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Geronimo!!! From Crazy Bear to Sitting Bull

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Geronimo!!! From Crazy Bear to Sitting Bull Powered By Docstoc
					January 2003 – The TMT monthly

Geronimo!!!
From Crazy Bear to Sitting Bull
Andrea Kirkby, TMT Analyst
                                                          If you have been forwarded
When one of the most bearish of tech analysts             this copy and would like to
suddenly turns bullish you might get worried. When        subscribe, simply send a
it happens in the midst of doom, gloom, and               blank e-mail to
confident expectations of a housing market crash,         tmt@hardmanandco.com and
you might well reach for the telephone to call the        you will receive all future
men in white coats before it’s too late.                  editions of the TMT Monthly.
Besides, the papers have recently been full of
negative stories. For instance, Goldman Sachs has
carried out research on CIOs’ spending intentions which demonstrate that growth in IT
spend at a majority of firms is expected to be less than 5%. So the IT industry has
definitely gone ex growth. But what struck us as interesting about the Goldman figures
was that last years’ figures showed much greater variance, with more firms expecting
savage cuts and more firms expecting higher growth – this year there’s much more of a
consensus on broadly flat spending. That seems to us a much better base and suggests
there could be less volatility in prospect over the course of the year than was the case in
2002.

In any case, a company does not have to score double digit top line growth to be
attractive. There are other reasons to be cheerful;
    • Nil or low top line growth can turn into significant profits increases as costs are
        cut. We believe this will help out many tech and media companies this year.
    • The last two years have seen major declines in revenue, with quarter on quarter
        comparisons getting worse. We believe this year the comparisons will be much



                                              1
       easier. In advertising, for instance, Granada, Carlton and some industry
       commentators now think we’ll see growth in ad volumes next year – though it
       will be low.
   •   There may not be a “next big thing” but we disagree with Martin Butler –
       technology doesn’t need a next big thing. What’s actually happening is that
       technologies that were sexy a year or two ago are now finding practical
       applications and are in many cases being sold through a services framework to
       create recurring revenues. Many technologies are also filtering down from the
       Fortune 500 to medium sized companies.
   •   Substantial capacity has been taken out of the market. A case in point is financial
       web sites – UKinvest, The Street.co.uk, and numerous other sites have closed
       down over the past two years. Not only is there ‘no such thing as a free lunch’
       with sites such as Citywire and Moneyguru charging for access – even if you want
       to pay for it, there are fewer restaurants.
   •   There are great opportunities for companies to grow by acquisition right now. It’s
       quite difficult to acquire a company on a PER in single figures and not make it
       earnings enhancing (though we have a short list of companies who probably could
       manage it…)
   •   The bond yield / equity reverse yield charts give some real support to the market
       at current valuations. And though some dividends are being cut, in the tech and
       telco sector we’re actually seeing rather more being resumed, plus maiden
       dividends from some software and services companies and youthful media
       players.
   •   The whole tech sector now appears to account for less than 3% of the market even
       after the rally in Q4. In terms of market weighting it wouldn't take a lot to boost
       valuations quite a bit higher.
   •   For technicians – the FTSE chart actually looks to us as if it might be forming a
       decent double bottom, with the next move up to 5,250 once it’s got through 4,300.
       As long as it doesn’t tank below 3,600 in the meantime.

Last but not least, we detect a swing from the consumer economy to the capital
economy. We’re more than a little amazed that every other journalist and investment guru
has picked housebuilders as the sector to buy this year. To us, a bearish view on the
market as a whole and buying Bellway is far more deserving of the men in white coats
being called than turning bullish of the market. (After all, it has to go up some time.) It’s
obvious that retail is on its last legs – Christmas was pretty dire and the sales didn’t wait
till January to begin – and house price rises are now decelerating (and will fall, at least in
London). Pubs in the south east are shifting less beer. The consumer economy was the
mainstay of the market last year – while capital goods have been underperformers for two
years.

