Sunday, May 02, 2010

More on Consolidation in the CEP Industry (re: Opher)

Opher Etzion mentioned my latest blog posting and my "return to blogland". I am happy that, after all of these months, some people are still reading this blog. It's difficult for me to watch all of the blogging from the sidelines, but as many of the readers here know, when I started my new job, I gave my word that I would reduce my blogging my 99%. And, since my daughter starts McGill University in the fall, I would like to be able to pay for her college education, even though McGill is half the cost of Carnegie Mellon (her other top choice).

But, back to Opher's posting. Yes, there is a certain amount of stability when a large company purchases a small software manufacturer. For example, all of my concerns about the financial stability of a company like Coral8 would be assuaged by their takeover by Sybase. I do not know how much longer Coral8 and Aleri could have lasted given their revenue at the time of their purchase.

But, I used to like the fact that, if you needed questions answered about the internal architecture of the product or about the roadmap, you could usually get directly in touch with the CEO or CTO, and they would give you immediate answers, most often on a weekend. You would never get that same level of support from a Sybase, an IBM, or an Oracle.

With a smaller company, you had more control over negotiating licensing costs and maintenance fees. They were anxious for your business. The cost of Coral8 for a single core was $15K, and you could get a license for an 8 core machine for $120K (or, if you negotiated really hard, for $100K). I wonder what the current price for Coral8 under Sybase is now. I wonder if you could even purchase the legacy Coral8 product anymore, or whether it is wrapped up inside of Sybase RAP.

When I asked Coral8 or Aleri to come to a meeting at Citigroup, and to only show up with two people, they would agree and comply. When I asked IBM to come with 2 people when they demoed their CEP product to me, they showed up with about 10 people, most of whom just sat their with their hands folded or took notes on everything I said. After they did this, I refused to take any more meetings with the IBM team on their CEP product, even though I had a few good email exchanges with some of their more technical people. Such is the arrogance and disregard for the (potential) custom that I have often found with a very large company.

Many times, when a small and innovative company gets bought by a mega company, you lose the two most important things that the small company has to offer .... the people and the innovate-or-die attitude. You most certainly lose the small-town, personal touch that the company gives you. On that note, a fond goodbye to the guy with the most infectious laugh in the industry, Jon Reicke, who is now making people laugh at Google in New York.

I certainly hope that Panopticon, one of the last of the good guys, does not get swallowed up by Sybase, but I am not hopeful. But in the rush for consolidation, this would not surprise me at all.


©2010 Marc Adler - All Rights Reserved. All opinions here are personal, and have no relation to my employer.

2 comments:

Marco Seiriƶ said...

Nice to hear that you like Panopticon. Not that I have anything to do with them, but it always feels good when Swedish software companies are doing well.

As for the University, come to Sweden. It's free here :) Even for guest students.

Mack said...

Panopticon is pretty cool - and I say that even though I'm not Swedish. That combination of CEP with data visualization makes for a compelling demonstration. It's going to be interesting!