How big vendors are getting it wrong in the recession

I just finished reading Dennis Howlett's excellent analysis "Surviving and thriving: or why MISO has it (mostly) wrong" in which he discusses the basic strategic mistakes being made by Microsoft, IBM, SAP, and Oracle. The net takeaway is that the companies have an unfriendly attitude toward customers and a focus on technologies that the market has not demanded.

Some key points that outline why MISO are going in the wrong direction:

• The egregious treatment of customers at the shrine of maintenance revenues
• The foundational technologies for what they deliver are all showing distinct signs of age, wear and tear
• The five year lifecycle of product delivery is all wrong in today's rapid development

One of the reasons we hear (and write) so much about open source and cloud computing these days is because customers want to be in control of their destinies as well as their infrastructure. MISO offer a great deal of lip service to new technologies but don't deliver an overwhelming wealth of new products or features that users actually want.

What's the point of selling me shiny new technology which I'm struggling to understand anyway when I need to pay the bills more efficiently but more importantly find new business.

Howlett wrote a lot of words, but it's definitely worth a read. The issues at hand with MISO provide enormous opportunities for start-ups to jump in and take market share while the big guys offer empty promises.

Follow me on Twitter @daveofdoom

[Goodbye Helicopter]

lots of opining, nothing to back it.
big guys have big tools that do big things.
yeah, those tools have big warts, but those big guys aren't going away.
they play in different markets.

[cvaldes1831]

If you are thinking from a shareholder perspective, Microsoft is the closest thing to a stinker in the group (matching the S&P 500 over the past five years). The other three companies beat the S&P 500. Try this: http://tinyurl.com/pblnw8

As Goodbye Helicopter said, these big tools take big time to qual. Installing the Oracle RDBMS on Bank of America's servers isn't like installing Intuit Quicken on your home PC or Adobe Dreamweaver on your work PC.

The five-year lifecycle is perfectly appropriate when you're talking about big iron. And yes, you are talking about big iron.

[daverosenberg]

That's true to an extent about the product development lifecycle, but the bigger issue is that there is a lack of innovation where users want it and vendors continue to milk maintenance streams for features that users don't care about.

[cvaldes1831]

Have you even installed the Oracle RDBMS once?

You can install core components and add optional features. Back when I got started with Oracle, there was the basic RDBMS and you could add things like PL/SQL or the ConText Cartridge (later known as interMedia Text). And maintenance support for ConText/interMedia Text was a separate rider to the maintenance agreement.

I can understand your stance that there's a dearth of innovation where some users want it, but to say that these big vendors just charge you for maintenance for unused features is a total crock.

Remember that Dr. Eric Schmidt claimed to have scored the world's cheapest Oracle installation when he pushed forward to have the fledgling company's back office software replaced by big iron. What's GOOG's market cap compared with ORCL's these days, mmm?

Dr. Schmidt proved that you *can* get your money's worth from the big boys, as long as you know what you install, what not to install, what to pay for, and what not to pay for. A bad deal is not automatically forced down your throat.

[odubtaig]

I can see the first two bullet points but the idea of 'this modern day of rapid development' needs to be canned. If it's so backwards and out of date, why is it the basis for the development cycle of RHEL? Why does Ubuntu have LTS releases? Why Debian?

Having to chop and change the working environment every six months, having to recompile any non-vendor-provided kernel modules on every kernel update because the symbols have changed (again!), having to upgrade the entire distro just to use the new version of OOo or compile it myself; these are all reasons why I'm using Linux less and less these days.

It may annoy the hell out of me but when I download or buy a program for XP I don't have to worry about these things because it's not a constantly moving target and developers aren't playing a constant game of catchup with the latest version or, more often, not even playing the game (like Softimage 7.5 only supporting Fedora Core 5).

I'm still running Ubuntu 8.04 on this laptop because it's the stable almost non-moving LTS version and RHEL 5.3 still supports newer tech like vPro with backports. With such stability developers can plan, produce and support programs without having to support the newest, second newest, third and possibly fourth just to support the last two years worth of one distro (and if you don't think it's that difficult then you've never attempted it).

Messing about with getting things working in these systems was interesting when I had more time but I'm almost 30 now and I'd just like not to have my time wasted by this attitude of constantly pushing the absolute latest and freshest over a nice stable environment where I can just get my work done.

After all, businesses are only just now seriously thinking of moving to Vista. I don't think they consider a 5 year cycle too long.

[ghostofitpast]

The claim that "customers want to be in control of their destinies as well as their infrastructure" smacks of the usual self-delusion of the IT world. In this story we are talking about BUSINESS customers, which means customers who, more than anything else, want to be in control of the core operations of their business, whatever it may be. Whatever the size of the business (not to mention the infrastructure "iron" for that business), the COO has enough to worry about in the core business to add new technologies to the mix. That first bullet may be right in its own limited way; but we need to be careful to distinguish "maintenance" from "ongoing service," which includes tuning and evolving the support technology to the needs of the customer. Customers pay MISO for this; and the real question is whether or not they get their money's worth from that ongoing-service point of view.