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Dennis Byron

 
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  • Microsoft: NYT Article Misleads Investors [View article]
    Thanks for all the comments.

    Here is a clarification and a further comment:

    Clarification:. I would have been more accurate if I had said near the beginning "Apple does not embrace open source terms and conditions any differently than Microsoft, IBM, Oracle, etc." The point here, as I say at the end of the post, is that open source iissues are meaningless as IT investment factors: all the big boys have co-opted the movement to their own devices and for their own reasons. This is a blog post and not an article but I still could have thought that sentence through one more time before hitting the button.

    Comment: Despite all the impassioned discussion pro and against Apple's open source terms and conditions and Microsoft's share value (I flatlined Microsoft's share value in 2008), the only reason I wrote the blog post -- as it says in the headline and in most of the post -- is that the NYT article is misleading. It never identifies Tim O'Reilly fairly so that investors understand the incredible biases in the article.

    Thanks again for the discussion

    Dennis
    Jul 6, 2010. 06:23 AM | 9 Likes Like |Link to Comment
  • Managing The Medicare Maze In Retirement [View article]
    This article on Medicare is misleading. (I also think it's way off point for an investment site that I used to visit often before I went on Medicare... but that's neither here nor there.)

    In particular the illustration on the "Medicare Maze" above has multiple errors. I agree Medicare is a maze but Medicare Advantage -- at the upper right -- is NOT "private insurance approved by Medicare," as the illustration says. It is actually a full-blown "Part" of Medicare just like A and B. The description "private insurance approved by Medicare" would be better applied to Medigap -- at the lower left although the whole private/public thing is meaningless.

    In fact, all "Parts" of Medicare — A, B, C and D — are public in the sense that they are run by the United States government’s Centers of Medicare and Medicaid Services (C-M-S). And they are private in the sense that the CMS uses private insurance companies to administer them. This should be nothing new to the typical SeekingAlpha reader of Medicare eligibility age. Unless you worked for a very small company or a risk-averse large company or insured yourself and your family directly before you joined Medicare, this is probably the way your health insurance has always been run and administered. Most large employers self insure and hire an insurance company to handle the administration. In the case of all Parts of Medicare, that’s what the U.S. government does.

    But for partisan political reasons in the U.S (which I am not accusing the blog post's author of),, Original Medicare (Parts A and B) are often called public and Medicare Advantage (Part C) and standalone prescription drug plans (Part D) are often called private. It is especially important for seniors and those about to sign up for Medicare not to be confused by this political posturing because there really is no choice between public and private involved. A and B are required for C and most of the time for D.

    In some regions of the country, different private insurers handle Parts A and B enrollment, claims, fraud and abuse investigations, payment processing, and similar insurance company administrative functions. In other geographic regions, one private insurance company handes all the related administrative functions. If you want to really be confused, here is the “simple” 7-page version of an explanation put out by the CMS “as a service to the public and not intended to grant rights or impose obligations” (see http://go.cms.gov/tcTaLK).

    Rather than the three steps outline above, Medicare beneficiaries do have a choice among three supplemental Medicare options. Nationwide, over 90% of us choose a supplement (mostly one of the following three) because Original Medicare is not very good insurance:

    -- Employer-sponsored health insurance (E-S-I) for retirees – fewer and fewer employers offer ESI to retirees but if your former employer does, it’s typically the best of the three supplemental options. Still the employer will usually require you to sign up for Medicare Parts A and B and — if it hasn’t already done so – the employer might drop its retiree drug coverage so that you will want to sign up for Part D. And the retiree ESI plan might be more expensive than buying supplemental Medicare insurance directly — see next two options — after comparing benefits. Retiree ESI is typically regulated by the state insurance commission where your employer is headquartered.

    -- MediGap – MediGap is highly CMS-regulated but not officially a Part of Medicare. There are as few as two and as many as 10 types of MediGap insurance available depending on the state you live in. You have to sign up for Medicare Parts A and B and because MediGap policies do not include drug coverage, you shoud sign up for a D plan.

