemployed. As such I was able to watch almost the entire trial. I also watched the media reports and newscasts most nights. I got 2 different impressions. I.e. Watching the trial, I was sure of an acquittal before the defense started to present it's case. Watching the commentary and news reports suggested an easy conviction.
The Judge and Jury are sitting in court. They watch the whole trial so I was not surprised at the verdict. Most people were just too busy and the media was not honest in it's reporting of the courtroom events. All but the station that simply showed the whole trial.
PS: For those who don't know what happened. OJ's team proved that he was framed. Yes it is possible to frame a guilty man and we may never know if that's what happened to OJ.
What about SCO? There are ways to drag this thing out for months or even years. Expect them to use all those ways. I.e. They will be in court this week to ask for an extension, or to present some "evidence" that hasn't been mentioned or considered before. By the time IBM, Linus and the rest are done analyzing it and proving that SCO has no claim to that code SCO will have something else.
Application Binary Interfaces (Score:5, Interesting)
Re:IBM is bigger than Microsoft (Score:5, Interesting)
In terms of employees, IBM is 6x bigger than Microsoft.
In terms of revenue, IBM is almost 3x bigger than Microsoft.
In terms of revenue per share, IBM is almost 15x bigger than Microsoft.
IBM is the worlds' largest software company, not Microsoft. It's just that IBM bundles their software w. services and hardware.
Re:This is nothing new (Score:3, Interesting)
Tell that to the people who bought at $1 and sold today. They've cashed in their lottery ticket already.
The judge (Score:3, Interesting)
Right on--SCO is speculation (Score:5, Interesting)
My father is recently retired and in the past few years has invested a portion of his savings in stocks, mainly on TSX (Toronto exchange). My father and koreth (author of the parent post) are two of very few people who seem aware of the "interesting fact" regarding stock funds performance against market indeces.
In the stock market, it seems generally to be a VERY BAD IDEA to make investments based heavily on the forecasts on market conditions and the performances of key industres and so on. My dad has had the most long term success by almost completely IGNORING trends forecasts proclaimed by the "experts" and looking at a companies current and past performance vs. its stock valuation. Some criteria are:
1. REAL assets vs capitalisation - Dad never bought into the whole
2. Is the company making money. Dad looks at the whole TSE and on the first pass he drops EVERYTHING that doesn't meed a certain PE ratio as a safe investment, REGARDLESS of what headlines they are making or press releases they are making. Dad didn't get into BRE-X for a reason--they were making headlines about a big gold find but WERE MAKING NO REVENUE YET. The find turned out to be a scam and those who gambled too long lost it all.
3. Do they issue dividends...that is a bonus...and if they do re-invest the dividends they issue back into more of the same stock. You can set it up so essentially you get shares instead of cash and you can avoid brokerage fees.
Pretty simple...and you hold everything you buy until you need to cash out or a periodic review of your investments fails to pass all your criteria. DO NOT let fluctuations in stock price--up OR down--scare you into buying or selling, EXCEPT when said fluctuation causes the stock to move outside the criteria you set as a good investment bet.
Everything else is a gamble--invest your lottery ticket money in it and nothing else.
BTW SCO fails MISERABLY as a safe investment--it fails 1. as its assets are currently next to worthless in comparison to its market valuation--and the only thing that'll change that is winning the IBM case, AND commandeering BSD since Linux users would likely move en-masse to BSD should Linux become expensive and closed. Very inlikely. It fails 2 because it doesn't make NEARLY enough revenue to pass the PE ratio test. AND because if 2. it can't do 3--pay any sort of meaningful dividend.
Re:This is nothing new (Score:3, Interesting)
the Sco example smells like criminal investigation and financial fraud. It's a shame for the US stock market and it shows that the financial markte (in the short term) may be imperfect. Strong competition law is needed for the US market, drum for FTC support.
The lawyers ruin the reputation of the United States as a center of software development and legal stability:
- DMCA
- Software patent (an institutional takeover)
- FUD against Linux
- problems of accounting: US GAAP,; perhaps International Accounting standards are an option
- anti-terror legislation
- disrespect for international law and institutions (Int. court of justice, Guantanamo, Iraq war ecc.)
Add the problems with the power supply system..., death penalty
I don't hope that the US software industry will be on the decline, I just say that the conditions for competition on this large market could be better to attract me as a foreigner to invest or work in your national market.
Re:Lottery Ticket (Score:4, Interesting)
The problem with this is that if SCO wins in court, they still do not have the right to collect license fees for Linux. If part of the Linux kernel infringes, that doesn't mean SCO owns the rest of it - at worst, they'd kill the Linux kernel, and there are replacements in the works anyway. There is no long term business here, but $1B from an IBM win would be of some value in the short term. So the PERCEPTION on wallstreet may be that it's like buying a lottery ticket... Of course the perceived value of an actual court victory would make those shares, ummm, like lottery tickets after all.
