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Marimba Looks For More Predictability In Wake of Q3

In an effort generate more predictable sales in the form of recurring revenue, Marimba Inc., a provider of Internet infrastructure management solutions, on Tuesday bowed Marimba.net, a new division that will focus on subscription-based application deployment.

By introducing what it terms a managed service provider (MSP) service, Marimba intends to leverage its software expertise and take a bite out of a potentially lucrative marketplace, according to Madison Laird, general manager of Marimba.net.

"The MSP market is currently valued at about $90 million, but it is expected to reach $3.25 billion by the year 2005. We intend to take a substantial chunk of that market," he said.

But Marimba is also hoping to add more predictability to its revenue mix and avoid announcements such as the company's Oct. 5 disclosure that revenue would be lower than expected due to a failure to complete anticipated sales. The news cut the value of Marimba's stock price in half on Oct. 6. Late Monday, the company indeed posted weaker-than-expected results for the third quarter.

"Marimba offers software that enables companies to deliver more powerful, cost-effective applications and services to their customers. However, we found that our clients were using less than 20 percent of the software's ability to meet their requirements," he added. "Since we know what is possible to accomplish with our technology, we created Marimba.net so that customers could have the opportunity to drive their businesses using our technology on a subscription basis."

Initial services offered by Marimba.net include a Web-based reporting service and a fully hosted content distribution service. Both the reporting and hosted distribution services provide customers with enhanced management capabilities through a private, personal service portal that supplies customers with real-time access from anywhere on the Web to a wide variety of user reports, status information, monitoring and performance data, logging and debugging information and account management and usage statistics.

"Customers can subscribe to the reporting service independently," noted Laird. "The service focuses on performance and consumption pattern of end users. It identifies what sites are being visited and how the content gets consumed."

He noted that additional MSP services are under development.

While announcing the new division, Marimba simultaneously reported that 3Com is employing Marimba.net for hosting and delivering its Audrey Internet appliance. Audrey is designed to reside at the nerve center of consumers' homes to enable intuitive information access, communication and organization for entire households.

Marimba.net provides 3Com with the ability to personalize software and content updates to Audrey, automatically and transparently to the end-user, and to collect anonymous service usage information in order to provide a consistently rich user experience, according to John Powell, manager of applications engineering at 3Com's Internet Appliance Division.

"The 3Com Internet appliance team's philosophy focuses on providing the best Internet experience by doing a few specific tasks extremely well," he said. "Marimba.net is enabling us to fulfill this vision by supporting reliable, bandwidth-efficient delivery of the software updates required for a uniformly rich customer experience for all Audrey Internet appliance customers.

"Secondly, by outsourcing management of the software distribution process to the expert team at Marimba.net, we are able to deliver the rapid deployment of new content and services to our customers with a high quality of service," he said.

The MSP service is part of Marimba's goal of enabling the World Wide Web to act as a utility, Laird concluded.

"We believe that the Internet should be like water or electricity," he said. "Service should be seamless and people shou