Wednesday, December 12, 2007

Postgres 8.3 is smokin' fast!

Stefan Kaltenbrunner has been testing and comparing the latest beta release of PostgreSQL 8.3 against PostgreSQL 8.2 and has some significant results to show.  Though the data is anecdotal, the results are fantastic.

POstgres 8.3 performance

Stefan's configuration information and simulation details are in his post, but here is a quote:

The benchmark database is initialized with a scaling factor of 100 (equals to 10M rows) which seems to be a reasonable size for a table in an OLTP style database.  All testing was done with 100 clients and 100,000 transactions/client which comes out to 10M transactions and an average runtime of about 1.5 hours.

Nice results.  You can see all of the details here.

And be sure to read the comments.  Here is a comment from a MySQL person who finally "gets it":

...when I write to the pgsql mailing lists, I get a response--and usually a VERY informed one--within an hour. Often within 10 minutes. Try getting that response time from the MySQL community on their forums online. You're lucky if your thread gets answered in that huge labyrinth of forums at all. As for the documentation, the website has a great deal of stuff, and whatever isn't there, just search the email archives (many such archives exist), and if that's a pain too, just drop a note to the pgsql list. You'll have an answer or excellent pointers more quickly than you imagine. I'm a recent convert to PgSQL (8.2.3) and while it took me a month to really figure things out and tune my database, I am simply amazed at the way things are structured, at the performance, and at the resilience/functionality offered by this stupendous db. (Having been a devout MySQL fan for over six years now). There's a reason a product creates passionate zealots.

Monday, December 10, 2007

Improving Google Adwords Results

In the world of B2B marketing, just about everything happens "on the Net" these days.  And Google is at the top of the list.  Adwords are being used to advertise just about anything and everything on the web today and our company spends a significant amount of money on Google Adwords.  The number of click-thrus is impressive, but some lower level analysis is needed in order to make sure that the clicks are valid.

Here are some insights that I have learned over the years from both my prior and current jobs.  Nothing is rocket science here, but it is often overlooked.  The best marketing is simple and well thought through. 

First things First.  If you are not breaking up your Google Adwords spend into campaigns, then you have no visibility.  Use campaigns to create a laser focus on WHO you want to attract and WHAT will attract them.  Assume you sell sporting goods and want to advertise footballs.  Instead of just targeting footballs. create different campaigns with similar ads and do some A/B testing to see which ads perform better.  Focus your efforts on a certain type of buyer - adults with male children ages 6-10.  Sounds difficult, right?  But, figure out where they go and then you will get better results.  Make a buyer persona.  Spend some time identifying what the hot buttons are for your customer.

For us, there are multiple hot buttons and they are clear:

  • They have been raked over the coals by Oracle and need an alternative
  • They want to use open source, but MySQL just can't get it done
  • They are using Postgres, and they need some help

Next, make sure that your ads don't just drop them on the home page.  This is probably the single biggest mistake that people make.  You have a targeted ad, you need to send the prospect to a targeting page.  That page needs to reflect the message found in the ad and need to provide some compelling content.  Back to the football.  Instead of dropping the prospect on your home page that may advertise lots of different things, send them directly to the page with the football.

And finally, give them something to do.  There needs to be a call-to-action and it needs to be "above the line".  When I say "above the line" I mean that the user should not have to scroll down to see the call-to-action.  Maybe its an offer to download your product or read a white paper.  In the case of the football, it should simply be a way to order the product right there.  Depending on the cost and complexity of the item, the call-to-action may or may not be a "Buy Now" button.

Check out your current Adwords campaigns and see if you have done these three things.  If so, great.  Now run some A/B testing and improve upon it.  Keep up with Adwords, change the ads frequently, experiment with different offers and call-to-action. 

If you are not, then spend the time to do it now.  You are throwing good money away.  You may get clicks, but I guarantee they leave quickly and never get your point!

Friday, December 7, 2007

In-flight Internet Access coming...finally

JetBlue will start a pilot program (no pun intended) to enable limited internet access on one of their planes next week.  Though the offering is on one plane and limited to 2 Blackberry devices, it is a move in the right direction. 

My life would be so much easier if I could do email on the plane and I would be so much more productive too.