    -- Part C — Medicare Part C, also called Medicare Advantage, is effectively a bundle of a MediGap and a D plan, usually but not always implemented as an HMO. As I said, Part C is just as much a Part of Medicare as Original Medicare Parts A and B, and both A and B are required before you can sign up for a C plan. The government providing Part C as a choice to Medicare beneficiaries is similar to your former employer providing an HMO as an alternative to a traditional health insurance plan before you became a Medicare beneficiary. Twenty five percent of Medicare beneficiaries currently choose C plans. The downside is that most have the perceived disadvantages of any HMO (limited geographic coverage and networked providers).

    (NOTE: There are also some legal primary/secondary recourse aspects of the terms private and public but it is highly unikely that those aspects wil matter to you — as the Medicare beneficiary. If you are concerned about this sort of thing because you have a complex Medicare situation, read the fine print and contact the relevant insurer and/or Medicare. Or contact your local senior center and ask for Medicare help.)
    Dec 5, 2011. 08:55 AM | 2 Likes Like |Link to Comment
  • Is Red Hat Just Like IBM, Microsoft, Oracle, Salesforce and SAP? [View article]
    I am not sure what obtuse open-source-zealot point that Carousel and User 65886 are trying to make but for those who are interested in Red Hat and this subject from an IT investment point of view, here is a description of the Red Hat business/revenue/sales model from page 42 of its 10-K:

    "We sell our enterprise technologies through subscriptions, and we recognize revenue over the period of the subscription agreements with our customers. In addition, we generally provide certain managed services for each of our enterprise technologies... as a component of our subscriptions... We derive our revenue and generate cash from customers primarily from two sources: (i) subscription revenue and (ii) training and services revenue."

    In other words, as I said, its model is just like every other enterprise-software company's. When I said "last time I checked," what I meant is that I did not know if Red Hat had added a SaaS option. It appears not to have according to its SEC filing.

    Dennis
    Oct 22, 2010. 08:49 AM | 2 Likes Like |Link to Comment
  • Managing The Medicare Maze In Retirement [View article]
    @ joe eqcome

    Sorry but let me help you with your facts. I am certified by CMS on this subject. Read my post carefully vis a vis private vs. public and supplemental options.

    In addition, although the chart is sort of "based on" the illustration on page 15 of "Medicare and You," you or someone purposely doctored the illustration in the official booklet and in the process introduced signficant errors. You are confusing seniors with inaccurate information (not that anyone would turn to this web site for information about Medicare).

    I take part of my earlier comment back. I guess you do have a political agenda.
    Dec 5, 2011. 01:54 PM | 1 Like Like |Link to Comment
  • 'Death of the PC' Is Premature Prediction [View article]
    I haven't done the math lately and I am on the road but look at the 10-K and make sure you include both classes of shares. Even if it's "only" 80% these days, my opinion is the same. But I think EMC still owns close to 100% of the voting power of VMW

    -- Dennis Byron
    Dec 17, 2010. 01:32 PM | 1 Like Like |Link to Comment
  • Is Red Hat Just Like IBM, Microsoft, Oracle, Salesforce and SAP? [View article]
    Aviso

    Sorry you are wrong on a lot of fronts but particularly on the statement that the "author has not researched" the subject. In fact it is my research that is quoted on the Linux Foundation web site comparing Vista and Fedora 9 as noted in my November 2008 blog post on my IT Investment Research website (see www.linux-foundation.o.../ referencing my post at byrondennis.typepad.co...). Fedora 9 from two years ago became RHEL 6 last week I assume (although I admit I didn't call Red Hat to confirm that).

    The point is that real-people investment research (as opposed to open source propaganda) clearly shows that from the demand side, Red Hat's sharing of development costs with IBM, HP, etc. via the Linux Foundation and similar organizations these leading enterprise software suppliers fund, administer and populate with programmers is not a business model, just a good tactic for all involved (now including even Microsoft vis a vis Apache as our 2006 research indicated would happen). Red Hat depends on the tactic more than the others but that is not a business model.

