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Commentary–With the $13.5 billion purchase of Veritas, Symantec takes a seat at the table with the biggest kahunas of business software: Microsoft, Oracle, SAP and–yes–IBM.
Like Oracle’s Larry Ellison, CEO John Thompson is making a big bet on the future direction of enterprise software. Ellison, fresh from his successful quest to acquire PeopleSoft, has argued on many occasions that the software business is fated to consolidate rapidly.
That’s suddenly become the conventional wisdom–especially with two blockbuster software mergers announced within days of each other–but is it an accurate prediction?
The consolidation scenario rests on the argument that the constellation of power has shifted away from suppliers to customers and that too many businesses are chasing too few dollars.
The other side of the argument is that companies only want to deal with a few, high-powered vendors instead of trying to keep tabs on
dozens of suppliers. It’s the “one throat to choke” school of IT management. By this reasoning, the answer is to bulk up through acquisitions, offer a bundle of options and clean up as customers rush like lemmings to so-called one-stop shops.
Maybe. Then again, customers may scratch their heads in confusion at what’s going on. It seems like you can’t just be a security vendor anymore–the landscape is a mish-mash.
So it is that Cisco Systems pulled off several security-related deals, and Juniper Networks got into the act by buying NetScreen Technologies. After revamping its own security offerings, Computer Associates International bought Netegrity and then partnered with Iomega on storage.
Elsewhere, IBM is doing more security and even starting up its own security notification service. Not wanting to be left behind, Microsoft bought a Romanian antivirus company and an antispam company. Even McAfee has strayed from security to offer a TiVo-like device that captures all traffic from a network. Could be that Check Point Security Technologies is the last security pure play out there.
Selling ice to Eskimos
Thompson’s challenge is to cut through all that clutter and talk up the synergies of an overnight colossus that offers data backup, archiving and storage along with its flagship security products. Can he do it? His past may provide a hint about his future.
One of the grunt jobs Thompson held down during more than two decades spent at IBM was the role of evangelizing OS/2.
That meant convincing the company’s developers and corporate customers to buy an operating system that even senior management did not believe in anymore. In other words, the tech equivalent of selling ice to Eskimos.
Know what? He was damned convincing.
If Thompson had received more time and stronger corporate backing, maybe the operating system competition with Microsoft might have turned out differently. In any case, a star was born.
At the time, company insiders distinguished Thompson from another top software exec, also called John Thompson, by his middle initial “W,” which became shorthand for “wow.”
Clearly this was not the usual starched-suit exec that Big Blue was wont to push into positions of authority. He was black and therefore an
anomaly in the corporate culture that defined IBM. Also, he was charismatic, which helped him stand out in a bland company whose apex of excitability was “no comment.” Finally, he was the consummate salesman, smooth and suave down to his shined wingtips.
Thompson took over at Symantec in 1999 and set about transforming the company in his image. Symantec, which earned its reputation as a developer of PC utilities for consumers, went corporate. Within a relative blink of time, the company morphed into a major player in enterprise software security.
Barring the unforeseen, Symantec’s now on track to become a $5 billion operation by March 2006, the close of the fiscal year. With that size company behind him, Thompson thus becomes one of a handful of technology executives whose public pronouncements command the closest kind of scrutiny from customers and ink-stained wretches alike.
Finally, he’s a player.
biography Charles Cooper is the executive editor of commentary at CNET News.com.