If you’ve read the blog, you know that we follow the Perils of CA with much amusement. Honestly, you couldn’t make up the stuff that Sanjay Kumar et al were and apparently are still making headlines with “35-day months”, accusations that founder Charles Wang knew and was part of the whole mess, a former US senator involved too, Sanjay’s unbelievable $1 billion in restitution…and the list goes on. (img from NYTimes.com)
But I am reminded that it’s not just the titillating stuff that’s of interest. CA is still one of the Big 4 and up until a couple of years ago making headlines with some major and strategic purchases in our space – such as buying Concord for its e-Health software in 2005 and Wily Technology in 2006.
I recently ran across a 451 Group report, “CA: ghosts of deals past” by Brenon Daly (if you haven’t read one of his takes on the M&A market, you don’t know what you’re missing) that showed quantitatively just how much the acquisitions had slowed down.
2003 – 4
2004 – 3
2005 – 6
2006 – 6
2007 – 0
2008 – 0 (so far)
Two or three years ago (I still have the slide in our presentations), it seemed like you couldn’t go a month or two without hearing about the latest acquisition by the Big 4 – to either fill gaps in their monolithic portfolios or take out a growing threat, which had built some good technology. This should sound very familiar to anyone (like me) who rubbed up against WorldCom. Growth (in revenue and technology) by acquisition. Buy your own revenue and don’t worry about the niggling details like integration.
But we’ve certainly seen the acquisition trend slow across the board. HP, after its mega-purchase of Mercury Interactive in 2005 for $4.5 billion, for example, went relatively silent on the acquisition front in our space. Perhaps, as it turns out, because they were too busy preparing for the even bigger purchase of EDS for $13.9 billion (and the layoffs, 24,600 and counting, which in this worsening economy are probably just starting).
By all accounts the show did go on, and we have some very interesting results to share with you all.
Take the Top Challenges question. Once again, “Supporting New Technologies/Enabling Innovation” was most popular. But that’s a no-brainer and as one memorable respondent told me, “the definition of what I do”. What was more important was seeing the big jump that “Reducing Management Costs” made on the list, from #5 last year to #2 this year and only 1 percentage point behind #1. Tightening the belt is top of mind for everyone. (As I write, the Dow closed down today over 700 points)
Overall, IT professionals told us they were tackling the practical projects that should and could get done – from deploying Security Information Management solutions to getting Asset Management and Inventory Tools in place. For the first time, we saw a close correlation between what people said was important and what actually got done. Of low importance and even lower actual deployments – ITIL and CMDB, IPv6, Green IT and Cloud Computing.
And perhaps people “fessed” up about virtualization. Instead of the usual “high importance, not so many deployments now, but more deployments planned” theme we’ve been seeing around virtualization adoption, this year the very hot trend seemed to lose a bit of steam. Across the board, the numbers were down for virtualization management, with close to 50% of respondents telling us that their businesses were less than 10% virtualized (4% of that with no virtualization at all).
Trade shows, trade shows and more trade shows. VMworld and Interop dominated the stage a couple of weeks ago and then there was the annual Oracle blowout in SF last week. Has anyone gotten any work done lately?? (image from cdye1)
Does Oracle run the world? I would have to say no but Raj (Larry Ellison is his idol) and the 40,000 Oracle customers that descended upon SF last week might beg to differ. What do James Carville and Mary Matalin have to do with enterprise software? Pretty much nothing, except for the fact that they delivered the opening keynote for Oracle OpenWorld. (And that’s the only and last politically-oriented thing you’ll hear from me as we run up to the election). For a surprisingly funny and extensive photo gallery of the eye-popping event, check out cdye1’s photostream on Flickr.
But UB40, Elvis Costello and Seal aside, Oracle OpenWorld did offer training, certifications, and always entertaining speeches by Ellison. Ben Worthen’s favorite – “Larry Ellison’s Brilliant Anti-Cloud Computing Rant” delivered to analysts on Thursday. From Ben’s slightly-edited excerpt:
“The interesting thing about cloud computing is that we’ve redefined cloud computing to include everything that we already do. I can’t think of anything that isn’t cloud computing with all of these announcements. The computer industry is the only industry that is more fashion-driven than women’s fashion. Maybe I’m an idiot, but I have no idea what anyone is talking about. What is it? It’s complete gibberish. It’s insane. When is this idiocy going to stop?
“We’ll make cloud computing announcements. I’m not going to fight this thing. But I don’t understand what we would do differently in the light of cloud computing other than change the wording of some of our ads. That’s my view.”