    Hopefully you are not an investor Aviso so no harm, no foul. Real investors, beware of this propaganda and make sure you are getting the facts.

    Dennis
    Nov 17, 2010. 10:37 AM | 1 Like Like |Link to Comment
  • Is Red Hat Just Like IBM, Microsoft, Oracle, Salesforce and SAP? [View article]
    Thanks. There are a lot of good comments here, so much so that I might do a future post. But I just want to repeat my warning to casual readers that very little of this is actionable IT-investment-related research, just a philosophical debate (that is pretty much over) among certain software developers. That is the reason some of the commenters are arguing with each other, and not relating the issue of open source terms and conditions to investing.

    In particular, there is an argument that Red Hat is somehow better than IBM for some philosophical reasons only understood by the debaters somewhat tied to support for open source development communities and culture--as opposed to terms and conditions. There is no doubt that Red Hat is demonstrably 100% so tied (hence the term "gotcha" in my original post) but in absolute numerical support for open source (man years or dollars), no one comes close to IBM.

    Dennis
    Oct 27, 2010. 02:06 PM | 1 Like Like |Link to Comment
  • Is Red Hat Just Like IBM, Microsoft, Oracle, Salesforce and SAP? [View article]
    KimTjik

    Thanks for the thoughtful comment. Yes, I do "narrow it down to the actual transaction of money and service." This is an investment-research web site, after all.

    However, I make that determination based on extensive demand-side research that says that no one buys software because of the open source philosophy. That's the reason that Red Hat is the last man standing after the acquisition of MySQL, Zimbra, etc. etc. and even Sun (making a stretch I don't even agree with myself but a lot of people wanted to call Sun an "open source" company before Oracle acquired it).

    From an investment perspective, open source is simply a set of about 100 license terms and conditions (that number and the wide restricitive-permissive spread of those Ts&Cs is part of the problem for investors). Almost all the software-market leaders make software available under one or more of these diverse Ts&Cs and all of them adhere to such Ts&Cs in their own development efforts.

    Of course Red Hat allows "a clone, like CentOS, to coexist." That's part of the Ts&Cs it chose, effectively no different than what IBM does with Gluecode, Progress does with Fuse, etc. Are their business models different?

    When you say "Red Hat... honour(s) the mindset of open-source. I don't know of any actions by Red Hat that have worried the open-source community...", it implies that you are not interested in the investment aspects of these different companies' strategies, but only philosophical issues.

    That's OK. Open source is like the Elks or the Moose or the Shriners. A great fraternity (and it does still appear to be a fraternity) but that has little to do with why someone should invest in those companies that use its Ts&Cs.

    That's why "I reject 'open source' as an enterprise-software business model or sales model category." From an investment point of view, it's just legalities.

    (Over 1000 pieces of my research on this subject -- open source from an investment perspective -- are available on line if you want to dig deeper.)

    Dennis
    Oct 22, 2010. 12:26 PM | 1 Like Like |Link to Comment
  • SaaS Just a Sliver of a Splinter of IT Spend [View article]
    Alisadat

    Lightway defends my point of view better than I could defend it myself, particulary the business process aspect that keeps users from changing software (or SaaS) often.

    But to correct one impression you seemed to get from my post, I did not say technologies are the same as 40 years ago. You are reading something into my comment to Kevin that isn't there. I don't mean to be picky about that misreading but a genuflection to technology is the biggest IT investment risk: the end-user IT market decision is rarely made on a technology basis so IT investment decisions should not be either. If you see a technology angle even when it isn't there, you might be prone to making that sort of investment decision.

    Thanks for the discussion

    Dennis
    Sep 28, 2010. 09:50 AM | 1 Like Like |Link to Comment
  • Enterprise Software, Cloud, SaaS and Open Source: Not Separate Markets [View article]
    Kevin, thanks for your comment even though I am about to disagree with you totally.

    First of all, I am not replaying the "old-line analyst" opinion. As the picture shows, I am the old-line analyst. I have been saying this for 20 years. (However, I make a subtle distinction: I am an IT market researcher, not an analyst in the sense I think you mean: I have not been the type of analyst that gives users advice since I left Datapro.)

