The Subprime Crisis and the Impact on the CEP Market

Last quarter TIBCO Software missed earnings after an earlier warning.  Among other things, the Q3 2007 earnings teleconference highlighted dissappointing sales in the financial services sector.

Experience has demonstrated,  time and time again, when a sector is underperforming and cutting costs, one of the first line items in the budget to dramatically decrease is information technology (IT) expenditures.   This is also true in financial services.

The subprime meltdown which caused E*Trade’s stock to drop nearly 60 percent this week is, and continues to, dramatically impact the financial services industry (FSI). 

In turn, this impact will almost certainly adversely effect IT expenditures and new technology investments, such as complex event processing solutions and similar projects, in FSI.

StreamBase has shown some business savvy by focusing on the on-line gaming industry this year.   

This is a good time for all software vendors, including CEP vendors, to diversify their sales strategy on a wide variety of markets.  I recommend looking at a variety of sectors,  not only FSI; for example, manufacturing, supply chain, retail (consumer services), and telecommunications. 

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