On a day when President Obama acknowledged he had to think much smaller than the 60s “Great Society” vision of Lyndon Johnson, Larry Ellison actually went the other way and said “Our vision for the year 2010 is the same as IBM's vision for the year 1960”.
So, step one in that vision is to bring the Oracle software maintenance model to Sun hardware. As this transcript from a call with financial analysts shows:
“Renewing and upselling existing hardware support and increasing attach rates, virtually every customer who buys and Oracle product today buys support, that's not the case with Sun. Some customers are not buying support at all. Some customers are getting support from partners. Some customers may be getting the support, but they're not paying for it.”
So, Mr and Mrs. CIO, have you enjoyed dealing with your friendly Oracle salesperson over the last few years as you discuss the “value from 22% maintenance”? Are you ready to double your fun conversations with your salesperson to also include hardware?
If so, cheer for the Oracle “Great Society”
But if you want smaller “government”, ask Oracle how it is moving to technology-as-service, where you pay by the drink, not in annual chunks and massive purchase orders. Ask Oracle, where the savings are it promised from the consolidations of the last few years. Ask Oracle what is so illegal about third party support around its products, when it itself happily offers to support Red Hat products and its Sun services support HP and other products.
As Lyndon Johnson once said “We did not choose to be the guardians of the gate, but there is no one else.”
So mind that gate, or soon you will be begging the Feds (and the EU) to do to Oracle what they did to IBM in the late 60s.
Update: Larry Dignan has Larry Ellison "retro" in 60s garb and hairdo on the ZDNet page
My wife has been on me to shred a bunch of old financial paperwork. Instead of scanning many of the statements I thought I would see what archives are available from various financial, utility and other companies which have moved to electronic bills and statements. That way I could download a digital version – most in PDF format - from their sites. Or hopefully not even download - have them retain it and access as needed.
I got excited when Fidelity offered statements online going back 15 years – not kidding! But in contrast, others are quite meager. Citi cards allow you to “request” up to 6 statements going back 10 years which they put on-line within 48 hours and hold in your account for a week. Slow, convoluted process. Fail. Bank of America, beyond 18 months on-line, makes you request one statement at a time – and then mails you a paper copy. Fail. I thought it was a ploy to charge more fees, but best I can tell neither charges a fee for the “service”. Also, to BofA’s credit, it provides copies of checks in digital format.
Amex keeps 6 months of statements on-line, then you can order others upto 5 years back, using a reasonably easy menu. It is available on-line within 24 hours. Even better, they pioneered the annual recap so you can download that each year. But for some reason they only retain the current year recap on-line, not that of prior years. Also, wish they would offer copies of charges – something they pioneered 2 decades ago. If you have signed up for their eBilling, Chase credit cards give you access to 6 years of statements on-line – available right away, no ordering needed. For its Platinum cards it also offers a year end recap. Again, recap not available on-line beyond the most recent year.
AT&T offers 18 months of statements on-line. Verizon was one of the most aggravating. In the various silos of that company – FioS, long-distance, wireless etc they must be having chaos in billing. My account, which has been valid for years, would not access the statements. Their payment system cannot access it either since they keep charging late fees in spite of a valid credit card. When I did get in, had access to 12 months worth of statements. Fail.
It would be nice to have online transaction query and data visualization capabilities with most of their providers. Shockingly, for what each of these large companies have in their IT groups in licensed analytical tools, very little is being made available to the consumer – even though it is “our” data. Amex on search and Fidelity on visualization came close to acceptable. In their defense, they figure most consumers download to Quicken or to their accounting systems so let those tools handle the analytics.
Other local utilities and financial institutions we use have very basic digital archives.
So, bottom line – companies, don’t just promise electronic billing or statements unless you can also deliver on your consumers’ needs for digital archiving (for tax reasons, for example) and analytical capabilities. You are creating a headache for your customers and clogging your call centers with routine questions without thinking through how stopping paper statements affects them.
Oracle has invited me to what looks like a 6 hour event to describe plans for the integration with Sun.
Several reasons I am not going:
a) Client commitments. I asked for an agenda last week and got one last night, too late to change my schedule. In fairness to Oracle, the whole program has been put together quickly once the EU announced its approval last week.
b) I would rather hear from them in a year how things are going. I mentioned some of their likely challenges in a blog yesterday.What they present today is going to be primarily a statement of vision –with plenty of Exadata and IBM baiting thrown in. Plenty of other media, analysts, bloggers will report Oracle’s vision. I want to hear about execution – and preferably I will do so via customers.
c) The majority of Oracle customers would rather have an honest 6 hour discussion around their discontent with 22% maintenance similar to what SAP has encountered. I would likely get thrown out for trying to move the discussion to whether the Rimini lawsuit is not just a case of shooting the messenger of that customer message.