Now, most people are betting that with the consumer economy in trouble, the whole
edifice will come crashing down. That still seems possible. But first of all, fund managers
can't (unlike private investors) go 100% cash. They therefore have to find the sector that
will outperform, even if it’s going to fall in absolute terms. Funds flow therefore dictates
that capital goods firms will get more investment.


                                              2
Secondly, we carried out a little exercise in December and tabulated the capital
expenditure of major European telecoms firms per quarter for the past three years. We
actually started out doing so to prove our bearish thesis. Surprisingly, it didn’t. Telcos’
capex fell dramatically from about March 2001 to late 2002 – but in Q3 2002 it actually
appears to have ticked up for the first time in seven quarters. Too early to call a turn
perhaps, but it really doesn’t seem to be getting worse. While it’s difficult to see what
will really impel hardware back to 2000 and early 2001 levels of spend, any telecoms
equipment manufacturer which has a substantial amount of replacement business could
start seeing revenue comparisons looking reasonable from here on out. A two-year
squeeze on networking investment by most corporates also means many companies are
now working with outdated (hence, slow) equipment – yet we know they’re running
more, and more complex, software on it. Thus though we don’t see XP as a compulsory
upgrade (like 16 to 32 bit, for instance) we believe there is still, probably, pent up
demand for higher spec replacement PCs. It might be worth remembering that most
companies depreciate computer kit over three years – and with a two year tech spending
squeeze, they’re bumping up against useful life on most of their IT. We don’t anticipate
huge growth in the market, but very modest revenue growth (or even in some sectors an
end to the decline), given the staff and cost cuts in the hardware sector, could give us
some interesting plays on improved margin.

There may be some correction first – tech performance in the last quarter of 2002 in some
cases ran a way ahead of the fundamentals (thinking mainly of the hardware sector here).
But over the course of the next twelve months we expect to see some strong investment
stories in the sector.

By the way – Crazy Bear? Yes, he was a member of the same tribal council that made
Crazy Horse a chief. A Lakota Sioux for those of you who really want to know.


Faites vos jeux

We are not dumb enough (quite) to make a sector call for either tech or media. We
believe that there are areas that will recover really well, and areas that won't. There are
some subsectors that are very reasonably valued and others where recovery is more than
adequately discounted. So we’re again going to pick our favourite, and least favourite
areas within the TMT sectors. Stockpicking will remain a key factor in performance this
year – so will the ability to move nimbly between sectors and to book profits at the right
time. (In a way, doing a ‘tips for 2003’ at all is the wrong thing to be doing – we hope
that on at least some of these ideas we’ll be seeing a decent return within six months and
be able to move on.) More detail follows below on some of our favoured plays.

Our big bets this year are:
   • Hosting and colocation, managed services – infrastructure businesses where
       capacity is now filling, and recurring revenues on long term contracts allow us
       some top line visibility.


