Historical notes on software titan Oracle (once called Relational Software, Inc.). Related subjects include:
- Database management systems
- One-time arch-rival Ingres
- (in DBMS2) Present-day Oracle in the database, middleware, and analytic technology markets
- (in The Monash Report) Operational and strategic issues for Oracle
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 blogged a little last year about the rewards and challenges of combining professional services and software in a mature company’s business model. My main example was Oracle. But other examples from Oracle’s history might have been equally instructive. For example:
- Oracle started out doing what amounted to custom development for government (military/intelligence) clients.
- Even when Oracle said it had productized its software, the stuff didn’t work very well without services to get it running.
- Oracle and Ingres both got a huge fraction of their early revenue* from deals to port their software to various brands of hardware.** That’s a lot like professional services.
- Oracle’s huge Tools Group grew out of professional services, if I have the story straight. Indeed, its first product was written by later long-time group chief Sohaib Abbasi when he was a consultant.
Oracle pretty much doubled revenue every year until it got around the $1 billion level. Then things got tougher, industry-standard revenue recognition scandals not excepted. At one point there were only three buildings on the Oracle campus, with large portions of them eerily empty. But the ship righted itself, best exemplified by three transitions:
- Mature financial management arrived in the person of Jeff Henley.
- A serious commitment to product quality emerged, often credited to the late Bob Koii.
- Mike Fields* brought enterprise-class adult supervision to Oracle’s US field operations.
Political battles still raged at Oracle — Mike Fields vs. Craig Conway, Terry Garnett vs. Jerry Baker, and later on Mark Benioff vs. pretty much everybody. But the company was ready to move to next level. Read more
Roland Bouman reminded us on Twitter of an old post I did on another blog about Ingres history, the guts of which was:
Ingres and Oracle were developed around the same time, in rapidly-growing startup companies. Ingres generally was the better-featured product, moving a little earlier than Oracle into application development tools, distributed databases, etc., whereas Oracle seems to be ahead on the most important attributes, such as SQL compatibility — Oracle always used IBM’s suggested standard of SQL, while Ingres at first used the arguably superior Quel from the INGRES research project. Oracle eventually pulled ahead on superior/more aggressive sales and marketing.
Then in the 1990s, Ingres just missed the DBMS architecture boat. Oracle, Informix, Microsoft, and IBM all came out with completely new products, based respectively on Oracle + Rdb, Informix + a joint Ingres/Sequent research project, Sybase, and mainframe DB2. Ingres’s analogous effort basically floundered, in no small part because they made the pound-wise, penny-foolish decision to walk away from a joint venture research product they’d undertaken with innovative minicomputer vendor Sequent in the Portland, OR area.
Computer Associates bought Ingres in mid-1994, and immediately brought me in to do a detailed strategic evaluation. (Charles Wang telephoned the day the acquisition closed, in one of the more surprising phone calls I’ve ever gotten, but I digress … Anyhow, the relevant NDA agreements, legal and moral alike, have long since expired.) There was nothing terribly wrong with the product, but unfortunately there was nothing terribly right either. Aggressive investment — e.g., to get fully competitive in parallelism and object/relational functionality, the two biggest competitive differentiators in those days — would have been no guarantee of renewed market success.
Notwithstanding the economic question marks, CA surprised me with its enthusiasm for taking on these technical challenges. But another problem reared its head — almost all the core developers left the company. (If you weren’t willing to sign a noncompete agreement that was utterly ridiculous in those days, at least in the hot Northern California market, you couldn’t keep your job post-merger.) And so, like almost all CA acquisitions outside of the system management/security/data center areas, Ingres fell further and further behind the competition.
Some of the same information made it into my post here on Ingres history later the same year, but for some reason not all did.
On April Fool’s Day, it is traditional to spread false stories that you hope will sound true. Last year, however, I decided to do the opposite – I posted some true stories that, at least for a moment, sounded implausible or false. This year I’m going to try to turn the idea into a kind of blog-tagging meme.*
*A blog-tagging meme is, in essence, an internet chain letter without the noxious elements.
Without further ado, the Rules of the No-Fooling Meme are:
Rule 1: Post on your blog 1 or more surprisingly true things about you,* plus their explanations. I’m starting off with 10, but it’s OK to be a lot less wordy than I’m being. I suggest the following format:
- A noteworthy capsule sentence. (Example: “I was not of mortal woman born.”)
