Overall, the positive earnings surprise will be well received by investors, but the outlook for the company remains uncertain.

I don't think Federated will be alone in talking down earnings expectations for the quarter and also the second half of this year. You look at the things impacting Federated and they are industry and consumer-related issues, not company issues.

We have added some real depth in areas. Our (newcomers) will be a real positive part of the 10-game season. Our team speed has improved tremendously with our first-year players. Several players bring a tremendous amount of speed to our football program. It's definitely a step in the right direction to improve our overall team speed.

Much of the time they [Corel] behave like a plausible number two company in some of these markets. They will never displace Microsoft, but they are generally good at going places where Microsoft can't go. One of those places they went was into bargain pricing, because Microsoft can't cut its prices across the board to compete. They continuously find points of vulnerability at Microsoft. Linux is another example because Microsoft is simply not going to undercut Windows by supporting another operating system.

We're coming close to a heavy reporting season. We will start to hear positive or ... more than likely negative surprises like what we saw with Computer Associates earlier.

We will continue to invest in systems, people and product expansion, each of which helps us better serve customers, ... For the rest of 1999, we expect to invest more heavily than we have in the past.