LoudCloud

Case Supplement

 1. What product does LoudCloud sell?

Develop services and software that would help enterprises build fast, reliable e-business infrastructures (data center automation software).

2. What are the two most important things going for LoudCloud; things that help to assure success?

A) GAINING CUSTOMERS- The outsourced Web services appear to be gaining traction among large customers, a key component in attracting other large-paying customers.

B) REVENUE IS GROWING- the company said that as of January 2001, it had contracts worth $120 million that spanned an average period of 1.8 years.

3. How did they do?

The company was bought, and is now called Opsware.  The company reported net income of $49.1 million, or $0.65 per share, which includes the gain on the sale of the managed services business, which was sold to EDS for $63.5 million in a cash transaction that closed on August 15, 2002.  Results for the third quarter include approximately two weeks of operations of the managed service business, including $2.6 million in revenue.

4. Make a prediction about their strategy and products in the current economic environment; will they succeed, fold, barely survive, thrive, etc.?

I believe they will pretty much thrive.