Re:SCO (Score:3, Interesting)
Anti-shorting FUD (Score:3, Interesting)
You can't just short a stock and ride it indefinitely, no matter how out of the money your short is until it comes back into the money.
Sure you can, if you do your math up front and make sure you have plenty of room to avoid margin calls. I've held shorts for over a year (for tax reasons) with no problems. But that's because I researched the margin rules and figured out my worst to best case strategies before I ever placed an order.
Making money on the collapse of a bubble is all about timing.
No, it's all about doing the math. You're almost always better off taking the time to do your homework rather than trying to time the market, with the possible exception of no-brainer arbitrage oportunities.
-- MarkusQ
Re:Dream Mine (Score:5, Interesting)
It's a sucker's bubble. Basically, what the anti-SCO press is missing can be found at GrokLaw.
You have to understand something very simple:
1. There are very few people in SCO's pool of stock compared to other small cap investments.
2. A majority of that stock is held by institutions and these institutions are known for quasi-legal and illegal practices - just like Canopy.
3. Because of 1 & 2, the ability to control the price of the stock is greatly enhanced, and so long as Baystar, RBC, Renaissance Capital and others feel the need keep the price up, no amount of shorts will affect it for very long. There will not be enough shares out there to make it happen - they've seen to that.
I tend to take any stock that comes from Provo with a grain of salt. Provo is the MLM capital of the world. Here is another Utah Valley company: The Dream Mine was revealed to a prophet about a hundred years. It is not a traditional mine. The mine actually leads to the hidden vault of treasures buried by the Nephites. FYI, the Nephites were from a lost tribes of Isreal that came to America on a submarine a few thousand years ago. They got all the best treasures. But the Lamanites (American Indians) were horrible sinful creatures. They killed all the Nephites. The Nephites buried all of their treasures before the final battle.
The trick to the mine is that the secret entrance will not be revealed until God is getting ready to smite the gentiles.
Well, you are half-way correct about the Dream Mine, but we'll save that for another conversation because the topic itself leads people to think you've lost your marbles using this as an example.
Utah Valley Mormons have got to be some of the most gullible people I have ever met. Faith has nothing to do with it. It's the wide-eyed ignorant bliss that comes from ignoring the rest of the world in the hopes that it will go away.
This leaves sharks like McBride (who was a putz back at BYU when I was there) to prey on the "innocent" using the Church and the Utah culture as a backdrop to Rape, Pillage, and Burn his way through everyone's money. In Wall Street circles, that's know as Standard Operating Procedure. And for that you get bonuses, accolades and a chance to do it again.
I think the word you are looking for here is Gaddianton.
Pump & Dump (Score:1, Interesting)
Better yet, look closely at the penny stock market. I learned (the hard way) about pump and dump schemes up front and close - enough to earn the t-shirt "I sold my company for $10 million and all I got was this crummy t-shirt." SCO's gameplaying is quite impressive, compared to the dozens of schisters I've met in the penny stock market, but the strategy is the same.
1. Obtain control of an essentially worthless publically trading shell or company.
2. Issue major amounts of stock to your group. This can be done through acquisitions of worthless private corporations your friends own (XYZ Corp acquired by EmptyShell, terms not disclosed - kind of thing), through issuing of warrents/options, etc. Lots of ways to load up.
3. Start the PR spin on why EmptyShell is going to be the next big thing. This often is done with acquisition, though increasingly it's done with the threat of litigation. Look at Leftbid and its bogus claim [siliconinvestor.com] of owning patent rights to the technology used by Ebay. The Leftbid organization was an empty shell, run by an individual who controlled over a half dozen such shells. While Leftbid and all the other shells are dead (and over $100 million in creditor claims ignored from all the companies this fellow has run), this fellow pocketed over $30 million in less than ten years.
4. Pump releases to PR Newswire, BusinessWire, etc.
5. Dump shares as the stock moves up.
6. Reload/repeat until the shell is worthless, creditors are closing in, investigations going, etc.
7. Dump any assets the company has, illegally if necessary. Creditors will go away if there is nothing to collect. (The funniest trick here is to find a shill within one of the operating companies to put everything in their names. Have them sign the checks, list them on the payrolll filings as manager, and even give them a big promotion as you're wiring all the money to that Bermuda account. When the investigators come, guess who they'll pin the payroll tax liability and other matters on? Not you! Best of all, it'll take these pour fools countless thousands of legal bills to fight off the IRS while you're sailing on your 25 meter ship)
8. Ignore courts, lawsuits, and investigators. Stall, lie, claim you were just another investor who "lost millions" and was taken like all the rest. Claim all the company documentation got lost in a fire or sent to a warehouse and nobody knows where it went. Laugh at the Enron fools who didn't burn the documentation fast enough.
