Vignette Pays Price for Annual Repositioning

Jan. 7.09 | About: Vignette Corp (VIGN)

Vignette (VIGN) may be just the first of a long line of enterprise software suppliers to pre-announce (and then formally report) very bad year-over-year and quarter-over-quarter compares. Or it might be the poster child for losing out in the enterprise-software market by changing positioning almost annually.

On January 5, Vignette said--on a preliminary basis--that its quarter 4 (Q4) 2008 revenue would be down 32% vs. the same quarter on 2007. Worse, its Q4 license revenue would be down as much as 60% in the same compare.

Although I don't expect any enterprise software suppliers to ring a bell over calendar Q4, these numbers also are the result of a decade of Vignette changing positioning, most often without even changing the products on which the position is based. Follow the bouncing ball as represented by the opening sentences of each year's Vignette 10-K (date of publication; refers to previous fiscal):

  • 2000--Provides ebusiness applications

  • 2001--Provides customer-driven Internet applications

  • 2002--Provides content management software

  • 2003--Provides content management and portal software (via acquisition)
  • 2004--Adds process to the other two for the first time
  • 2006--Process becomes workflow (going backwards in terms of industry use of buzzwords)
  • 2008--"The web experience" (i.e., Web 2.0)

Of course this confuses the hell out of investors. But imagine what it does to potential customers.