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November 3, 2005

SGI kicks the bucket

Bye bye, SGI. It was nice knowing you, back when you were a fascinating and innovative force in the computing world. Now you're just overpriced, underperforming, and about to be delisted from the New York Stock Exchange.

As a shareholder, this is rather disappointing, particularly as the present value of my shares is less than the commission I pay to execute trade orders.

I can remember when SGI (as Silicon Graphics, with a much cooler logo) was on the forefront of computing technology. If you watched a Hollywood movie, inevitably SGI was in the credits somewhere because that was what you used if you wanted to do special effects. Terminator 2? Jurassic Park? Lurking in my closet is an SGI Indigo, the model that was used to do the special effects in both of those films.

Sun Microsystems was in a similar predicament to SGI a couple years ago, being completely out of tune with the rest of the market. They turned things around and are doing some awesome stuff now (like their new x64 servers that gutpunch their competitors in price, performance, service, power usage, thermal output...). SGI, meanwhile, sits around and stagnates. And gets delisted from the NYSE.

But that's what happens when your entry level product sports a poorly-accepted, poorly-performing processor, and the cheapest model you offer is $7,000.

How the hell SGI got Wells Fargo to give them a $100 million line of credit recently, I don't know. If someone walked into my office and gave me a pitch like that ("We'd like $100 million dollars so we can sell overpriced, underperforming servers to a market that basically doesn't exist!") I'd have to excuse myself to go laugh my ass off. And then cry because the moron pitching to me was representing what used to be a visionary, powerful company.

Vaya con Dios, kiddos. It's been nice knowin' ya, but I doubt you'll pull through this one.

Posted by Colin at November 3, 2005 9:01 AM

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