So did everyone catch that? Cloud computing is complete gibberish and idiocy, but apparently Oracle’s already been doing enough around it to advertise the fact. I will have my cake and eat it too!
We’ve been pumping out the posts from the shows we went to – let me tell you, live-blogging is hard when you’re trying to share apparently miniscule amounts of bandwidth with 14,000 other attendees – and we have even more to share as we step back, contemplate and describe how some of the announcements, info and especially roadmaps fit into our overall picture over here at ScienceLogic.
For example, we released the results of our annual industry IT survey last week. Twice a year – at FOSE (for Government IT) and at Interop NY (for enterprises) – we take advantage of the fact that we have a big beautiful booth at these shows and offer a fabulous ScienceLogic t-shirt in return for a couple of minutes time with attendees living the problems we try to solve. Instead of telling people what their problems and priorities are, we like to ask. Interop NY Survey - Trends and Challenges Detailed Reports on Trends and Comparison to Government IT
And I just had to share this one because it is so bizarre. Are VMware and Paul Maritz guilty of plagiarism? You have to check this out to get even part of the picture. Apparently this guy has posted his slides (we know they are from VMworld 2007 because it says so in the lower-right-hand corner…) which prove that the “virtual datacenter operating system” idea was his idea a year before it showed up on Maritz’s keynote this year. Hmmm. And then after posting all these slides and making all the connections between his presentation and Maritz’s, he says he’s just kidding about the plagiarism. Can anyone sort this out and let me know?
I’ll tell you who wasn’t kidding when I went by their booth at VMworld – a certain chargeback vendor and VMware “partner” who was quite shocked two months ago when they walked into a meeting with VMware about future roadmap. Apparently, the slides they saw (preview of VMware’s announcement re adding extended chargeback capability within vCenter management services) were mighty might similar to slides they had given in a presentation to VMware about their own roadmap. Coincidence? I’ll let you decide. And I’ll also say, their strategy to combat this – support for Hyper-V coming early in 2009.
It didn’t really sink in until after the final black-tie awards ceremony finished last Saturday night that I had a chance to comprehend how starting a company that achieves this list is a once in a lifetime experience.
When I walked up on stage and accepted the Inc 500 award, it hit me square in the face that this is a rare accomplishment, and even more difficult for a product company that started without the benefit of VC funding.
Because I enjoyed hearing some of what I like to call “golden nuggets of wisdom” so much, I thought in my conference wrap-up I would pass on a few to our blog readers:
“Only 7% of our great nation works for Fortune 500 companies. Small businesses and the entrepreneurs are the jet fuel that makes our country fly.”
“Brand is shorthand for a collection of experiences, memories of what it will be like the next time a customer deals with you. With the advent of blogs and consumer activism, Brand is impossible to fake; it is like the temperature in the room… it is there… it exists.”
“At the casino – they train the heck out of the Valet! Why do they spend 3 months on Valet training? Because he is the first and the last person to greet and interact with a visitor during their trip! Who is your company Valet?”
“You need to ditch B-B and B-C Need to become P-P Person to Person.”
“You don’t buy loyalty… you earn it… this is an interesting challenge, but small allows us to behave like human beings… Going off script and doing something human is a great place to start.”
“Stop obsessing about ROI and start obsessing about ROC! Return on Customer/Consumer is much more powerful than ROI!!!!”
“Happy people, unabashedly doing, happy things, makes for happy companies, which create happy businesses which enable happy cultures… IN WHICH THRIVE”
“My leadership was tested terribly - after 9/11 the travel industry was particularly harmed. It was an extraordinary time for Carlson. “
“Put tactics around these strategic initiatives”
Whomever you serve, serve with caring
Whenever you dream – dream with your all
Wherever you go, go as a leader
And never, never give up
Whatever you do – do it with integrity
“That builds trust, trust builds relationships and relationships build results.”
=============================================
Actually, I took about 40 pages of notes throughout the two days… So I can’t say that this will be my last summary post on the Inc 500/5000 conference, but I can say that the conference did leave a strong impression about how I can help shape the future of ScienceLogic in an even more positive way.
This year was a strange year at Interop NY. While the financial industry in NY was crumbling around us, things were strangely normal at Interop. Despite entire departments being laid-off at Lehman and elsewhere, while the show was going on, the show itself seemed mostly unaffected. We even saw this with our annual survey - in 2007 18% of respondents were from the financial services industry, this year the sector respresented 19%.
Interop NY 2008 was up considerably in size from the show in 2007. According to Lenny Heymann, the GM of Interop, this is a trend that they expect to continue. My personal experience was that the size of the vendors was also up this year. I think there were so few startups that “Startup City” was pulled from the show completely. In any case, the show floor was full and there was plenty of attendee traffic to go around.
