Here is a link to the SAIC press release about the acquisition: http://investors.saic.com/releasedetail.cfm?ReleaseID=441633.

Again, this is a colossal failure of an individual company due to a bubble-era VC financing strategy and a bad business plan. It does not signal the failure of an emerging market. Lots of good things are taking shape.

1.The market is and will remain in the early adopter phase.
2.Cash will be king, for the vendors.
3.The year will be marked by churn.

Currently ThinkBalm is covering nearly two dozen vendors. They are either small companies or small, experimental teams within large companies (e.g., Avaya, IBM, and Sun Microsystems). There is no way that a small, emerging market like this can sustain two dozen players — shakeout is inevitable. Not easy or fun, but inevitable.

in the meantime, to comment on Virtuola’s concern: this is still a niche space. 80%+ of the activity in this industry is conducted by suppliers, not consumers(eg this website for example). Forterra is not a name brand behind a tight circle of cognoscenti who spend time analyzing Virtual Reality. IF Forterra ceases to be, it will not have an impact on the industry consumers. But the demise(if it comes to pass) should have an impact on suppliers who can learn from the lesson.

My source says that the Forterra products are fine, but just selling much more slowly than had hoped, and meanwhile they sold next to nothing in Q409…and neither did the partners (IBM, Adobe) because partners were too focused on closing more straegic deals themselves. So management warned the Board, and meanwhile blamed a soft economy, sales execution, and its marketing team for failing to achieve ‘market awareness.’ Then the VCs got really squeamish, pulled back a lot of unused capital, and forced Forterra to make a brutal staff reduction and narrow its focus on two key markets.

These are all textbook moves that occur when a company writes a lofty business plan and doesn’t deliver. But I do wonder: What were the VCs smoking if they were letting the company burn that much cash so early in the game? Was there a really big deal that didn’t come through? And just how many markets did they really think they could penetrate at the same time before “narrowing focus” like any smart startup always does?

While we may be left to speculate on this, as a community, we should also be concerned about the perception to potential clients and the industry at large. What, if anything, can be done to mitigate the potential backlash this experience may have industry-wide?

OLIVE is one of the engines Green Phosphor is betting on for realization of the dream of the virtual world platform functioning as a collaborative presentation layer extending across many enterprise systems.

If you have any doubts about the effectiveness of combining live application screens and desktop sharing with a 3d immersive environment with VOIP, try out Meeting Labs or Wonderland, or any other platform which has achieved that level of software utility.

Arkowitz

Sadly the “uptake” on saving resources and lessening physical risk by working in a virtual world has not yet happened so people are still having to burn fossil fuel, pay higher insurance premiums, place themselves at risk during commutes, role play “office politics”, deal with various stereotyping opportunities because of physical appearance, etc. etc. because even the virtual world companies selling such solutions do not actually *use them*. Which means they are not eating their own dog food which means they are not accelerating development (in order to make their jobs easier) to sustain momentum.

I guess it will be a difficult and long journey to convince executives that they don’t really need to “see the serfs working” in order for the company to deliver positive revenue streams.