- A perfectly reasonable explanation. (Example: “I was untimely ripped from my mother’s womb. In modern parlance, she had a C-section.”)
*If you want to relax the “about you” part, that’s fine too.
Rule 2: Link back to this post. That explains what you’re doing.
Rule 3: Drop a link to your post into the comment thread. That will let people who check here know that you’ve contributed too.
Rule 4: Ping 1 or more other people encouraging them to join in the meme with posts of their own.
Hopefully, the end result of all this will be that we all know each other just a little bit better! And hopefully we’ll preserve some cool stories as well.
To kick it off, here are my entries. (Please pardon any implied boastfulness; a certain combustibility aside, I’ve lived a pretty fortunate life.)
I was physically evicted by hotel security from a DBMS vendor’s product announcement venue. It was the Plaza Hotel in NYC, at Cullinet’s IDMS/R announcement. Phil Cooper, then Cullinet’s marketing VP, blocked my entrance to the ballroom for the main event, and then called hotel security to have me removed from the premises.
A few years later, the same Phil Cooper stood me up for a breakfast meeting in his own house in Wellesley. When one’s around Phil Cooper, weird things just naturally happen. Read more
In case you missed it, I’ve had a couple of recent conversations about the TPC-H benchmark. Some people suggest that, while almost untethered from real-world computing, TPC-Hs inspire real world product improvements. Richard Gostanian even offered a specific example of same — Solaris-specific optimizations for the ParAccel Analytic Database.
That thrilling advance notwithstanding, I’m not aware of much practical significance to any TPC-H-related DBMS product development. But multiple people this week have reminded me this week the TPC-A and TPC-B played a much greater role spurring product development in the 1990s. And I indeed advised clients in those days that they’d better get their TPC results up to snuff, because they’d be at severe competitive disadvantage until they did.
It’s tough to be precise about examples, because few vendors will admit they developed important features just to boost their benchmark scores. But it wasn’t just TPCs — I recall marketing wars around specific features (row-level locking, nested subquery) or trade-press benchmarks (PC World?) as much as around actual TPC benchmarks. Indeed, Oracle had an internal policy called WAR, which stood for Win All Reviews; trade press benchmarks were just a subcase of that.
And then there’s Dave DeWitt’s take. Dave told me yesterday at SIGMOD that it’s unfortunate Jim Gray-inspired debit/credit TPCs won out over the Wisconsin benchmarks, because that led the industry down the path of focusing on OLTP at the expense of decision support/data warehousing. Whether or not the causality is as strict as Dave was suggesting, it’s hard to dispute that mainstream DBMS met or exceeded almost all users’ OTLP performance needs by early in his millenium. And it’s equally hard to dispute that those systems* performance on analytic workloads, as of last year, still needed a great deal of improvement.
IBM. With BOMP and D-BOMP, IBM was probably the first company to commercialize precursors to DBMS. (BOMP stood for Bill Of Materials Planning, foreshadowing the hierarchical architecture of IMS.) Out of those grew DL/1 and IMS, IBM’s flagship hierarchical DBMS, and the world’s first dominant DBMS product(s). Of course, IBM also innovated relational DBMS, via the research of E. F. “Ted” Codd, then some prototype products, and eventual the mainframe version of DB2. To this day DB2 on the mainframe remains one of the world’s major DBMS, as does the separate but related product of DB2 for “open systems.”
Cincom. In the 1970s, Cincom was probably the most successful independent software product company. Its flagship product was Total, a shallow-network DBMS that was a little more general than the strictly hierarchical IMS. What’s more, Total ran on almost any brand of computer hardware. Cincom remains independent and privately held to this day.
Cullinane/Cullinet. Charlie Bachman innovated a true network DBMS at Honeywell, but it didn’t turn into a serious product at that time. B. F. Goodrich, however, ran a version. This is what John Cullinane’s company bought and turned into IDMS, which at least on the mainframe supplanted Total as the technical, mind share, and probably revenue market leader. Cullinet (as it was then called) ran into technical difficulties, however, losing ground to the more flexible index-based DBMS. It was eventually sold to Computer Associates.