Definitely helping out from a traffic and draw perspective was the addition of the Web 2.0 Expo - Interop was co-located with both Mobile Business Expo and the Web 2.0 show. It seems like that buzzword still hasn’t lost most of its luster.
From the InteropNet perspective, the main feeling was one of being rushed. With the show only lasting two days, and the InteropNet team only having a couple of days of ramp up time, everything was compressed into a much shorter period than in Las Vegas. While this would normally be a challenge, it’s an even bigger challenge at the Javits where the InteropNet team was allowed to do almost nothing ourselves because of union rules. You’d be surprised how frustrated you can make a network guy who’s told that he has to stand there and watch the electrician plug things in, rather than just doing it himself. The only thing faster than the InteropNet team getting the Interop NY network up, was my pedicab ride to the InteropNet Booze Cruise. (Editor’s Note: Louis has edited out the high-pitched screaming accompanying the ride.)
In any case, everything came off without a hitch, and EM7 performed flawlessly catching a couple of power outages that last day and alerting everyone before the batteries on the UPSes had a chance to run down.
Over the next couple of weeks I’ll analyze the data from the show to see how many tickets were handled, amount of bandwidth consumed, etc and we’ll do a comparison to Interop Las Vegas.
We’re (both ScienceLogic and me personally) looking forward to Interop 2009.
One of his first proclamations - Microsoft has really embraced the heterogeneous environment. Really? How in the world is Microsoft going to help convince IT line managers, or mid level managers to believe this statement? I think they have a long way to go to achieve this vision with any credibility in the marketplace. I do know that they are making small strides.
Microsoft has been widely credited with some very good blogs that are self critical and introspective. They have also been quite active in the standards boards within DMTF and many others such as Open WSMAN and CIMON (Open Pegasus). Microsoft in February published 30,000 pages detailed technical specifications – protocol documentation for Exchange, since that time they have published another 15,000 pages. They have had over 224,000 downloads since February 21, 2008. Thus they are trying to be more open by making some of these secret sauce protocol resourcesdirectly available on the web.
So for now, I will take a very cautious wait and see approach to this proclamation. Time will tell.
Trends
Rapid growth continues
Hosting Competition has a new face
Platform gorillas (amazooglesoft)
Ad supported Web 2.0 hosters (Google, Facebook,)
Utility Cloud Computing models are expanding to non-traditional hosting companies
Wells Fargo vSafe - hard to believe that a big bank would start to offer a SaaS offering
“when Microsoft thinks about the building blocks that make-up the cloud, virtualization is a core piece of the puzzle. However you also need also identity services, Operating system with standard set of libraries to tap into… or remote storage that application developers will tap into.. Developers will consume these set of services, but you will also need a set of tools to manage your physical, virtual and geographically distributed datacenter infrastructure.” (that is where ScienceLogic comes in!!)
He went on to say,
“In some ways, virtualization enables decentralization – allows you to move from data centers, enables fast scaling out, business to move from on premise to the cloud and off again…. Automation is very important – this will help you scale your business – this is core to your future success.”
He talked about a new breed of knowledge worker: He called them Digital Natives (compared to grey haired guys like me who are left out of this category).
Definition of a Digital natives? A young adult who has grown up with cellphone, web based applications, Facebook account, as their primary mode of communications.
John commented that we are 5 years into a 10 year journey. Only 12% of all servers in the world are virtualized today… in the next 4 years it will double to 25%. This is the time to think through how this business will affect you.
‘Virtualization without good management is more dangerous than not using virtualization in the first place.” Thomas Bittman, Analyst Gartner
Patching and provisioning nightmare – no scalable administration – sprawl chaos.
John posed a question to the audience: How do you partner to provide the ISV support in application development with specific market needs… partner by keeping the hosting to SaaS solution providers up and running and provide the quality of service that their customers expect…. Complimentary services of storage and backup is a big win with a huge market-upside over the next 5 years..
During the Q&A, David Burns from Cincinnati Bell asked the very best question… “when are you going to make it easier for the Service Provider market to deal with the Microsoft Service Provider Licensing Agreement (SPLA) quarterly statistics pull and change the SPLA pricing to be more efficient and creative for the new Virtualization and Cloud offerings you have talked about?”
John’s response: “We hear your frustrations loud and clear and are working on some new ideas for the future version of SPLA.” My interpretation – “Dear Service Providers don’t expect anything new or easier to deal with in the next 6 months!”
His closing remarks: “Cloud is evolving = very early stages, lots of hype, but think of how this evolution will effect your business and how you can plug into it.”
