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Royal Bank of Canada Cashes Out of SCO; SCO Begins Layoffs
jbell99999 is the first one to submit news that the Royal Bank of Canada is divesting itself of SCO stock. They're selling part of their preferred stock to Baystar, which has already indicated that they want to redeem their shares, and converting the rest to regular stock, which they can presumably sell on the open market. In other SCO news, Versicherung writes "The Santa Cruz Sentinel is reporting, SCO is laying off 10 percent of its worldwide workforce. The cuts come less than a month after the company brought on a new chief financial officer and just before the company ended its second fiscal quarter April 30." See also stories at Eweek and Linuxinsider.com.
....is Canadian shareholders are wiser than the US ones?
"Begins layoffs"? Where have you been, SCO has been laying off staff for months now.
In Santa Cruz, for example, they sliced their tech staff by like 80% or something.
Man, that's a lot of attorneys out of work!
He said BayStar had reached "the conclusion that SCO should focus its resources on its most valuable asset: its intellectual property claims."
I'm sorry, which intellectual property claims were those?
Does Baystar believe their claims of their source code in Linux are meritable?
Ouch - currently, 50% of the total float of SCOX (the SCO Stock) is shorted.
So, for every person betting it is going to go up, there is someone betting it will go down.
I do not fear computers. I fear the lack of them. Isaac Asimov (1920 - 1992)
Say what you want about the policies or politics of SCO, it is always unfortunate when large numbers of people are laid off due to the problems of the company (ie those who made the bad decisions get to keep their cushy jobs).
Help Brendan pay off his student loans
Minion to Darl:
".. We've analysed their attack sir, and there is a danger. Should I have your ship standing by?"
3C
Regards,
John, human
Falling You - beautiful
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... that MS is going to end up buying SCO. Then MS will probably GPL Unix, drop all the IP suits and end up trying to look like the good guys.
Free Firefox news reader.
1. Stop suing them.
2. Then start selling an actual product.
3. Profit.
I can't wait to see how Laura Didio spins this one as a plus for SCO.
Although it starts amongst joyous meadows and cheerful flowers, truly great evil this path leads to. Evil bearing names like Abu Gharib and My Lai.
So just note that it was Royal Bank who against all common sense invested in SCO in the first place. They are just now growing cold feet and preparing to run for the door.
- Have a product
- that is involved in sales
- to customers
- generating revenue
SCO seems to have none of these things.Some mornings it's hardly worth chewing through the restraints to get out of bed.
People are strange when you're Darl McBride
Linux looks ugly when you're alone
IBM seems wicked when you've just sued them
Wall Street is uneven when your stock is down
When you're Darl
Lawyers come out of the rain
When you're Darl
No one won't curse your name
When you're Darl
When you're Darl
When you're Darl
I watched C-beams glitter in the dark near the Tannhauser gate.
I do fear that the next spin on this will be martyrdom, Poor little SCO couldn't get justice before it was forced to its knees by the brutal linux movement sponsored by the behemoth IBM, or something to that effect.
--
If I were an employee there I would have been looking for a new job for months and months and months... Not because I hate SCO but because I would consider the job to be too unstable. If they couldn't have the foresight to do the same... screw em.
According to Zdnet those being laid off are mostly in the engineering, marketing, and sales depatments. This is very telling for a so-called "tech" company to lay-off those responsible for creating and selling your core product. Of course we all know that SCO is a litigation company and has no need for engineers to improve a product, no marketers to hype the non-existant product, and no salesmen to.... well you get the idea.
How do you say "off a short pier" in Chinese?
Managerial Aptitude Test
Q. Your the captain of a ship commanding 100 sailors. Your carrying valuable cargo you need to sell for the owner of the ship. It appears there is a hole in your ship and water is coming in fast. What's do you do?
A. Find out what's wrong and fix it
B. Tell the sailors to start bailing water and sing something happy while they do it
C. Start looking around for at the other ships pilot since this once hasn't got long
D. Move the Cargo to your personal dingy and set sail
E. Tell everyone "This is not happening, everything is normal, the ship cannot be sinking, we take precautions, you know" and remain calm. (Erik the Viking)
F. Start throwing sailors into the sea until to lighten the load?
Just to add another point of view... this may be a bad thing.
[usual disclaimers here; I'm a layperson who has to deal with issues related to things like this occasionally]
The difference between a real company and an intellectual property holding company is that a real company has some skin in the game when it comes to treating patents as trading cards. An IP holding company doesn't.
As a simple example, consider two companies, "A" and "B", with a patent portfolio of 100 patents each, and real products that they are trying to sell.
When company A says to company B "you're infringing patent A17", B can use its portfolio defensively, and come back with "yes, but you're infringing patent B34; let's trade licenses".
If company A is an IP holding company, there's nothing company B can do but pay whatever extortionate price: Company A has no product, and is therefore not infringing any of B's IP. B is pretty much hanging in the wind.
The only place this isn't true is where B has some IP that A acknowledges is the basis of derivative IP held by A, _and_ A values the ability to continue sublicensing it without B raising sublicense fees for the original work in response to the extortion suit.
IF SCO is, effectively shedding their vulnerable assets, and IF they really have IP assets, this could be an entrenchment where it could end up being very hard to dig them out for a very long time.
The only real recourse to this sort of business model is for company B to attack companies that are infringing B's portfolio, and which are owned by the same people who own company A - effectively countering extortion with blackmail.