A lot of software industry leaders cut their teeth at Cullinet, notably Andrew “Flip” Filipowski, later the colorful founder of Platinum. Other alumni include Renato “Ron” Zambonini, Dave Litwack, Dave Ireland, and the original PowerBuilder development team. John Landry and Bob Weiler ran the firm for a while toward the end, but they don’t really count; rather, they’re the most prominent alumni of applications pioneer McCormack & Dodge.
Note: Index-based is a term I used in and probably coined for my first report in 1982, comprising both inverted-list and relational RDBMS, as opposed to the link(ed)-list hierarchical and network products such as IMS, Total, and IDBMS. The companies that beat Cullinet were long-time rival Software AG, and then especially Applied Data Research; then all three of those independents were blown out by IBM’s DB2. And then the whole mainframe DBMS business was in turn obsoleted by the rise of UNIX … but I’m getting ahead of my story.
Software AG. Like Cincom, Germany-based Software AG is a 1970s DBMS pioneer that has always remained independent and privately held. Sort of. Twice, Software AG of North America was spun off as a separate, eventually public company. Software AG’s flagship DBMS was the inverted list product ADABAS. SAP’s MaxDB was also owned by Software AG for a while (and seemingly by every other significant German computer company as well – or more precisely, by Nixdorf where it was developed, and by Siemens after it bought Nixdorf).
I actually visited Software AG in Darmstadt once. Founder Peter Schnell and key techie Peter Page were both gracious hosts. Schnell was proud of their new building, and especially of the hexagon-based wooden dual desks he’d personally designed. General analytic rule – when the CEO is focused on the décor, this is not a good sign for the company’s near-term prospects. (I call this having an “edifice complex.”)
Applied Data Research (ADR). ADR is often credited as being the first independent software company, having introduced products in the late 1960s and prevailed in antitrust struggles against IBM to allow the business to survive. Basically, it sold programmer productivity tools. This led it to acquire Datacom/DB, an inverted-list DBMS developed in the Dallas area. In the early 1980s, Datacom/DB began to boom, and was on a track to surpass both IDMS and ADABAS in market share until DB2 showed up and blew them all away. ADR was particularly aided by its fourth-generation language (4GL) IDEAL, which was an excellent product notwithstanding the famous State of New Jersey fiasco. (As John Landry said to me about that one, “4GLs are powerful tools. In particular, they allow you to write bad programs really quickly.”)
ADR was an underappreciated powerhouse, boasting all of the Fortune 100 as customers way back in the early 1980s (yes, even archrival IBM). When the DBMS business stalled, however, ADR was quickly sold — first to Ameritech (the Illinois-based Baby Bell company), and soon thereafter to Computer Associates.
Computer Corporation of America (CCA). CCA’s DBMS Model 204 may have been the best of the prerelational products, boasting an inverted-list architecture akin to that of ADABAS and Datacom/DB. The company was also interesting in that it was first and foremost a government contract research shop, and hence did all sorts of interesting prototype work that sadly never got commercialized. In about 1983 it became that the company wasn’t going anywhere, and it put itself up for sale.
I was personally instrumental in that decision. Our investment banker pretended he was considering taking CCA public. CCA President Jim Rothnie showed us revenue projections. I asked how he had gotten them. He replied that he had taken the market size projection 5 years out, assumed 10%, and drawn a “plausible curve.” However, I quickly got Socratic with him. “How many salesmen do you have?” “How much revenue does the average experienced salesman produce?” “How many experienced salesmen do you expect to have next year?” “How high do you think their average productivity can grow?” “Let us multiply.” (Yes, I really said that. I can be a jerk. And anyway Jim was the sort of analytic guy one can say that to without giving serious offense.)
CCA was sold to a Canadian insurance company whose name I’ve now forgotten. Eventually, it was spun back out (perhaps after some intermediate changes of ownership), and resurfaced as primarily a data integration company, called Praxis.
In the real old days (mid 1970s, perhaps), Model 204 was resold by Informatics (later Informatics General, later the hostile takeover that became the guts of Sterling Software, which like so many other companies was eventually absorbed into Computer Associates). I know this because Richard Currier used to sell the product when he worked at Informatics. That probably makes Richard and me about the only two people who still remember the fact.