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   •   Outsourcing. It’s steaming ahead, and we think will continue to do so, at least
       partly because open standards such as XML make it far easier to outsource than
       was the case when everyone had big bespoke systems.
   •   Software – not everything will do well but we believe there will be a focus on
       business intelligence, management of business processes, and optimisation of the
       big software infrastructure that was installed from 1998-2001. Low cost will also
       be a factor with more emphasis on upgrades and add-on modules, and less on
       single big ticket sales. For those who think software is stuffed – take a look at
       SAP’s latest results. They’ve done pretty well on licence sales, against all the
       odds.
   •   Telcos!!! We believe both BT and Vodafone are due a bull run (and the chart for
       BT looks particularly exciting). Their cash generative potential is currently
       underestimated by the market. We think mobile companies have got more realistic
       about 3G and are just looking to consolidate operations geographically. And note
       that mm02 – not considered the best of breed - actually managed an increase in
       ARPU in Germany and a turnaround to profit in that country. It generates cash
       and has only 3% gearing – not the big-spender high-debt mobile model we’ve
       come to know and love.
   •   Cash and asset backing, failing which recurring revenues
   •   Recruiters and trainers which have shaved their costs to the bone and have high
       gearing to an IT upturn. If they have cash and make a profit, so much the better.
       One interesting snippet came from the Xansa analysts’ meeting – they currently
       have the mix of contractors in the workforce down to 10-15% but that could go to
       25% pretty quickly if there’s any growth in the business. Xpertise seems to be
       doing a lot right and could be an interesting punt.
   •   Advertising agencies and other marketing services as probably the most geared
       play on any media upturn. Incepta we like for its exposure both to specialist
       advertising and to any increase in corporate activity whether M&A, take-privates
       or IPOs (it had practically zero last year). UBM’s numbers show the tech ad
       market, surely the worst of the lot, is seeing a decelerating rate of decline, though
       it has not yet turned round, while we hear UK supermarkets are spending nearly
       as much on advertising as they are on acquiring each other.
   •   And last but not least - 5/2 Arsenal to win the Premiership available from
       Ladbrokes.

What are we out of?
  • Hardware is still a sell. While we believe capital expenditure could ramp up from
      a low base this year, PEs in the twenties and thirties don’t give much room for
      outperformance and we believe most hardware companies will lag the telcos and
      colos on the way up.
  • Consumer hardware with the possible exception of digital radio is likely to soften
      in line with the retail trade.
  • Radio is way too expensive and companies have shown patchy performance –
      Chrysalis and UBC Media are doing very well, Capital and GWR much less so.
      We believe radio stocks have been overbought on the basis of expected
      consolidation – the underlying business is not that attractive right now.


                                             4
   •   Mass media issuffering from digital/Internet/channel proliferation. Zenith
       recently pointed out how ITV share falls from 29% in analogue households to
       25% in Freeview households and even lower for households which take Sky.
       Newspapers for us are not an area of growth either. The way to play the upturn is
       ad agencies and specialist media, not Carlton/Granada/DMGT.
   •   IT Consultancy. Looking at Xansa, it seems that most of the damage done this
       year was in the ex-Druid business – SAP consultancy which is mainly driven by
       new installations. Then we had the profit warning from Charteris, which now
       expects to make a loss in the next half year. We think most consultancy firms will
       be hard put to it to get much of an increase in utilisation rates, and hence profits,
       this year.
   •   Sports media plays, particularly those focused on football. Reduction of the
       transfer seasons to one tight window, together with lower media contribution to
       the game, mean that the overpopulated sports sponsorship sector will have to
       consolidate. And given that it’s a people business with limited technological or
       capital requirements, that probably means insolvencies rather than acquisitions.
   •   West Bromwich Albion to win anything between now and the end of the season.
       Or to sign any new players before the transfer window closes. Very, very
       improbable in our (somewhat biased) view, though the shares are worth a look for
       the asset value and a yield second only, of course, to the Villa.


“Bums on seats” – or data on servers
Last year was a disastrous year for hosting and colocation businesses. So was 2000. in
fact, it’s been a bloody awful decade so far.

However, we believe 2003 will be the year that this industry turns around. It’s taken
some real hits on staffing and total capacity and we’ve seen a number of exits (including
Cable & Wireless cutting its capacity, but not enough for some investors). Besides, we’ve
noticed over the last year that the corporate community has become much more accepting
of outsourced data storage and management. At the same time, what was the ASP market
has become more mature and moved towards managed services, rather than software
rental .

We have also seen a real change in the sort of financial numbers coming out of some
stocks. While Redbus Interhouse appears to us to be so far below capacity on its data
centres that it will never fill them up – has it built the Centre Point of the data market? –
Telecity has most of its locations the right side of EBITDA profitability and looks set to
move into profit overall at some point this year. (This is not a forecast! but EBITDA
positive in Q2 looks eminently reasonable.) Host Europe, in the enterprise web hosting
market, ought to be generating cash soon and has recently launched services aimed at
resellers, a growing market. Even outside the hosting sector per se we find managed
service ideas such as Eckoh and Netstore (where cash pretty much accounts for the share
price, so heads you win, tails you win) or Affinity (on the consumer side).