Ask most mechanics and do-at-home auto tinkerers what the J1962 is, and will tell you it is their bridge to auto diagnostics. What started off as an interface to monitor car emissions that EPA and various governments around the world mandated has provided transparency to “what’s under the hood” even as cars became more and more complex.
As a result thousands of independent garages provide an alternative to car dealers, and do a fine job at it. And no matter what a BMW or Ford dealer thinks of an independent garage, they don’t go around talking in terms of “their J1962 violated my proprietary IP” and they are “corrupt” and “illegal”. They package 3 or 5 year warranties in the car price and offer other extended support to win the service business fair and square.
In software, we don’t have that so software vendors file court documents like Oracle just did against Rimini Street with words like “corrupt” and “illegal”. In the meantime, they announced nothing to attract customers to stay with them with 3 or 5 year warranties packaged in to the price of the license or something else of value to the customer that a third party maintenance vendor does not provide.
So, attorneys will argue over thousands of pages and millions in fees, when it boils down to a few words:
Larry Ellison is a brilliant man. For many reasons, but particularly for knowing the limits of his company. Tomorrow, he is going to talk about synergies between software, hardware and services as he discusses the Sun acquisition.
Except that he made that same announcement a decade ago when he started Business OnLine. Timothy Chou, who Larry entrusted with building that capability wrote about his experience in a guest column last year. His biggest challenge:
“While the business grew to nearly $200M in four years the biggest impediment to growth was educating Oracle people. Never underestimate the power of the white corpuscles.”
So, Larry smartly did not force the issue within Oracle.
Instead, he nurtured two personal investments, NetSuite and salesforce.com which have shown the world how to integrate software with data center with application management into one contract and one SLA. And at price points the world of Oracle and SAP and IBM are still choking at.
So, Oracle gets another chance. They will have a similar learning curve as Microsoft has been through. I interviewed Mike Manos for my upcoming book - he helped Microsoft (he has since moved to another position) with its recent data center investments as it prepares for Azure and other clouds.
He said it was a significant cultural shift for a software company to be presented with a multi-hundred million capex budget for a data center. The biggest capex many software executives have seen is in their office furnishings. Safra Catz, the CFO will have to get used to those capex budgets and those around next generation chips if Sun hardware is to be kept viable..
The other challenge Mike pointed out was about building an operations culture to support 24x7, demanding, transparent to all SLAs. In the traditional software vendor model, some partner or another absorbs that burden over the wall. Mike calls it “industrialization of technology” and it’s not a skill set that can be acquired over night. And, trust me, Sun itself does not have it – they have some outsourcing experience, but little at the “industrial” scale.
Oracle has another challenge which Microsoft has much less of an issue with– price points. Can it compete in emerging SaaS and cloud markets? Time will tell.
The best thing Larry can do for his company is to send it to its remedial education with a “dunce” cap on – it was not serious a decade ago, it needs to go in a lot more humbly this time.
As the Apple Tablet speculation grows to a fever pitch I thought I would share views from one of the most adept tablet users I have ever encountered.
John Dean used to be CIO at Steelcase, the innovative office furniture company, so knows a thing or two about office ergonomics and etiquette. I interviewed him for my forthcoming book on innovation since he has used a tablet since 2003 ( a HP Compaq TC1000) - way ahead of the curve.
He had invested in campus Wi-Fi, also ahead of most other companies, so employees would be constantly connected and have easy access to “institutional knowledge”
“Of course, every one would come to meetings with their laptops. Have you observed how in a group setting, laptops look like personal shields – they are barriers. And how disruptive keyboard chatter is? Not very conducive to creativity”
So, he led by example and used a tablet.
“The keyboard can be unplugged making the tablet a slate, and you can hold in your lap like a pad of paper. The entry of content and navigation is a whisper.”
“If I was in the driver’s seat in a meeting, I would have a blank PowerPoint presentation ready for incorporating into the session through a projector or display. The combination tablet and display became the digital ink whiteboard we would use in the session to co-create. I would do the same if I was a participant. I would quickly duplicate what was put on the whiteboard. People get visual when they have a whiteboard. You can sketch out a presentation so fast with a tablet...both the text and the diagrams. I would then pass it on to a PowerPoint wizard after others have reviewed my drafts.”
But what it will take for tablets to become more mainstream:
““…organizations need to redefine what is a "good enough" deliverable. I wish I could just share what I sketch out on my tablet. But, today I have to translate it into language of the Word and PowerPoint world. Ideally, those tools should be used for a limited number of formal documents and external presentations”
“When you mess with the physical interaction aspect of a technology the change can be traumatic. We are stuck in a keyboard/text/formal content world with fingers (or thumbs) as the means of interaction. Tablets are capable of making us some much more creative but you better be really good at writing cursive in digital ink. The interaction with the "tablet" computer is going to have to evolve to the paradigm of the Wii before broad adoption occurs.”