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CNET News.com: Atipa hopes cash infusion will steer it to IPO

Feb 24, 2000, 16:23 (0 Talkback[s])
(Other stories by Stephen Shankland)

"The company, based in Kansas City, Mo., has been selling Linux computers but believes that better profit margins can be found selling services and helping customers migrate to Linux, said chief operating officer Mike Jacobs. Atipa is opening new support offices in several major cities to get close to potential customers, he said."

"The change in the company's business mirrors a shift under way at Atipa's main competitor, VA Linux Systems, which went public in December. Jacobs acknowledges VA Linux's lead but argues that "with the market expanding, we think there's room for a number of players. Our intention is to be one of the premier ones...."

"Currently, about 50 percent of Atipa's revenues are from hardware sales, with 30 percent from software sales and 20 percent from services. "As things move along, we certainly see the professional services side moving up to 50 percent and the hardware decreasing," Jacobs said. "As time goes on, there's going to be significant margin squeeze in the hardware market."

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