As part of my series on the keys to and likelihood of success, I’d like to consider some historical examples in various categories of data management.
A number of independent mainframe-based pre-relational DBMS vendors “crossed the chasm”, but none achieved anything resembling market dominance; that was reserved for IBM. Success when they competed against each other seemed to depend mainly on product merits and the skills of individual sales people or regional sales managers.
IBM killed that business by introducing DB2, a good product with very good strategic marketing from a still-dominant vendor. By “very good strategic marketing” I mean that IBM both truly invented and successfully market-defined the relational DBMS concept, including such conceptual compromises as:
- Ted Codd’s 12 rules, not that anybody — even IBM — actually followed them all.
- SQL as the standard, rather than the probably superior QUEL.
In the minicomputer world, however, hardware vendors lacked such power, and independent DBMS vendors thrived. Indeed, Oracle and Ingres rode to success on the back of Digital Equipment Corporation (DEC) and other minicomputer vendors, including the payments they got to port their products to various platforms.* The big competitive battle was Oracle vs. Ingres, about which I can say for starters: Read more
I never met IDG founder Pat McGovern, who was the kind of tycoon that traveled around the world handing Christmas bonuses personally to every employee in his firm. Even so, McGovern’s passing seems like an occasion for recollections about IDG through the decades. And so:
1. My connections have always been much stronger with IDG (International Data Group) publications than with the analyst firm IDC that’s also part of the business.
2. I have at times been pretty connected to those pubs. For example:
- I’ve been a columnist for both Computerworld and Network World (the latter online-only).
- I’ve blogged for pay for both Computerworld and Network World.
- I’ve been outright interviewed by each, and quoted many times by them and other IDG publications as well.
3. Computerworld has probably always been the leading enterprise technology publication, including during the trade press’ glory years. Most memorably, pre-relational mainframe DBMS were claiming with some success to be “relational”. But when Computerworld reported Ted Codd’s “rules” for RDBMS, that was that — RDBMS were defined to be what Codd and Computerworld said they were, and the bottom dropped out of the market for DBMS that didn’t meet Codd’s criteria.
4. In line with its industry leadership, Computerworld had a classified ad section that ran dozens of pages. When I hired a research assistant in my stock analyst days, the obvious choice was to run the ad there.
5. To this day, if an ego-surf shows that I’ve been quoted in countries and languages around the world — Brazil, Australia, Iran or whatever — it’s usually something I said to IDG, which then translated and republished it around the world.
6. IDG is a big enough press organization not to be perfect. Read more
The commercial computing, software and services industries have existed for half a century or so each. It might be interesting to review how their pricing and delivery models have evolved over time.
1960s and 1970s
Modern IT is commonly dated from the introduction of the IBM 360 mainframe in 1964-5. But even before then, there was a growing industry in what we’d now call outsourced services, specifically in payroll processing; major players included Automatic Data Processing (ADP), the company that gave us Senator Frank Lautenberg, and a variety of banks. This was (and to this day remains) a comprehensive service, priced by unit of work (e.g., number of payroll checks cut).
IBM mainframes, which quickly came to dominate the market, were in the 1960s and 70s commonly rented. IBM software that ran on them was hence typically priced on a rental/subscription basis as well. The independent packaged software companies, however, often preferred to get paid up front,* and hence sold perpetual licenses to their software. Annual maintenance fees for the licensed software started in the range of 10% of the perpetual license or even less, but migrated up to today’s 20-22% range.
|Categories: Analytics, Application software, ASK Computer Systems, Computer Associates, Computer services, Cullinet, EDS, IBM, MSA, Oracle||4 Comments|
I previously posted that the term Business Intelligence dates back to the 1950s, even though Howard Dresner has claimed credit for inventing it at a couple of different points in the 1980s.
Recently I expressed doubts about Actian’s DBMS-conglomerate growth strategy. For context, perhaps I should review other DBMS vendors’ acquisition strategies in the past. Some — quite a few — worked out well; others — including many too minor to list — did not.
In the pre-relational days, it was common practice to buy products that hadn’t succeeded yet, and grow with them. Often these were programs written at enterprises, rather than third-party packages. Most of Cullinet’s product line, including its flagship DBMS IDMS, was came into the company that way. ADR, if memory serves, acquired the tiny vendor who created DATACOM/DB.
Then things slowed down. A Canadian insurance company oddly bought Computer Corporation of America, to utter non-success. (At least I got an investment banking finder’s fee on the deal.) Computer Associates, which did brilliantly in acquiring computer operations software, had a much rockier time with DBMS. It acquired Cullinet, Applied Data Research, and ASK/Ingres — among others — and didn’t have much growth or other joy with any of them.
Indeed, Ingres has been acquired three times, and hasn’t accomplished much for any of the acquirers (ASK, Computer Associates, Actian).