9. Brag at the local country club that the FBI, IRS and SEC can't touch you. (Being on the other side of this, I'm afraid it's right. We were repeatedly told by SEC officials that we should complain to our congressperson because the SEC was underfunded and couldn't investigate all these smaller guys. FBI's response was "we're not a response agency. IRS asmusingly went after the small fry it could intimidate and weren't smart enough to obtain legal representation, in spite of piles of documentation provided that pointed to the crooks. Path of least resistance).
Promises are made that SCO will be buried and that McBride will find himself in prison, yet they are still there and McBride is still in charge.
And this will not change. Don't be fooled by McBride's tech stupidity. He's paid his dues to the system by hiring David Boies, and Boies has already greased the political skids. When David makes money, the pols make money. Surprised that Hatch's name comes up? Why else do you think they hired Boies, if not for his party connectedness (and don't assume for a second that either party has a monopoly on this game).
The men and women who play the stock market on a regular basis are no fools
This was the hardest thing to learn: there are a large amount of folks who know the game being played. Their greed drives them to pile on to the game, hoping they'
Re:"Many eyes" (Score:3, Interesting)
1) That SCO has found their source code in source code published online that anyone can download and
2) that SCO's release of other people's copyrighted work (e.g. Linux), required to be distributed under the GPL, doesn't mean any SCO code in Caldera Linux has been released under the GPL.
Now, 90% of the people who are making calls on this stock couldn't give you the definition of "source code" if their lives depended on it.
#2 is less of a technical issue, but unless there's some really goofy clause in the law somewhere, any moron can figure out:
1) Either the GPL is invalid and they're distributing works illegally OR
2) They're releasing their own source under the GPL (assuming there is some in Linux).
There aren't any secret tricks or hidden messages or conspiracies, there aren't any facets here of "Hey, just maybe, we're wrong." This is as cut and damn dry as a lawsuit can get. SCO is trying to take Linux's cake and have and eat both it and their cake at the same time.
I applaud those of you who are trying to be humble and suggest "we might be wrong" -- we might be. But I honestly think some of you are taking this "there are no easy truths" crap way too far.
Cheers
Forgotten? (Score:3, Interesting)
We in North America live in an era of crypto-fascism, where a shareholder will proxy his vote to put a bullet through a baby's head, just to get another dollar of share price.
Nitpicks (Score:5, Interesting)
The submariners were Jaredites, who supposedly came straight from the Tower of Babel. Nephi and friends just had an unremarkable ship. Also, in the traditional interpretation the Lamanite ancestors all came on Nephi's ship; it wasn't until people examined Native American DNA that the idea of unmentioned Siberian-descended Lamanite groups became popular.
The Utah Court system is SCO's ace in the hole.
Not yet, it isn't. Judge Wells certainly doesn't seem to have a pro-SCO prejudice, and at the rate the McBrides are going the case may never make it to a jury trial. Even if it gets that far and SCO's lawyers somehow manage to get a biased jury, Novell has as much of a "hometown Utah company" appearance as SCO does, and based on their statements and copyright filings Novell looks like they're going to bat for our side.
Regardless, I would be worried about shorting SCO or any penny stock from Utah, as Provo Stocks have certain irrational characteristics.
I'd be worried about shorting SCO because every stock (especially every thinly traded stock) has certain irrational characteristics. If there are suckers out there who will pay $20 a share for SCO, how do I know there aren't suckers who would pay $40 a share?
facinating idea. That may be why the price is up! (Score:3, Interesting)
So in that case, investing in SCO is like buying insurance on your investments in companies who's fortunes are related to open-source.
SCO's share price is still really cheap compared to the value that they would get if they won their suit. So if I owned a ton of shares of Redhat or SuSE or IBM (for example) I could purchase a smaller number of SCO shares. If SCO wins the suit, I wouldn't lose any money!
If SCO loses the suit, the money would pretty much go to zero, but that's no different then what happens to the money you pay for car insurance if you don't get into an accident.
So no one thinks SCO will really win, they just want to be covered in the event that it does.
Re:This is nothing new (Score:3, Interesting)
Sure, buying SCOX stock based on the Linux lawsuit is a lottery. Happy now?
Some people get rich in the lottery. Jackpots of over 20 million or won every few months by someone. Some go as high as 200 million and are won. It is still a lottery. You might win, but it isn't a good way to play stocks.
There are stocks worth buying. Fundamentals count. Read those anual reports (not the glossy paper parts, the cheap paper with all the numbers on it), and understand it. Compare that company with all the others in its industry and figgure out what it is worth. Warren Buffet made a ton of money this way, so it can be done. It is hard work, not a get rich quick scheme.