John Linton's Personal Musings

John Linton

......at least they can if they are unbelievably smart old dogs.

I did think it odd back in mid 2009 when Sun Systems was 'put up for sale' and one of the main contenders to buy it was Oracle plus some interest from HP with only IBM as a late, but serious, contender. Eventually IBM withdrew for reasons that escape me now and Oracle continued to fight through the morass of EU regulation to complete the sale. I actually met Larry Ellison in 1979 when Oracle was in its very, very early stages and I was working for Fujitsu (Facom as it was then) heading up mainframe sales in Australia and New Zealand. He was a mesmerising man with ambitions that seemed to be ludicrous way back then (to sell database software at $US1 million price tags to the 1,000 biggest companies in the world).The major thing I remember him saying, perhaps that should be prophesying, to the head of Fujitsu's computer operations, was that mainframe hardware would continue to get cheaper to the point where its cost was irrelevant to larger companies (at the time the biggest mainframe sale I had made was a little over $A26 million) but database software would only grow in cost and importance to the world's largest companies. I also remember him saying that he had zero interest in computer hardware as it was a waste of time that should be devoted to developing software.

I was interested to see from this article:

http://online.wsj.com/article/SB10001424052748704905604575027602941385866.html?mod=WSJ_Tech_LEFTTopNews

that as recently as 2007 Larry Ellison was still of the same opinion but obviously, in the very recent past, he has done a 180 on that view of life. Of course Oracle has grown into a gigantic corporation since 1979 and a lot of things have changed dramatically though his prophecy that mainframes would die out and become of irrelevant cost didn't really happen other than in a predictable technology development way - however I don't think, at least in his heart of hearts, that even the super confident Mr Ellison would have envisaged himself as actually achieving what he said he would some 30 years ago and still be running Oracle today.

For someone who always eschewed anything to do with hardware it is an interesting 'late life change'. What will happen in the future with a pure hardware company controlled by a person with no affinity (of his own choosing) for anything to do with what makes hardware appealing is going to interesting to see. One thing is certain though; you don't get to be almost as wealthy as Bill Gates in the technology business (without operating a monopoly) unless you are the very best at what you do over a very long time. Clearly Mr Ellison is exactly that.....even if he is past the 'age of retirement'.

One of the first points in the article struck a chord with me - his statement that he was commencing hiring a new 2,000 person sales force. It made me think about the future we have vaguely planned for Exetel beyond whatever happens after the NBN2 nonsense resolves itself and the actuality of wireless broadband becomes clearer after the LTE trials later this year and then after LTE is more widely deployed. Even back in 2004 when we 'created' Exetel we have always known that there was no 'big company' future in wholesaling services provided by other parties much beyond 2013 (or thereabouts - our time frame was really ten years from where we were then) and that we needed to prepare for that time by building the things we would need to do something different than we did then, and largely, do now. In our limited way we knew that whatever it was it would almost certainly be software and network capacity and that it would almost certainly involve large businesses as customers....beyond that we hadn't got any ideas.

Over the past few years we have gradually built up a very competent data base and facilities programming team and have written a large amount, relatively, of code for many different applications. Today, after 6 years of intensive development, we still have a longer development list than the day we started coding. One of our reasons for opening facilities in Sri Lanka and developing close contacts with a university in Colombo was to ensure we could build a highly competent programming team there. We have reached the stage where our 'software' products are becoming more important to our customers and we need to more quickly develop the 'old' ones (SMS over DSL, FAX over DSL, VoIP In A Box and MoIP) and add the ability to more rapidly develop new ones. We also realised, hard not to really, that we needed to develop a highly competent corporate sales operation. When I look at the current plan the overwhelming majority of the additional money we are allocating is for software development and corporate sales and engineering support.

Maybe Exetel will actually become better known for its software services in a few years time than as a wholesaler of low end communications services - though I very much doubt that we can obtain Larry Ellison's 'million dollars per sale' levels.