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

ld be able to take it for
granted. Plus, if something breaks, the end user is not responsible for the
repairs. We are helping to create a self-healing online environment.”

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