    When I started in IT marketing 40 years ago, SaaS was called timesharing, then service bureaus, went through a few more iterations and by about 1999 was called application service provision. I am not proud to say that I participated in coming up with that term. We had the numbers right at IDC back then but basically too much hype got generated over what we clearly said were low numbers as a percent of total market spend (as I mentioned in my article above).

    There is nothing new about SaaS as a business model or otherwise although some market researchers looking for differences (which is good; that's their job) parse things -- like multitenancy and whether the software is exclusively available as a service or also available under a perpetual license -- to see if there are differences. But in the end, the difference is so minimal as to have little effect on market dynamics. The user is going to pay x over seven years for y functionality. It doesn't tend to matter a lot whether the user pays 5% of x on day one -- the licence price -- and then the remaining 95% monthly over the next 84 months -- the subscription maintenance to keep tax tables, etc. up to date, the hardware costs, and most significantly the personnel costs. Or whether the user just spreads the whole 100% out over the 84 months.

    I don't get the "SaaS products are like Facebook" thing at all. I know you are parroting the Marc Benioff party line but as I went into in detail in February 2010 (see byrondennis.typepad.co...), that's just good PR. I complimented CRM for it.

    I am not sure which software suppliers you mean by "best in class" firms but as I explained last year (see byrondennis.typepad.co...) the only difference between IBM, Oracle, etc. and the so-called SaaS pureplays is that the latter are not really pureplays. All began trying to sell their software via a perpetual license and failed. And conversely, Oracle may already be second only to CRM in SaaS revenue (and if not, it will be within a year or so to be followed, depending on corporate strategies by SAP, Microsoft, Intuit and possibly -- although it's a special case because of its mainframe business -- IBM).

    All the indisputable market research issues aside, as I said in my article above, "I believed then and still believe that SaaS will again become a dominant enterprise software delivery method, just as it was when I entered the business 40 years ago." It's just that that trend has nothing to do with a different business model, Facebook, different sales or marketing techniques, technologies, or pureplay vs. stack.

    Thanks again for the comment
    Sep 24, 2010. 01:23 PM | 1 Like Like |Link to Comment
  • Why Should Oracle Even Bother with the EU? [View article]
    Thanks

    You are referring to Oracle's statement, which it issud in response to the EU Statement of Objections adn filed with the SEC. I was trying to get the actual document that the EU gave to Sun but the EU says such documents are not public (but someone--probably SAP--will leak it).

    Dennis


    On Nov 12 09:11 AM reyito wrote:

    > Dennis,
    >
    > The EU's statement can be found in Oracle's 8-k filing.
    >
    > Keep up the good work.
    Nov 12, 2009. 04:03 PM | 1 Like Like |Link to Comment
  • 'The Shallowest Generation': A Rebuttal [View article]
    Wow! I didn't realize from the earlier insults that you were the same person that wrote the original article. I have never seen anyone write under one name and comment under another.

    But now I understand. Unable to prove even one of your points about Baby Boomers, you insult others who call you out on your lack of logic.

    Oh, and you should carpool if you're commuting 120 miles a day--save the planet!

    Dennis

    On Nov 08 02:28 PM JGQ wrote:

