What differentiates INTS, WIND and soon to IPO Microware? This is a very important question, since it may determine who becomes the Embedded Systems tools player, and it will help us interpret near-term financial performance. Since Embedded Systems tools is an emerging market, building a proper technical and marketing foundation may be as important as experiencing the fastest earnings growth.
What seems to happen to each of these companies is that they periodically encounter opportunities in the form of market niches, and to various degrees attempt to secure the niche with special operating system features and development libraries and tools. The trick for each of them is not to spread themselves to thin with multiple versions of hard-to-maintain of operating systems. Let’s look case by case.
1. INTS has inherited FLEXos from Novell which has an established customer base in POS systems. FLEXos has little overlap with pSOS, their main RTOS. An important spin-off of pSOS is pSET, which is used for multi-media. With MTEC acquisition of Ready Systems, it became a competitor of INTS, spoiling their relationship in which INTS simply resold many of MTEC tools. INTS has been scrambling ever since to develop and/or acquire replacement tools. Meanwhile, the love of INTS life is MatrixX, a non-embedded systems design tool. Rationalizing all this development while rapidly growing a company is a challenge for company management. As new processors become available, it is necessary to port most RTOS’s and all associated tools as fast as possible to remain competitive.
2. Microware, small by comparison to both INTS and WIND, nevertheless may be a formidable competitor, particularly in audio/video (e.g. set-top boxes, media authoring and media servers), as well wireless communications. Their flagship RTOS, OS-9, has been splintered to form DAVID, hopefully for them a standard for video broadcasting and communication. They seem to support fewer platforms than INTS and certainly WIND, sticking mainly to Intel’s Pentium and Motorola’s 68000 series and PowerPC.
3. WIND supports at least as many platforms as all the others combined, priding itself on its ability to remain current on all platforms with all tools all the time. Witness WIND’s pre-release last Spring when is announced its latest VxWorks upgrade on all supported platforms simultaneously. WIND has always been the leader in innovative tools and generic concepts (witness: first to incorporate networking features; first to develop a non-intrusive debugger ((WindView)); and now Tornado the most advanced IDE available which also provides an enabling platform for 3rd party integration of add-on tools.)
What are their relative strategies?
1. INTS and Microware are both willing and desirous of focusing on niche markets. Apparently INTS owns ATM machines, for example. They both have tackled video products with many announced relationships and development efforts, and the beginnings of may become huge revenue streams. In particular, Microware emphasizes strategic relationships up and down the complete multi-media food chain, from multi-media authoring (e.g. Macromedia), to serving up media interactively (Oracle, Sybase), to set-top boxes (20+ design wins). INTS also has had success with a variety of multi-media applications including HP’s set-top box.
2. WIND tends to maintain a more strictly RTOS and generic development tools position, with less involvement in particular application areas. Typically, they rely on third party developers to hammer out application-specific libraries that can then be reused by other developers including themselves. However, they got very involved in tailoring VxWorks for automobiles. They got extremely involved in developing IxWorks for use in I2O, developing an elegant abstraction of the I/O API to obviate the need for the traditional driver software. Notice also, that WIND recently won a set-top box design with Hyundai Electronic of America, meaning that none of these companies has yet conceded any particular application domain.
Where are they going from here?
Watch how each company handles the growing complexity of the market place. The number of future application areas is uncountable, and tailoring an RTOS to meet specific application needs, while maintaining all the different versions, and porting them all to the growing number of different platforms and their variants is a challenge of the first order. On the other hand, if any of the companies can dominate a particular application area, becoming the de facto standard, providing unbeatable functionality for that area, it can hit a home run without worrying about other potentially profitable areas. Pay particular attention to market share as measured by growing revenues and design wins. Both the number and application area of design wins is important. As mentioned earlier, as each of them makes acquisitions, perhaps expanding their business to aspects tangential to Embedded Systems, properly interpreting revenue growth will be difficult. |
