Linda Prosser, Alien?s corporate marketing VP, said the company had always been slated to go IPO last Friday and that the decision to move it to day-by-day status?where the company is not saying that it will go public on any particular day, but is awaiting better market conditions?was not related to anything about Alien's financial health or product status and that the only influences were "geopolitical events."
But Prosser mostly wanted to refute some comments made on these pages by a veteran analyst?Pete Abell--now working for IDC.
"The key problem is that they continue to hemorrhage money. Their highly self-touted FSA manufacturing process gets yields in the 15 percent range, and they currently sell readers to Wal-Mart at $200 below manufacturing cost," Abell, the program director for RFID at IDC's Manufacturing Insights, said in the stories from Friday. He added that Texas Instruments "has a great new UHF chip just certified by EPCglobal, which will compete with Impinj, and Alien's is an also-ran." TI announced the availability of that chip on Monday, July 31.
Prosser went on-the-record?which is unusual during a company's quiet period?to dispute Abell's 15 percent yield statement, dubbing the claim "absolutely and dramatically incorrect information." When asked what an accurate yield would be, she initially said it would be "competitive" and then?when prompted?said that would be "north of 90 percent" and quickly amended that to be "north of 80 percent."
Abell, reached Monday night, stood by his original figures. "Every person that has been to their factory [who Abell has spoken with] says it has been in the 15 percent range," he said.
Abell added that even if the figure was 90 percent, it would still be inadequate. "Even 90 percent is not good enough because you're still throwing away too many chips," he said.
Prosser took exception to the Wal-Mart reference, dismissing it as an old rumor that has never been confirmed. Asked if it's indeed incorrect, she said that it was not completely accurate as it was phrased, but that she couldn't clarify because pricing information about customers is strictly confidential.
On Monday, Abell also said that the TI chip availability announcement "really nails the coffin closed on Alien's IPO."