Hmm. I forgot to mention Intel’s System 2000. Well, truth be told it was a dying product even back when I first became an analyst in 1981, and I recall nothing about it, except Gene Lowenthal’s observation that Intel had had trouble selling chips and DBMS through the same salesforce. I think Al Sisto, who I probably met when he was head of sales at RTI (Relational Technology, Inc. — later called Ingres), came out of that business, but I’m not 100% sure. I remember Pete Tierney from that RTI management team more clearly anyway, although that’s mainly because we stayed in touch at subsequent companies over the years.
|Categories: Applied Data Research, Computer Associates, Cullinet, Database management systems, IBM, Ingres, McCormack & Dodge, Oracle, Software AG, System software||1 Comment|
The news about Ingres being spun off by Computer Associates brings back a lot of memories. First of all, Ingres (then called Relational Technology Inc.) was one of the centerpieces of my first-ever research trip to the West Coast in April, 1982. Second, the day CA’s acquisition of Ingres closed, Charles Wang (CA’s CEO, of course), called me personally and asked me to consult to CA about their forthcoming product strategy. It was an intense, month-long project, perhaps still the single largest one I’ve ever done.
So with no further ado, here some observations of and about Ingres through the years.
- Ingres was of course the first of several DBMS companies spun off from UC Berkeley’s INGRES research project, and one of several started with Mike Stonebraker’s involvement. I wrote about that history briefly in my now-defunct Computerworld blog.
- Ingres (then called RTI) and Oracle (then called RSI, for Relational Software Inc.) were of course arch-rivals. As a general rule, Ingres was first to market with new features such as a 4GL or a truly distributed DBMS. Oracle, however, was the first to market with the features customers most cared about, at a level of completeness they found acceptable. Eventually, when Sybase was a factor too, Ingres was always betwixt and between — everybody’s second choice, but not the first choice of enough buyers to keep on prospering. (Later on in the 1990s, Gupta took over the Ingres role in the low-end market — the product was broader than Powersoft, but who cared?)
- Ingres was eventually merged into ASK Computer Systems. While surely a distraction, that’s not what killed it. Each predecessor company had its own problems, and they pretty much stayed out of each other’s way, at least in product strategy. What killed them is that neither side of the business managed to stay fully competitive in product.
- Ingres’s fatal technological mistake was whiffing on parallelism. And it did so in the most painful of ways. Ingres had a joint development project going in the Portland, OR area with Sequent, to develop a parallelized version of their DBMS. They pulled out due to expense, and Informix stepped in. And that’s how Informix managed to be competitive with Oracle in parallel processing, while lack of competitiveness in that area is what doomed Sybase and Ingres. Ouch!!!
- A second Ingres failing probably wasn’t as big as I thought at the time. This was an inability to offer abstract datatypes, aka object/relational, aka UDBMS (where the “U” is for “universal”). I thought this feature would be hugely important, and my opinion on that score probably was a big part of influencing Informix to overpay for Illustra. But Microsoft has never had the feature, and it doesn’t seem to have suffered all that much in the marketplace for its lack.
- ASK was doing even worse on the product side than Ingres — it never came out with a decent GUI version of the product, although ASK did get a license to resell Baan’s code — and the whole sorry mess was eventually sold to CA. CA has a well-deserved reputation for slashing development costs and profiting from slowly-dying software products. But I watched this acqusition from the inside, and to this day I think they really wanted to make the product competitive. But there was one not-so-little problem …
- … CA ran off all of Ingres’s engineers right after the acquisition. CA’s policy upon acquiring companies was requiring employees who wanted to keep their jobs to sign non-compete agreements. In Ingres’s case, however, that policy was a spectacular failure. Oracle, Informix, Sybase, and much of IBM’s DBMS development were all located in the Bay Area. Finding another local job for these guys (and gals) was EASY. Competitors went into a feeding frenzy hiring Ingres engineers, and there was essentially NOBODY left. In my judgment there was a reasonable chance CA could revitalize development with an aggressive investment strategy, but they ultimately blinked. And with very limited ongoing development, the product obviously faded quickly as a mainstream competitor.
I think I’ll go write about the rest of the story over in the DBMS 2 blog.