• 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.

*Revenue recognition rules were rather different back then. Multi-million payments or guarantees for ports could be recognized as lump-sum revenue up front.

**Ingres once ran on more hardware platforms than it had employees, when both numbers were somewhere in the 40s. Most of the boxes on which the porting was tested were in one small office.

The benefits for a young software company of being in the professional services business include:

• It can be high-margin, especially if it shares the cost of sales with your software offering.
• It allows you to say “yes” to whatever the customer asks for. (More precisely, it takes you closer to that goal that you’d be without a service offering.)
• It allows you to fund capable staff. Or to put it even more bluntly …
• … professional services brings in revenue that pays your bills.
• It gets you involved with customers, learning stuff about their needs, and specifically addressing them.

The disadvantages of professional services generally boil down to various forms of defocus; you can screw up your development schedule, your development priorities, your sales priorities, your partnering efforts, your market positioning, your burn rate or just about anything else.

Many software companies pursue substantial professional services when they’re young. Many don’t. Both strategic choices can make sense.

• 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. I personally bought Oracle stock around that time, and it grew into a rather significant fraction of my total IRA.

*For a guy who

• Made his name kicking Cullinet’s butt as New England regional sales manager for Applied Data Research,
• May never have hit another sales target again, and
  
• Greatly improved his most famous employer by being fired from it,
  

Mike Fields has a lot of fans — including me. Some people actually do deserve to fail upwards, and I think he was one of them.

The person who made Oracle into a truly major enterprise technology company, however, was nobody I mentioned above. Rather, it was Ray Lane. Some of the reason, as I’ve already noted on DBMS 2, was general good management. Ray was also a tireless salesman, for example once telling me of a very large deal he won by being the only executive of his seniority to show up and give a pitch. But the most interesting part of his success was the strategy he fostered, namely the integration of packaged software and high-margin professional services.

In theory, that integration is blindingly obvious.

• If your professional services are rich enough, you never have to say “No” to a product feature query. You only have to state a price.
• You’re selling two high-priced things in one sales cycle.
• Since your professional services people are* the world’s greatest experts on your products, the services can be inherently high-price/high-margin.

*or at least can be represented as

In practice, despite many attempts, it had rarely worked well before. Reasons included:

• Packaged application software products weren’t actually very easy to customize and extend.
• The core competencies of application development /execution software companies and applications purveyors were very different.
• Even application software companies and application-oriented professional services companies had different cultures.

Some of the few successes were:

• American Management Systems, which did a great job selling semi-custom software, especially to governments and other not-for-profit customers.
• To some extent, vertical market providers in highly regulated industries (not-for-profit, banking, insurance, health care).

Apparently, highly regulated customers felt they had to have what they had to have, and paid whatever price was necessary to get it.

I haven’t identified a silver-bullet insight that Ray Lane’s Oracle had that other companies didn’t, allowing them to succeed where others had failed. They just executed and got it in large part right. Indeed, their technology for semi-custom applications went just as awry as most other vendors’, most notably in an effort to provide industry-specific I-CASE (Integrated Computer-Aided Software Engineering) models as project starter kits. Even so, the business model just seemed to work.

In large part, the industry followed suit. To this day, professional services are a bigger part of software vendors’ business mixes than they were before Ray Lane.

One might ask, “What about all those system integration partners who recommend software, and don’t want to be competed with?” Those came to the fore in the 1990s as well, after Rob Kelley and Brian Sommer paved the way at Andersen Consulting (now Accenture) in the previous decade. SAP owed a large part of its success to them, as did Siebel Systems, whose early success had a lot to do with a super-close Andersen relationship. Indeed, by all signs they are a major reason Oracle retreated from Ray’s strategy. Services (mainly consulting), which hit 58% of revenue in FY 1999, were down to 21% a decade later.

Other possible reasons for abandoning its successful strategy include:

• Oracle soon embarked on a strategy growing by acquisition.
• Geographic outsourcing would have made things harder to manage.
• It’s hard to scale a professional services business too big while maintaining premium quality.

But those are subjects for another time.

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.

*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.