I used to think that Oracle’s acquisition of RDB provided key pieces of what became Oracle’s own extensibility technology. Andy Mendelsohn, however, disputed this vehemently — at least by his standards of vehemence — and his sources are better than mine. Rather, I now believe as I wrote in 2011:
… while Oracle’s track record with standalone DBMS acquisitions is admirable (DEC RDB, MySQL, etc.), Oracle’s track record of integrating DBMS acquisitions into the Oracle product itself is not so good. (Express? Essbase? The text product line? None of that has gone particularly well.)
Experiences were similar for some other relational DBMS pioneers. Read more
|Categories: Applied Data Research, ASK Computer Systems, Computer Associates, Cullinet, Database management systems, IBM, Informix, Ingres, Microsoft, Oracle, Sybase, Teradata||1 Comment|
The single company whose history people most often ask me about is Oracle. That makes sense — Oracle is a hugely important company, which I’ve known for almost all of its 30-year commercial life. And of course, this being the week of Oracle OpenWorld, Oracle is top-of-mind.
Let’s start with a breezy overview, setting the stage for more detailed posts to follow. As I see it, there have been four eras at Oracle, which between them reflect just about every tech company management theory I can think of.
Startup: This period comprised initial development, custom contract with the US military (CIA, I think, even though the demo database was always naval), and initial product release. This is the one phase of Oracle’s history I didn’t witness personally. But it seems to have been pretty much a story of “build a minimum viable product for a great vision, and hustle until somebody buys it.”
Hypergrowth: Roughly speaking, Oracle grew 100% per year on its way from $5 million in revenue to $1 billion. This period formed much of the basis for Geoffrey Moore’s famous “Crossing the Chasm” series of books. In line with Moore’s later observations, Oracle’s priorities in this period were: Read more
I’m in Istanbul, in the second part of a two-week vacation with Linda. Last week we stayed almost completely in the old city, with our hotel being just 3 blocks from the Gülhane tram stop. This week we’re in the new part, on a hillside between Taksim Square and Kabataş. For a variety of reasons, I haven’t been as diligent about email and so on as I usually am while on vacation, and I’ve been completely unavailable for any except the most utterly urgent phone calls, of which there thankfully have not been any. But this evening, while Linda watches Muhteşem Yüzyıl in the other room, I’m in the mood to write a bit of travelogue, and post it in what among other things has become the most personal of my blogs.
Linda lived in Turkey for a while with her first husband, and speaks excellent Turkish. (In general, the Barlow women have an amazing talent for languages.)
If you’ve never been to Istanbul, it must be seen to be believed. From a hills and water standpoint, imagine 10 San Franciscos, but with many of the buildings being 500+ years old. The whole thing is wrapped around the Bosphorus, in which at any moment you can see 2-3 tankers, a whole lot of commuter ferries, and generally more ship traffic than I imagine can be found in any other similar expanse of water in the world (the Panama Canal area perhaps excepted). And there are plenty of places from which to get awesome views, most notably on the water itself. If you’re ever in Istanbul, seize every pretext you can find to be out on the water.
When it comes to great religious buildings, Istanbul may be my favorite city in the world, ahead of Rome, Paris, and even Kyoto. Reasons include: Read more
I recently wrote a long post on the premise that enterprise analytic applications are not like the other (operational) kind. That begs the question(s): What are operational enterprise applications like?
Historically, the essence of enterprise applications has been data management — they capture business information, then show it to you. User interfaces are typically straightforward in the UI technology of the era — forms, reports, menus, and the like. The hard part of building enterprise applications is getting the data structures right. That was all true in the 1970s; it’s all still true today.
Indeed, for many years, the essence of an application software acquisition was the database design. Maintenance streams were often unimportant; code would get thrown out and rewritten. But the application’s specific database structure would be adapted into an extension to the acquirer’s own.
Examples that come to mind from the pre-relational era include: Read more
|Categories: Application software, Cullinet, McCormack & Dodge, MSA, Pre-relational era, SAP||1 Comment|
This post is part of a short series on the history of analytics, covering:
- Historical notes on analytics — the pre-computer era
- Historical notes on analytic terminology (in which many terms used in this post are defined)
- Historical notes on analytics — departmental adoption (this post)
What set off my “history of analytics” posting kick is, simply put:
- Most interesting analytic software has been adopted first and foremost at the departmental level.
- People seem to be forgetting that fact.
In particular, I would argue that the following analytic technologies started and prospered largely through departmental adoption:
- Fourth-generation languages (the analytically-focused ones, which in fact started out being consumed on a remote/time-sharing basis)
- Electronic spreadsheets
- 1990s-era business intelligence
- Fancy-visualization business intelligence
- Predictive analytics
- Text analytics
- Rules engines