                                              5
And outsourcing remains strong – that’s the message in both public and private sector
business. Xansa suffered badly last year as profit warnings hit home and other
outsourcing companies tanked, but towards the end of the year it gained a number of
good contracts and it looks set to increase its business (its Indian operations allow it to
offer very competitive pricing). Even better news, the big BT finance outsourcing deal
actually made a profit in H1 – while we’d usually expect costs to be more significant in
the first year of life – and the company has stressed its intention to maintain the dividend.
With a PER of ten and a 6.2% yield there’s room for the stock to do better this year.

ICM Computer is doing good business in business continuity services – and businesses
do seem to be getting the message that this means more than just offsite backup. What we
hear, which is good news for the business continuity gang as well as for Telecity and the
hosts, is that there’s more interest than ever in mirror sites – and perhaps more
understanding that business continuity is a complex discipline. ICM is trading at about
nine times earnings; Computerland UK, another one we like, is a bit higher priced at 13
times (and came in with an ‘above forecast’ trading statement), but that’s still lower than
peers Synstar and Computacenter.

Finally, one little thing suggests that managed security may be a new service to join the
MSP portfolio. Traditional anti-virus software is becoming increasingly ineffective as
‘blended’ viruses become more common, attacking at points other than the email client
and performing different tasks. They are less easy to spot and spread more quickly than
‘traditional’ viruses – meaning that customers who depend on self-administered
downloads of patches to address new virus outbreaks are likely to find their security has
already been compromised. Time for managed security to break out of its niche and
address the main market?

Could this be the new Sage?
A risky prediction, but we think CodaScisys could be “the new Sage”. We were really
impressed by the acquisition of SquareSum – in fact it’s such as obvious fit that we’re
pretty peeved we didn’t put it in our “what Santa’s got in his sack” feature. Both are well
respected, award winning finance systems – and both are based on a single database
structure rather than separate ledgers (like most other accounting software). In fact
product integration should be easy, since SquareSum was set up by ex-CODA people and
shares a common philosophy.

The deal works out as a reasonably valued one despite initial impressions of high price,
since there are substantial savings to be made. This year there’ll be about £1m of savings
on our estimates, with a £1m sale of the SquareSum freehold, and £1/2m cash reducing
the effective entry price to about £7.5m. The non-execs of SquareSum are going, the plc
overheads can be cut out, and people from SquareSum will be moved into the main Coda
offices (just up the road, as both companies are Harrogate based – indeed the move
should now have been done! They don’t waste time, these chaps). Coda will also benefit
from having closed its Nottingham R&D office.




                                              6
CODA gets an SME product – their existing product is really focused on the larger
company – and this should help them retain legacy customers which are smaller in size
and don’t need the full package. At the same time, CODA extra modules can now be
ported to the SquareSum product range and effectively reduce the amount of R&D
SquareSum needs to move upmarket a bit. Plus, there is now a reseller base – the one
thing CODA was missing (since the full version of CODA is essentially a consultancy
sale).

Meanwhile we believe Sage, though an excellent company, has missed a trick by not
transforming its software for the new world of XML. Sage may have been right to steer
clear of the ASP route – though managed services is different, and growing, so this is
something we’d like to see them making moves towards – but we believe the software is
now behind the curve on both XML/web services functionality, and analytics. And while
these may not be as applicable to Sage’s product base of SMEs as they are to Fortune 500
companies, both capabilities are increasingly provided through other software – and are
demanded by large companies using smaller subcontractors (which was one of the huge
drivers behind ISO 9000 and similar quality standards).