I got James Marsters (“Spike” on Buffy the Vampire Slayer) to autograph a shirtless picture of himself. Linda was a very serious Buffy fan, and I was no slouch in that regard myself. So we flew out to Santa Barbara to join some acquaintances from a Buffy-centric mailing list. Except first, we went – along with the hostess for the gathering – to see James perform with his rock band Ghost of the Robot in Santa Monica. She had downloaded a photo she wanted to pass out to the other (mostly female) attendees. But neither she nor Linda wanted to actually ask him to autograph it – too fangirlish or something. So I stepped up and made the request in their place. (Technically, asking James to sign anything other than a Ghost of the Robot CD was against the rules – but he was more than gracious when I said that if he signed for me it would be a great help to my relationship. )

I had (inter)national reputations in four different fields before my 24th birthday – two academic, two non-academic. I got my PhD in game theory, independently proving a theorem that was simultaneously (and a few months earlier) proved by Mertens and Neyman. Naturally, the game theory community was quite aware of my work. Then I did a post-doc in public policy for a couple of years. Some of my work – sort of a public-sector version of real options analysis, although unfortunately I wasn’t familiar with that concept – was widely circulated among the US utility regulation community. Then, at age 21, I went to Wall Street, as a stock analyst covering the software industry for a major firm (PaineWebber). That pretty much assured me of being known in both the investment and software businesses, especially as I soon got pretty high in the third-party stock analyst rankings.

Graduating college at age 16 cost me my NCAA eligibility – and I wound up regretting that aspect. On the whole, I’m hardly an athlete. But I did take a few fencing classes, and enjoyed them. So when my grad school offered an intermediate intramural fencing class, I was psyched. But when I went the first day, they explained that they didn’t have the resources to offer the class. Instead, anybody who wanted to could join and hence work out with the Harvard fencing team, whether or not they were good enough to compete. Only they couldn’t do that for me – because my NCAA eligibility had been shot when I graduated from Ohio State.

I double-dated with Larry Ellison, twice. Part of the explanation is that when I lived in Manhattan, I had almost no friends there, but quite a few in the SF Bay area. (Seriously, which kind of work acquaintances would you expect me to have more in common with – tech entrepreneurs or Wall Street professionals?) So if I wanted to introduce a new girlfriend to my friends, we’d fly out west. And if there’s one company at which I had a lot of friends, it was Oracle, which I’d first visited in 1983, when it was still located at 3000 Sand Hill Road and had fewer than 50 employees. I was very engaged with Oracle professionally through most of the 1990s – but we also got together just for fun.

I was the top-rated chess player my age in the United States. This is when I was 13 years old, in 1973. But I wasn’t nearly as good as that factoid suggests. 1973 may have been the weakest year for 13-year-old US chess players in modern times; I made #1 with only a 1650 rating. (To put that number in context, it indicates that this 2300+ rated 13-year-old could have routinely obliterated players who could, in turn, have routinely obliterated me.) More on the story may be found at this link.

I told people at a conference “I just spent the afternoon with Bill Gates’ girlfriend — and boy is my butt sore!” This was in 1985 or so. I was a stock analyst living in NYC. The annual American Electronics Association investment conference in Monterey was a must-attend event. Flight connections, however, were imperfect. So Ann Winblad had the idea that, during my several-hour layover, she’d pick me up at SFO, and we’d go drive around the mini race track that’s still there off of 101. I got pretty sore bouncing around in the little plastic cars, perhaps because I wasn’t a very experienced driver. Indeed …

… I didn’t own (or lease) a car until I was 36 years old. (To readers from California, this one may sound the oddest of all. ) I left home at age 16 to go to school in Cambridge, MA, where one doesn’t typically have a car. I left there at age 21 to move to Manhattan. Finally, when I was 36, I left Manhattan for Lexington, MA, at which point I of course got wheels. That Toyota served me well for about a decade, but eventually …

… my first car forced a DBMS vendor to evacuate its whole office building. My Toyota Camry had an engine fire in Intersystems’ building on Memorial Drive, and the building has indoor parking. The story is here. Actually, many other companies had to evacuate the same building.

My kitchen caught on fire, just as I was Twittering with LeVar Burton of Star Trek:TNG and Roots fame. That juxtaposition was a total coincidence. LeVar had just tweeted me his vehement agreement to something I said, when Linda appeared at my office door, having noticed the sound of what turned out to be a fire on the stove. This story has been the subject of several other blog posts …

By the way, what I’d said was, after LeVar tweeted his pleasure at for once actually acting again (on stage, no less), that we choose our original professions for a reason – taking them up again, even for a little while, is like going home again. Even today, I rarely feel more right than when I’m doing mathematics.

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’s DB2 perhaps excepted. And I say “last year” so as to duck the questions of whether Exadata finally solved Oracle’s problems and whether Madison will once Microsoft releases it.

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.

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.