I just hope that they don't allow cell phone voice communications.  While the idea that your cellular signal could interfere with the plane's operation is ridiculous (truly), I like the fact that I don't have to listen to 200 people trying to talk over the hum of the engines at 30,000 feet.  I think I would shoot myself!!!

You can read the article here.

Tuesday, December 4, 2007

Responding to the Register Article

I have not been blogging a while, simply because I have been so busy with work and family commitments that this site has suffered.  But, given the news publish today by the Register in the UK, I thought it was time I used this blog to talk about EnterpriseDB in a little more detail.

By now, I am sure that you all have seen the article.  If not here it is.

So, let me respond.  As Andy stated we are in our best quarter ever.  That is true.  It is also true that we have already far surpassed last year's sales.  In fact, we are calculating our growth in multiples as opposed to percentages. In 2006 we did millions of dollars of sales.  2007 will be x times that number.  By whatever standard you measure sales growth, that is fantastic.

Next, we now have almost 200 customers in less than 2 years of sales!  Some of the names we have talked about. Sony Online Entertainment, Sun, Vonage and FTD are the most notable.  Others are less known but just as significant such as:  Tomax, FortiusOne, Ticketline, Agri Stats, Atomogy, Proxicom, and xPrima.

And there are some we have yet to announce including:

  1. One of the Top airlines in the US has built their entire loyalty program on EnterpriseDB Advanced Server
  2. A $20 billion dollar public sector solution provider contracted EnterpriseDB for a multitude of large projects
  3. A leading provider of IPTV that boasts over 32,000 subscribers and 300 channels
  4. EnterpriseDB replaced Oracle as the database for a leading provider of Pharmacy Benefits Management (PBM) software
  5. The world's leading provider of mammography software for the most of the world's mammography machines, swapped out SQL Server for EnterpriseDB.
  6. Leading GPS monitoring company replaced MySQL with Postgres and EnterpriseDB and now processes 200,000 transactions/day and volumes of reads
  7. The world's number one online broker uses EnterpriseDB to support their Postgres implementation
  8. A publicly-traded, billion dollar insurance and financial services company uses EnterpriseDB for their Postgres support
  9. The world's leading high performance networking provider uses EnterpriseDB Advanced Server
  10. A social networking provider with over 50 million worldwide members uses EnterpriseDB for their Postgres support

And that is just the customer news.  There are so many other things going on including:

  • EnterpriseDB beat Oracle 11g for Best Database Award at LinuxWorld.  We have won this award EVERY year since our inception.
  • EnterpriseDB Advanced Server now works with both Cognos and Business Objects.
  • Our latest beta release includes more Oracle compatibility including over 2 dozen additional system views, bulk array and bulk binding capabilities and support for Oracle hints
  • EnterpriseDB contributed the single most-complex, and significant change to PostgreSQL in almost a decade.
  • EnterpriseDB Advanced Server is now qualified on AIX and z/Linux from IBM
  • EnterpriseDB is now qualified on HP-UX from HP

And, since I am the marketing guy, I will give you some insight there as well.  As Curt Monash can tell you, we are seeing huge demand for EnterpriseDB.  Our lead generation activities are resulting in a pipeline that is better than we have ever had.  And the types of companies that are in our pipeline include major ISVs and Fortune 50 companies from just about every vertical.

In 2007, we also started a regular set of training classes for both EnterpriseDB Advanced Server and Postgres.  They are very popular and almost always filled to capacity.

So, I have yet to answer the question that everyone is asking after reading the Register article.  "Why, then, did you get rid of some sales people?"

Here is my take (and if I haven't stated it before, I DO NOT SPEAK FOR ANDY OR ENTERPRISEDB.  THESE ARE MY OWN THOUGHTS.)

As with every start-up, you start out with a business model that is based not on real customers, but on the promise of real customers.  After a year of business, you evaluate what you learned and how you attracted your customers and you adjust.  You do that every year and every company does it.  The difference is that it is not as apparent with big companies like IBM who have been in business for years. 

So, what did we learn?  We learned that we are starting to turn a corner.  In the beginning we had no track record and just about every single deal required an on-site visit to a prospect to make them comfortable with this "start-up".  Now, we have the customers and references to back our claims.  And, we have learned a few things, mainly:

  • We do not need to visit every customer
  • Most customers are buying a smaller license up-front and then coming back in 1-3 quarters to buy a much larger license.