Besides, Sage is now being squeezed by SAP coming down market with an SME product,
and more seriously by Microsoft moving up market from Money and Quicken to a
revitalised Great Plains product. Microsoft also has Navision, described by one FD we
know as “80% of SAP at 30% of the price” – though we don’t expect to see it make a big
move till 2004 with this one. So unless Sage has something in the R&D cupboard, it
could see its market leading position being eroded over the next year.

Hard cheese, hardware

Hardware stocks did well in Q4 (and yes, we missed it) as investors went bottom fishing.
(In our experience, bottom fishing tends to produce a Sainsbury’s trolley missing one
wheel and a couple of bits of old bikes – but that’s if you do it in the Birmingham Canal
Navigations…)

We think this leaves hardware looking damned expensive. For instance ARM is still on a
PE in the high twenties, despite the fact that it has seen a fall in unit prices (ie royalties
per unit shipped) and new licence signings have dried up too. At TransEDA, which
supplies the semiconductor industry with outsourced design verification services, more
than half the share price is represented by cash – but it is still burning cash and isn't by
any means the largest player in this arena. Is it time for a trade sale?

There is an argument for looking at some of the royalty-model companies as turnarounds,
since contracts tend to be struck well in advance of commercial production – say twelve
to eighteen months. However, while this may mean there’s some better newsflow in the
next year – Imagination Technology has said that it’s seeing more new licence enquiries
- the cash flows from these deals won't accrue till 2004.




                                              7
The real turnarounds though will be in the manufacturing sector. Many of these
companies have cut their capacity to the bone but still have low utilisation rates and are
losing money. For instance IQE, which offers semis the opportunity to outsource their
epitaxial wafer requirements, is still seeing cash burn of £3m a quarter though it has cut
its costs considerably and mothballed one of its facilities. Its fixed costs account for the
majority of total cost base – a clean room has to be kept clean whether you’re
manufacturing anything or not – which explains why it has made a negative gross margin
for some time. Once the market recovers, we expect to see the company getting a better
price for its wafers (at the same time as benefiting from raw materials stocks bought at
lower prices) but most importantly, a substantial amount of increased turnover falling
directly to the bottom line. It’s tricky to value a company making such losses but looking
at past years, the company made 0.63p a share in 2000, admittedly on a rather different
manufacturing base – if it did so again it would be valued at 8.7 times earnings. Look at it
another way, it’s selling for about twenty cents on the dollar of sales. It’s higher risk than
most software companies but potentially higher reward.

Hey big spender
Advertising is already turning around. Some companies haven't noticed – WPP, Capital
Radio, DMGT – but ITV is seeing ads up slightly (only two or three percent, but that’s
better than a fall) and there are some projections for Internet advertising to rise by 46%
this year. UBM’s ad figures are interesting. High tech advertising in the US fell nearly
50% in 2001 – this has now moderated to less than 20%, and from here on out the
comparisons get easier. And that sector is the worst of the worst.

How can we take advantage of this? Most advertising companies remain aggressively
valued in our view. For instance WPP trades at around 18 times earnings – 14 times on
the highest EPS estimate – with Aegis on 16 times. Both have PEGs higher than one,
which suggests growth is adequately discounted. Most media owners are even more
highly rated; Carlton (as was) on 23 times is clearly overvalued if, as we do and Zenith
does, you believe ITV will never have it so good again. Partly this is due to investors
getting a bit quick on the draw for recovery – partly, we think, due to bid interest on the
back of the new media bill.

We prefer to look for marketing services companies which are less well followed, and for
specialist media companies – particularly those focusing on sectors which may start to
turn around. Euromoney Institutional Investor would probably be worth a punt with a
yield of 5.9% and PER of 11.8 times - but the dividend isn't well covered, and has been
flat for three years, while the company has shown limited growth in the last five years –
two of which benefited from a major bull market. We prefer Informa Group, with a PER
just over 9 and 4.6% yield, which has some interesting stakes in the telecoms and media
sector as well as in finance and insurance. We’re particularly intrigued by a recent story
that Informa will be launching new titles – is the ad market better than we expected? The
only fly in the ointment here is high gearing.

