Hi Harry,
In November 1974, as the financial analyst covering the computer industry for EFHutton, I wrote a paper, "The Total Systems Concept, Applications and Implications". In that paper, and although only 2% of computers had communications capabilities in 1974, I accurately predicted the coming importance of data communications and the Internet. BTW, my paper also correctly forecast the advent of PCs, Communications Servers, and Storage Hierarchy Controllers. At the time I identified them as Logic Engines, but you may know them better today as Celeron, Deschutes, and Merced.
It was further my belief then, that the companies who could provide the most pieces of future Enterprise Inter-Company Networks, (i.e. E-Commerce Networks) would be the ultimate winners. The two companies that I believed who stood the best chance of dominating, and therefore ultimately controlling their own destiny, were IBM and AT&T. Of course, that was before IBM and AT&T were weakened by Justice Department interference,..but remember also many of today's major forces such as Microsoft, Compaq and Intel, didn't exist.
Several months later, in May 1975, I was invited to speak at the Computer Industry Association's annual meeting. There I presented the possible affects and implications of the "Total System Concept" on the smaller companies. Among the attendees at that presentation were Robert Noyce, Ryle Papa, Bob Bruick and many of the CEOs of the newer computer industry's developing companies. The main theme of my presentation was that because of the magnitude of the emerging "Electronic Information Handling Industry", joint ventures and consolidations would take place enabling smaller companies to have a future.
Today, almost 25 years later, I still believe in that same scenario.. i.e. the company, or companies, that can provide the greatest portion of products for the "Total System" will be the long term survivors. However, while many of these small companies have now grown into today's leviathans, they still can not do it alone.
So, with that as a background, let me answer your questions.
----"Who offers the best solutions?"
I believe today I would have to say..Intel/ SAP (Pandesic) along with Microsoft, and Cisco, are my top choices. However, I would also include several other companies who I am of the opinion are well positioned to be major players in this developing market. This would include, although not in any particular order, Compaq, Dell, IBM, EDS, Computer Associates, Computer Sciences, Lucent, AT&T, Worldcom/MCI, British Telecom, Travelers, Bank America, Citibank, Hewlet Packard, Oracle, Samsung, NEC, Sun Micro, and several others. All of these companies will have major roles, although, they will have to do it by consolidating into maybe 3 or 4 partnerships. I might add that this is why I have advocated here on SI that I believe that the Justice Department is taking too narrow a view of the marketplace in investigating Intel or Microsoft as monopolists. Just as they took too narrow, and short term, view when they broke up IBM or AT&T.
----"Who can service the customer better?"
Today CA, IBM, SAP, CPQ and EDS. However, I believe that MSFT and Intel via managed PC Networks are forces to be contended with as the importance of on-line assistance, via the Internet, continues to develop.
----" Now the comment by Pfeiffer as to why CPQ bought Digital, "We wanted the customers..." makes more sense."
Yes Harry, this was the type of consolidations that I am talking about. And yes I am convinced that Pfeiffer also sees the industry developing as I did.
----" Where do you see EDS and Computer Sciences fitting into this. Will they be able to survive alone."
No!!! These E-Commerce Networks of the future are just too large for any one company to be able to do it alone. Even if they had the diversification of product necessary, they lack the capital to implement it on their own. Of course if Lycos and AOL keep going up in stock price, like they have been recently, they might have enough money to swing it. (ggg)
Regards,
Jules |