We were all really excited to have the opportunity to talk with Rebecca Wetzel of NetForecast and the Application Performance blog on Network World about ScienceLogic’s value proposition at Interop.
Yesterday, she posted a terrific blog post about Interop NY highlights and included a blurb about ScienceLogic that I wanted to include here. I have written earlier posts about how difficult it has been to gain smart, insightful coverage for our solutions with technology media. And I have to say that Sevcik and Wetzel get it!
It’s an interesting thing. When we talk with our customers, they bring up the value of having a single integrated solution - either they get it right away before they even buy it or they tell us about it after they’ve bought and been able to replace multiple solutions that usually never talked to each other. Most media and analysts, on the other hand, tend to gloss over this. It’s a core part of the tradition-bucking decisions we made when we first brought this product to market. And five years later, it’s astonishing to us that this seemingly practical way of looking at the total solution is still unique to us in the market. Other companies may talk about “single pane of glass” but the effort it takes to make that a reality is a tradeoff few make for the benefits. With EM7, it’s literally out-of-the-box. But more than a “single pane of glass”, an integrated solution like ours delivers a “single source of truth” - with synchronized fault, performance and availability information that just makes sense for troubleshooting and keeping your apps up and running 24/7.
And we’re not resting on our laurels. We’ve been hard at work on the next generation of EM7 management products and have taken the same approach to think “outside of the box” to deliver true innovation again in 2009. And Sevcik and Wetzel will be among the first to get a close-up on why and how we’re doing this.
A few excerpts from their post:
“We noticed yet more specialty network management vendors, leading us to wonder how the market can support such a plethora of them, and we felt empathy for IT teams that have to master yet more interfaces.”
“Application performance management and application acceleration vendors were well represented. Such products play well in today’s climate because they allow enterprises to get the most out of existing IT investments instead of buying more “stuff”. One particularly interesting vendor we talked to was ScienceLogic. They are integrating IT infrastructure and application monitoring into a single, not-very-expensive platform that will serve mainstream business well. This is smart, and we predict they will give the CA’s, BMC’s, HP’s and IBM’s of the world a run for their money.”
Interop General Manager Lenny Heymann, took some time out of his very busy show schedule to talk with us at Interop New York this year.
We chatted about the growth of the show and how much that growth reflects the industry itself. Since the bust earlier in the decade both Interop Las Vegas and New York shows have grown year over year – not just in attendees and exhibitors but in topics covered in the conference tracks. As any of us who are in the space know, it’s a rapidly changing market and Interop strives not just to cover the latest trends but also to get ahead of them while still making sure that they are relevant.
The show’s mission overall has expanded beyond “just” networking to cover performance and new trends like virtualization, cloud computing and SAAS that all affect network performance. It is a mirror for the demands on the network (and network admins) and the convergence we see going on that make managing the network so complex today.
Responding to criticisms about the lack of interoperability at the show, Lenny says, “Our special sauce is interoperability.” And in fact the expanded mission of the show ensures that there are more interoperability issues to deal with and he invites the community to comment and share feedback on this core mission.
Last, we talked about InteropNet. We’ve loved our participation in it this year for a variety of reasons – from the opportunity to work with other cool vendors in an intensive and real-life/real-time environment to the true sense of camaraderie and “getting it done” that everyone shares on the InteropNet team to the wonderful atmosphere of hard work AND hard play that you have to experience to believe.
We talked with Lenny about how he measures InteropNet “success” and the answer was illuminating. They’ve got high expectations at Interop; they expect the network to just work, so the focus is actually not on uptime and SLAs – that’s a given. “Nothing less than perfection works here.” (Let me tell you, after my horrible experience with the super slow and inaccessible network at the VMworld conference, that is definitely not always the case. Maybe InteropNet should sell its services…hmmmm…) Rather, it’s about being able to showcase technologies and strategies for networking and interoperability – or as we’re interpreting that, basically “walking the walk – which in the end is what InteropNet is all about.
On the final day of Interop NY 2008, we conducted a second quick poll of attendees (check out the first poll on virtualization here), asking which hypervisors were currently in use. In asking the question, we had certain assumptions – mainly that most people were currently using VMware – and that the real question here was to gauge how quickly Microsoft Hyper-V adoption was coming along. The results both confirmed what we thought and surprised us.
The Results:
Which hypervisor(s) are you currently using?
72% VMware
17% Using something else
9% Hyper-V and VMware
2% Hyper-V
(based on 46 responses)
So the VMware responses were in line with what we thought, although I’ve seen numbers up to 90% share of the market. And about 10% are at least playing with Hyper-V – pretty good numbers just a few months out from launch. But look at 17% using a hypervisor other than Hyper-V and VMware!