    > Hey Dennis
    >
    > Pretty touchy for someone who used the words: rant, blabbers, and
    > screed in his attempt to get someone to read one of his articles.
    > How does it feel to leech off of me to get someone to read your blather?
    > I hope you don't have to rely on your ability to write in order to
    > make a living. Let us know what kind of car you drive? How many miles?
    > Leased, bought, or did you remortgage your house for a Mercedes?
    > Why weren't you able to save enough to put your kids through college?
    > I have been saving since my kids were born. I won't be borrowing
    > to get them through college.
    >
    > Wah Wah Wah. That's abuse. Classic boomer.
    Nov 8, 2008. 03:09 PM | 1 Like Like |Link to Comment
  • 'The Shallowest Generation': A Rebuttal [View article]
    Most important, to Axelrod-Glad you got the humor.
    --------
    To the guy (or girl) who doubts the Social Security numbers, go back and read how SS works (and I am not counting my Medicare contributions which I do fully expect to recoup). As I think Buffet or someone of that net worth says, most of you pay the same as I do in SS taxes. You did not have to be "highly compensated" over the last 45 years to have that kind of money "deposited in your account." You just have to be middle class depending on how that's defined.
    --------
    To elcopone, if that was Quinn's point, he never said it anywhere in multi-thousands of words. He said:
    1. ) "Our claim to fame is living way beyond our means for the last three decades, to the point where we have virtually bankrupted our capitalist system."
    and
    2.) "Of course, not all Baby Boomers are shallow, greedy, and corrupt. Mostly Boomers with power and wealth fall into this category."
    He provides no proof for either statement, which is the reason I wrote the rebuttal over on this part of the site (I actually write about technology investments and related issues).

    But to answer your question despite your insult, personally I believe volunteering in non-partisan local government and non-government charitable organizations is a means. That was my choice for 30 years but I don't contend that it is the only means to contribute back to society. Military service, teaching K-12, and social work are careers in this area. Coaching kids sports, elderly services, and working with the disabled are great volunteering opportunities.

    Those who attack the Baby Boomers might want to find out how are age bracket does in these areas.
    ----------
    To those of you who have been genuinely disturbed by and thoughtlfully replied to the original article's premise that the Baby Boomer generation is responsible for the financial crisis, note that the orginal author is missing in action. My contention is that there is no data in his multi-thousand-word article that connects demographics with the broad economics discussed here or that relates to the orginal author's specific claim (that greedy baby boomers, not all baby boomers mind you, did such and such).

    I pointed out how two of his statistics are demonstrably wrong (or at least misleading)--(
    1) where the "greatest generation" got its "wealth" and
    (2) the candard about savings rates.
    I'm still waiting for any other proofpoints linking generations to all the ills of society; I doubt if they exist at all but they definitely were not in the original article.
    ----------------
    To the ad-hominem attackers, I would like to see SA management delete all such attacks as being below the purpose of this web site but the Internet being what it is, SA would probably go broke trying to do it.

    But to the lowlife JCQ, as the "More by Dennis Byron" below indicates I write for a living on the Internet so I'm used to profanity and people who can't think through what they are writing calling me "idiot" or making some insane connection to Todd Palin. But attacking my children is a new low in incoherent Internet idiocy. Your comment is totally ad-hominem and should be reported as abuse.

    Dennis


    Nov 8, 2008. 10:54 AM | 1 Like Like |Link to Comment
  • Government wants to cut Medicare Advantage payments by 3.55% [View news story]
    Part C plans get cancelled every year and new ones start up so your problems are not necessarily President Obama's fault. The big changes in Part C in 2014 that I have seen so far because of the Patient Protection and Affordable Care Act is reduced benefits, not higher premiums (e.g., raising the annual OOP limit, raising co-pays). You can expect more of that in 2015 plus higher premiums and more of the restricted networks that are getting some publicity in Connecticut. They way PPACA affected you (more than $150 a month) seems quite rare.
    Feb 25, 2014. 08:18 AM | Likes Like |Link to Comment
  • Government wants to cut Medicare Advantage payments by 3.55% [View news story]
    As I had figured, UnitedHealth and Humana both announced Monday Feb 24 that the "cuts" (which aren't really cuts as explained above) were not as bad as the two insurance companies had originally projected. UNH and HUM said that was because of something in the fine print of the 150 page document (that I didn't see) about getting more money from relatively healthier baby boomers coming onto Medicare in 2015 in even greater numbers (the people born in 1949 plus the people born 1946 to 1948 who deferred Medicare because they kept working until their SS kicked in full). I think they probably mean that the pool is just actuarially getting less costly (but that will only last a few years).

    And as I said Sunday: "The same insurance companies sell both types of policies (and many of them also make money running the Original Medicare program for the government). The insurers make money no matter what happens."
    Feb 25, 2014. 08:12 AM | Likes Like |Link to Comment
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