This is significant and why we are focusing more on inside sales and less on the outside sales.  Companies are able to download and test EnterpriseDB without a sales person.  They get comfortable with the software and make a small purchase to "try it out" in a non mission critical environment.  They make these purchases via the web or over the phone.  Shortly after the realize how good Advanced Server really is, they come back and buy a lot more.  At that point, we may send a sales person to visit them.  Its not that we don't care about them until this point.  Its that they don't need to be bothered with a dog and pony show when they can just go get the software themselves and test it and our support organization for FREE.

Make sense?  It does to me.

So, from a marketing standpoint, I want to get more companies buying the smaller licenses and coming back to purchase a larger license faster and we need a bigger inside sales force to do that.  Then, when a sales person does make a visit, they are going to a very well qualified customer, not just a lead.  Their job is streamlined, as is the business model for EnterpriseDB.

And the customer is happy because they can call us when they need us and we aren't hounding them with direct sales guys always trying to schedule a meeting.


I know this was a long post, but I hope you read the whole thing because this is important to me and should be to you as well if you care about EnterpriseDB for your business.  Besides, I haven't posted for a while, so I am making up for all of it at once...

Laugh of the Day

I have always contended that Gartner's style of analysis is old-school and caters to the laggards, but recently it seems to me that when it comes to open source, most within Gartner just don't get it.

Kudos to Matt Asay who calls this out in his blog.

It is no secret that Gartner mostly caters to the large, multi-national companies. And, in many ways, these companies are so risk-adverse that they will not implement new technology until it has been a standard for some time. I also feel that, when it comes to open source, Gartner is afraid of it mainly because many of the analysts never tried to understand it.

Their view of open source is conflicted even within the organization. Folks like Mark Driver "get it". Others do not.

I was even told by one analyst that:

"Open source is like communism and you see how well that did in Russia."

And that was less than a year ago! (Of course, he said he would deny saying it.)

In fact, here is a recommendation from a Gartner analyst at last year's Open Source Summit:

Begin developing skill sets for Linux as a production platform, especially for DBMSs.

They have really gone out on a limb there. To recommend that a company BEGIN to develop skill sets for Linux in 2006 is preposterous.

Below is another gem from Gartner. And you wonder why organizations are gravitating towards analysts that are more in touch like RedMonk, The 451 Group and Forrester.

"Unless you’re hiring the best electronic engineers and computer science graduates every year, you’re not ready to use open source in mission-critical areas"

CIO Magazine - April 3, 2007

Thursday, November 15, 2007

Ellison Strikes Again

Is it just me or does it seem like Larry is starting to become a little unglued?  Maybe he spends too much time sheltered from the real world, I don't know.  But, it appears as if the BIG news coming out of Oracle OpenWorld this year is not a major new product offering (a la Unbreakable Linux) or another major acquisition. 

The news, in fact, is that Larry became a bit unglued during this Q&A with the 40,000 or so CUSTOMERS in attendance.  Yes, I said that right, CUSTOMERS.  He berated many individuals who stood up to ask questions.  Is Larry so arrogant that he doesn't think he needs his customers anymore?  Does he think that he has too many customers and wants to dump a few?  Who knows, but here are few snippets of what happened, courtesy of The Register out of the UK.  The full article is located here.

First, it turns out the "open standards" SOA architecture of Fusion is not so open after all.  Besides some negotiations with IBM on supporting DB2 in financial services, Fusion users are forced to use Oracle as the underlying database...  So much for "open".  Sounds more like XVL to me (eXtreme Vendor Lock-in).

Then came licensing. A customer asked "will you reconsider licensing, because with every feature Oracle is becoming expensive"?

The problem, according to Larry, is not Oracle's per-user or per-processor charging - it's you, the customer, who's stupid for having lots of little licenses and for not buying in bulk with one license.  Larry would like everyone to go to the ULA (Unlimited License Agreement) no matter what size company.  He has no intentions of fixing his licensing model at all.  But, isn't that the same ULA that Gartner warns their customers about? 

The low point for Larry, however, was not related to any of Oracle's products, but a comment from a customer that at least he felt like when he gave money to Microsoft, a small portion might end up in the Bill and Melinda Gates Foundation and help fight disease.  Larry's response?  He cut off the customer comment mid-sentence with:

"Let me respond.  Bill Gates was very generous. He gave a lot of Microsoft stock to the foundation a long time ago and they sold the stock... If you think, when you buy a copy of Microsoft Office tomorrow, that the money is going to some guy in the Andes you're very much mistaken."