We know from talking with people that several brought up Xen. I have to tell you that other than from media and analysts, we never hear about Xen (Citrix), which is why we didn’t include it in the survey as a specific selection. Perhaps it took the introduction of Hyper-V, with the attendant marketing juggernaut, to break people of the VMware-only habit. Xen couldn’t really carry that “heterogeneous” hypervisor environment message on its own, but now that Hyper-V is available, the genie’s out of the bottle. Bears watching.
On another note: We were more successful in hanging onto our marbles on day two – people seemed more in tune to the poll and less focused on collecting giveaways than on day one! [Note: no attendees were irrevocably harmed during the execution of the polls. :)] At Interop Vegas, May 17 – 19, 2009, we’ll be about a year out from Microsoft launching Hyper-V and will make sure to ask the same question then to track changes in hypervisor adoption.
I attended the Inc. 500 conference on Friday and absorbed one of the best conference keynote presentations I have ever witnessed delivered by Jim Collins – Author of “Built to Last” and “Good to Great”.
I have to admit that I was already a fan of Collins’ quantitative style blended with clever insight, but this was the first time that I had seen him in person, and he was just spectacular. He has a vivid, animated way of telling a story, and had a great sense of humor. This combination of presentation skill was put to immediate use with his first statement drawing a hearty laugh from the audience full of entrepreneurs.
“How many of you in the room are constitutionally unemployable?”
Much of his remaining presentation provided interesting stories and insight from the research that he has done to understand the make-up of exceptional companies.
As Jim said, he has spent years studying the contrast between average companies and exceptional companies. They faced the same set of variables… similar economic conditions, similar competition for top human resources, and a similar set of huge unknowns.
What is the single biggest element of difference?
Not a function of the cards you are dealt, or circumstance… it is conscious choice and discipline.
Jim’s key principles & disciplines that have come from the studies we have worked on:
Building greatness is a cumulative never ending process! The idea that no matter how exceptional, you are always only relatively as good as to what you can do next.
Most overnight successes are 20 years in the making…. Wal-mart took 13 years to get to 125 stores. Starbucks required 17 years to get to 38 stores.
“If you start to break Packard’s law, and there are very few laws of business, it is like breaking a law of physics for building great companies.” - David Packard (Co-founder of HP)
If you allow growth to exceed your ability to get enough of the right people to fill the key seats to execute on the growth brilliantly, you will fall as surely as a stone dropped from your hand. This is one of those timeless truths that extends beyond technology and economics.
The number one constraint on growth and sustained success…
An ability to get enough of the right people in the key seats to achieve that sustained growth.
The discipline that WHO comes before WHAT. Collins always kept coming back to the “who” thing over and over again. He said, “The more turbulent the world, (given the great current economic uncertainty of our financial system) the more important this issue is.”
A question from the audience came near the end of his session… How do you figure out who are the right people to put in key seats on the bus?
Collins responded with “Given that I stand here amidst a room full of unmotivated people… the right people are self motivated, self disciplined, self managed, The task is not to motivate unmotivated people, the task is not to have to manage people… self motivated, figured it out from there… self motivated people don’t need tons of management … when you have to start managing, you know that you have the wrong person at the task.”
Final thoughts:
Greatness is not a function of circumstance. Greatness is a function of conscious choice and discipline. It is not a matter of circumstance, it is one of choices.
I believe that every one of the Inc. 500 companies that I met at this conference achieved the list because they did not embrace the status quo. Incredible passion, an unwillingness to accept failure and an excessive and compulsive willingness to solve customer’s problems were key ingredients in the business building formula for the entrepreneurs that were at the conference.
If you’ve read the blog, you know that we follow the Perils of CA with much amusement. Honestly, you couldn’t make up the stuff that Sanjay Kumar et al were and apparently are still making headlines with “35-day months”, accusations that founder Charles Wang knew and was part of the whole mess, a former US senator involved too, Sanjay’s unbelievable $1 billion in restitution…and the list goes on. (img from NYTimes.com)
I won’t belabor the point again but just mention it as context for the 
Trade shows, trade shows and more trade shows. VMworld and Interop dominated the stage a couple of weeks ago and then there was the annual Oracle blowout in SF last week. Has anyone gotten any work done lately?? (
It didn’t really sink in until after the final black-tie awards ceremony finished last Saturday night that I had a chance to comprehend how starting a company that achieves 
As General Manager of Worldwide Hosting, 
On the final day of 