Sound-alike Incepta has ticked up recently but is still on a single figure PER for the year
to February 2003, with a dividend yield almost exactly the same as Informa’s. While best


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know, perhaps, for its Citigate PR division, Informa derives nearly a quarter of its
revenue from direct marketing activities, which have been strong during the media
downturn, but another quarter comes from specialist advertising, which is directly geared
to any upturn in the cycle. Gearing appears modest, the comparators are rock bottom – no
IPOs this year and hardly any M&A work, so 2004 has an easy target to beat – and even
though margins have been savaged, it’s still making money.

On the whole, though, we believe media may not have as good recovery prospects as tech
for 2003.

Christmas comes but once a year…
Thank God! (Sigh of relief, look at credit card statement again and wonder how I spent
that much…)

Looking at the retailers’ statements, though, Christmas didn’t come at all in 2002. Dixons
had an abysmal time, bearing out Game Group’s poor trading statement. Game’s shares
fell from 105p to 30p on the news and though they’ve subsequently bounced to 39p the
company’s credibility has foundered.

Many of the UK games stocks also fell on the Game Group announcement. Was this fair?

We think not. We believe the main problem area for Game doesn’t affect the developers
or publishers at all. Console prices have been cut dramatically – that trimmed Game’s
revenue totals and its margin. After all, when your margin is trashed on the £150-200 a
throw box, selling a few more £40 a time games isn't going to restore it. UK stats show
hardware only up 1% in value (despite PS2 salesd up 12% in volume) – but software up
nearly 20%. But for the publishers and developers, that’s good news – the more PS2s that
get shifted, the larger the target market for PS2 based games. And it doesn’t look as if
many games were reduced in price. So Game’s problem is a hardware problem, not a
software problem. Indeed the Consumer Electronics Association in the US forecasts
games software growing revenues by 17% next year while PC sales are forecast to grow
just 4%. We know which market we’d rather be in!

SCI Entertainment was badly hurt by the Game debacle. And yet it had just reported
excellent results, sales for Conflict: Desert Storm (aka ‘Stuff Saddam Yourself’)
exceeding 1m, and a strong portfolio of planned releases including a sequel to Desert
Storm which will be published in the US by Take Two. The market even seemed to be
warming to the stock, when Game’s trading statement trashed the shares.

SCI now trades on a PER of four. Okay, that recognises that every game starts life with
zero sales and that having published one decent game is no guarantee of success with the
next (or even, as with Tomb Raider, a guarantee that it will actually get released…) But
given that Take Two has guaranteed a level of minimum sales for two future releases,
there’s a good level of backing for the revenue forecasts – which isn't the case with, say,
Rage. That reduces the risk substantially as does SCI’s aim of fully outsourcing its




                                             9
development to maintain low overheads. And if the market doesn’t realise the potential in
this stock, we wonder whether an industry buyer might be tempted in…

Note by the way that not all the money in games is made at Xmas. In fact, Grand Theft
Auto and GTA: Vice City (squash pimps, run over policemen, reverse over pedestrians,
and then trash the car – all good clean fun) seem to have dominated the holiday market to
the extent that no one else got a look in. Certainly not Rage’s Rocky which sold 77,000
copies. No wonder the bank was not impressed. That’s only slightly more than the
average gate at Man United, apparently! SCI seems to have been prescient in launching
Desert Storm earlier in the year.

What’s a pity is that the next half year for almost all the games stocks in the UK looks
very poor in financial terms, owing to releases coming out part way through the period.
We’re looking forward to a number of releases from Empire and Argonaut as well as
Battlebots from Warthog – and look forward to playing them. (Readers who do PR for
games companies, you’re right, this is a hint. And thanks Empire for Big Mutha, er,
Truckers – a gloriously tasteless game!!)