Yeah, I'm one of those people who think we need intellectual property law reform.
-- Terry
Most of us aren't cheering because someone is losing their job, but because the company that is being such a shit is in trouble.
Kind of like how you might feek bad for telemarketers (the employees), but were happy when the do - not - call list went into effect.
"Faith: Belief without evidence in what is told by one who speaks without knowledge, of things without parallel." - A.B.
Good Lord. RBC is not divesting itself of SCO stock. They are converting preferred to common. Whole different thing.
"Who are in control, they are not in control of anything - they don't even control themselves!" - Glen Beck
as apparently Mr. Burns is running SCO and has a whole team of Homer Simpsons working for him. :)
Remember, Slashdot does not have a -1 disagree moderation, and no, troll, flamebait, and overrated are not substitutes.
You know that it would be untrue
You know that I would be a liar
If I was to say to you
Torvalds is a thief and a liar
Gotta stop Linux or I'm fired
Gotta stop Linux or I'm fired
Try to set the source on fire
The time to litigate is through
No time to wallow in the mire
Try now we can only lose
And our company become a funeral pyre
Gotta stop Linux or I'm fired
Gotta stop Linux or I'm fired
Try to set the source on fire, yeah
The time to litigate is through
No time to wallow in the mire
Try now we can only lose
And our company become a funeral pyre
Gotta stop Linux or I'm fired
Gotta stop Linux or I'm fired
Try to set the source on fire, yeah
You know that it would be untrue
You know that I would be a liar
If I was to say to you
Girl, our lawyers couldn't get much higher
Gotta stop Linux or I'm fired
Gotta stop Linux or I'm fired
Try to set the source on fire
Try to set the source on fire
Try to set the source on fire
Try to set the source on fire
Try to set the source on fire
Ok, so while there is some short-term negative publicity around one major investor bailing, it leaves Baystar capital with much more power over SCO. It's widely conjectured that Baystar's recent abortive bailing-out was actually just a public slap to SCO to get them to make some executive changes. Now Baystar's leverage is increased substantially. It has occurred to myself and to others that what Baystar may be able to do is effectively "foreclose" on SCO - not in the traditional debt sense, but they'll be able to stick a gun to SCO's head and force them to replace board members under threat of Baystar's pulling out, which would effectively bankrupt SCO. Round one - replace the CFO. Round two - put some of our buddies here on the board to provide you with some sage advice.
Then we have Baystar (the Microsoft puppet) effectively inheriting all of the IP claims (by proxy, but the result is the same), which they think are meritorious. This could result in a whole new round of litigation run by someone who's not a complete jackass.
The new litigation may (will)also be a complete pile of bullshit, but it still ties things up in the courts for years. Be afraid, very afraid.
Help save the critically endangered Blue Iguana
In A.D. 2003
....
War was beginning
Darl: What happen?
Blake: Somebody set up us the DDOS.
Mark: We get signal.
Darl: What!
Blake: Main screen turn on.
Darl: It's You!!
Linus: How are you gentlemen!!
Linus: All your IP are belong to us.
Linus: You are on the way to destruction.
Darl: What you say!!
Linus: You have no chance to survive make your time.
Linus: Ha Ha Ha Ha
Darl: Take off every 'IP claim'!!
Blake: You know what you doing.
Darl: Move 'IP claim'.
Darl: For great injustice.
Baystar has what, $80 million in SCO?
What? The original Baystar/RBC investment was $50 million combined, of which, Baystar's part was $20 million. RBC picked up the other $30 million. Today, RBC converted one-third of its investment into SCOX common stock. The remaining two-thirds was sold to Baystar for an undisclosed sum of money, but you can bet it's a helluvalot less than the original $20 million Baystar spent for the same quantity of Series A-1 shares in October.
To be blunt, RBC took it in the shorts on this investment. Baystar screwed them hard. Baystar hooked RBC up with the original PIPE, and then turned around and flushed the value down the toilet with their notice to SCO that they intended to get their money back. They didn't give any indication to RBC about the grounds they were using to justify their demand for the return of capital, so RBC had to stand by and watch their own deadline for making a similar demand expire.
Once that deadline passed, Baystar effectively had first-dibs on picking over SCO's carcass in an ensuing fight. RBC would have to wait until after Baystar got its money back (even though Baystar's investment was smaller) before making any attempt to recover its own investment. This forced RBC's hand. They could sit around and watch their entire $30 million get flushed down the drain, or they could sell (at a loss) most of their investment to Baystar and convert the rest to common stock (at a price that's nearly 2.5x the market price for those common stock shares) in the hopes that they'll get something if SCO wins the lottery.
Unless RBC never expected to make money on this deal for some obscure tax benefit, they got hosed badly. I'd expect to see the idiot at RBC who signed off on this deal resigning very soon to "pursue other opportunities."
Baystar, meanwhile, doubles their position in SCO's Series A-1 convertible preferred stock for a sum that's almost certainly a lot less than the $20 million they paid for the other 20,000 shares, thus reducing their average share price and giving them an ironclad fist around SCO's throat.
Baystar's not as stupid as we originally thought. RBC, meanwhile, comes off looking much stupider than we originally thought.
This might be poignant, but at least if I were to murder someone and the news media were reporting on it they would say "...an alleged murderer"... Why can't they say "alleged intellectual property rights" as SCO hasn't proved anything yet and there is still doubt here.
----
SCO... An alleged company with an alleged business plan.