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Marimba eyes added revenue from new software unit

Trying to garner additional revenue, the software maker launches a new division to offer some of its core software on a hosted basis.

Looking to nab additional revenue streams, software maker Marimba on Tuesday launched a new division to offer some of its core software on a hosted basis.

The company said its new unit, Marimba.net, will offer managed services to companies, allowing companies to hand off many of their Internet-based technology functions such as content distribution, updates to applications, device management and application performance monitoring.

Marimba said it always planned to eventually begin offering its software as a service.

"The initial business plan (for Marimba) was to deliver software as a service," said Madison Laird, the newly elected general manager of Marimba.net. The company is aiming to make revenue streams more predictable via a subscription model and to give customers what they have been demanding, he said.

Through the new division, Marimba will charge clients for use of its software on a per-month, per-user basis. Marimba, which will host the software from data centers owned by Web hosting giant Exodus, will manage, maintain, administer and update the software remotely for its clients.

The initial services offered by Marimba.net include a Web-based reporting service and a hosted content distribution service.

The move comes amid difficulties for Marimba, which posted a third-quarter loss Monday of $3.6 million, or 15 cents per share, compared with a loss of $164,000, or 1 cent a share, in its same period a year ago. Though the company warned of a greater loss than anticipated, Marimba still missed analysts' estimates of a 14 cent per share loss.

The Mountain View, Calif., company was once considered a high-flying business and a pioneer in the once-hot market for so-called push technology. In the mid-1990s, push was seen as one of the first "killer applications" on the Internet. Companies such as Marimba and PointCast Network delivered information automatically to a PC according to programmed preferences, eliminating the need to surf Web sites to gather specific news or information.

Marimba announced that 3Com is its first Marimba.net customer. Marimba will manage and maintain content updates to 3Com's new Internet appliance, Audrey.

Marimba.net's hosted distribution and managed reporting services are available immediately, the company said. Global distribution services, hosted at service provider facilities outside the United States, are planned for the first half of 2001.