A for effort, B plus for performance
2002 was not a vintage year for anyone but in the true spirit of open government (as
implemented by T Blair), rigorously independent analysis (as carried out by Merrill
Lynch) and heavy irony (never used by yours truly) here goes with a review of how the
TMT monthly did last year.

   •   Avoiding hardware – yup, that turns out to have been quite clever. We did make
       one exception though, and that was a big mistake – Pace Micro (though we were
       out of it as soon as NTL went under and its true exposure to a single customer
       was made clear). Even in the big Q3 rally, hardware underperformed the SCS
       players and telecoms.
   •   Local government – an okay sort of recommendation. Idox hit all its forecasts for
       new business and made a useful acquisition; Comino and Northgate turned
       themselves around, though the share prices still haven't caught up. Some nimble
       companies such as EPIC and Detica have done well out of the public sector to
       make up for a slow commercial sector, and Tribal now says it has more than 80%
       of next year’s forecast revenue already committed.
   •   Human resources – not as good as we hoped. Bond did very poorly and
       OneClickHR caught a cold after early promise. Recruiters on the other hand did
       have an interesting uptick in the first half of the year, but it soon petered out. Not
       deterred, we think the valuations are still convincing enough to be buying for
       recovery. (Strangely enough the one HR stock we know to have done well is
       Neuer Markt software vendor Atoss, which is now turning a profit.)
   •   Elearning – we were right not to get too excited about what was available. RMR
       is now a cash shell and Adval is restructuring following poor interims. On the
       other hand EPIC has come good in the second half, gaining plenty of public
       sector business, while also building a recurring revenue base through services. It



                                             10
       also addressed our major reservation on the stock (that it was purely consultancy
       and didn’t have scalability) by creating its first product.
   •   Online travel – we didn’t actually put this in the January TMT but picked up the
       theme pretty quickly and it was our standout subsector last year, with both
       eBookers and lastminute more than trebling their share prices over the year.
   •   Avoiding consultancies – that was quite smart of us. A lot of people went from
       software into consulting stocks, thus locking in two losses instead of one. We
       were wary of Charteris (that was prescient) and Axon - but we did get back into
       Xansa a bit too quickly, underestimating the damage that had been done to their
       business change operations. On the whole it was a lousy year for consultants –
       only the outsourcing companies outperformed.

So on the whole, a pretty reasonable year with a few good recommendations, some that
didn’t actually make that much money, and no absolute howlers (except Pace). Let’s see
what happens next…


How sad is this?
We have shown some very sad ideas in recent months, including the Mobile Phone TV
channel and the fact that more people watch football than sex on UK TV. We’ve now
decided to make this a regular feature and our first “How sad is this?” award goes to
Dave Burns of RSVP software for his assertion that “every time I buy a pizza or book a
taxi, I start thinking about how our software could handle the transaction”.

Dave, go and get a life! (He even lives in Manchester, poor soul…)

Close runner-ups for ‘how sad is this’ are the many Dream Direct customers who have
phoned up to order the Hornby Train Set software. And particularly those who have also
ordered the new strip tease computer game. If you want to get pics of naked human
beings on your computer, there are easier ways…

Footie note
A quick follow-up to our recent story from the Malagasy league. According to more
detailed reports, AS Adema managed to win the match 149-0 without gaining possession
once!! That surely is a record that will stand for all time.

A bit of real footie trivia now. Has anyone else noticed that the Premier League table is
now headed by the first team in alphabetical order, with the last two teams in alphabetical
order at the bottom? And Chelsea (third letter of the alphabet) is third, with Everton (fifth
letter of the alphabet) fifth.

(A pity that the second team in alphabetical order isn't number two in the league. Still, at
least we’re above both Brum City and the Albion, which let’s face it, is the way it ought
to be.)



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Description: Geronimo!!! From Crazy Bear to Sitting Bull