Kudos, Larry.  I hope this trend continues.  Because every customer that Larry alienates is another potential opportunity for EnterpriseDB to demonstrate our excellent customer service and plug-compatible database.  Take it from Jason Weiss, senior architect at who said,

"When someone comes in at a sixth the cost and 500 times the customer service that makes it very easy.  I need someone who's going to step up and not just reach into my pocket book. I'd definitely reach out to as many Oracle users as possible to get this [EnterpriseDB] on your system and prove it out".

You can read more from Jason here.

You may still need Oracle, folks.  But, a little EnterpriseDB Advanced Server sprinkled into your infrastructure will go a long way towards gaining some leverage with Oracle.

Monday, November 12, 2007

The Hawk Will Never Die

Today begins yet another exciting season of college basketball for the Saint Joseph University Hawks.  I graduated from SJU in 1994/1995 and have had season tickets since that time.  I have suffered through the hard years of John Griffin and got to bask in the glow of "The Perfect Season" in 2004.  I even managed to make it to the almost-final four game when Jameer missed a last second shot and we lost to Lucas, Jr and Oklahoma St. 

Each season is a new beginning, a clean slate, an opportunity for returning players to show improvement and new players to impress us.  I love the beginning of the season.  All the hopes, all the dreams. 

Many of my fellow Hawk fans do a napkin schedule before the season starts.  They realistically look at every upcoming game and figure out which ones we should win and which we should lose.  Not me.  Every game is a potential victory. 

Just like work.  Every sales deal is a potential win.  Every new employee is a rookie and every once in a while, there is a restart that allows everyone to refocus and show their A-game.  We are just entering the final days of this "season".  4th quarter is upon us.  Big wins on the horizon and a new season starts January 1.

For now, though, its the beginning of the basketball season and I am just going to enjoy that for a little while.

The Hawk Will Never Die!!!

Monday, November 5, 2007

Executive Advisory Council

I am off to Lansdowne, VA for the next 2-3 days for our annual advisory council meeting.  This is a 2 day event that brings our key customers together to discuss the future roadmaps for our products and get their feedback on a number of topics.  Last year was an excellent event and we gained a lot of insight into our customers' selection and usage of EnterpriseDB Advanced Server. 

This is a larger event this year, spearheaded by Garland Hall, our Chief Customer Officer.  Garland's job is to make sure that all of our customers' needs are met and to ensure that they remain our number one focus inside the company. 

I hope to share some insights upon my return.

Tuesday, October 30, 2007

I've been a little busy lately

There is lots of good stuff happening at EnterpriseDB these days.  I did a webcast with Curt Monash (Monash Information Services) last week and it was a whopping success. 

Curt is a well-known database analyst and always tells it like it is.

We had over 700 registrations and almost 400 people on the webcast.  In addition to the 50+% of attendees that were decision makers from Fortune 500 companies, I was surprised to see a lot of state and local government and non-profit organizations on there.  I guess I shouldn't be surprised.  They stand to benefit the most from open source because they have less money to spend and need to spend wisely. 

The webcast was about choosing the right database for your enterprise application.  You can view the webcast on demand here.

I plan to pick up my blogging pace now and you can call me on it if I don't...

Monday, October 22, 2007

You are just a tool!!!

I have been thinking about the tools that make my job easier over the past weekend and those that certainly do not.  Here is a brief list of those that help improve my personal productivity.

  1. Trillian - Instant Messaging is an essential tool for me.  It makes quick conversations from one office to the next easier, and for those of us who tele-commute, it is almost like being there.  But, I have folks on Yahoo, AIM, MSN, etc.  Trillion handles them all very easily.  Nice tool and the basic version is free.
  2. Windows Live Writer - I am currently managing 2 blogs.  In addition to this one, I also have a blog entitled Obsessive Compulsive Reef Disorder, which talks about my reefkeeping hobby.  Window Live Writer makes it so easy to post to both blogs in a single tool with  point and click ease.  Adding pictures, inserting links are all a piece of cake.  The fact that it is free adds to its appeal.
  3. Microsoft Office - Being in an open source company, this one is always under debate.  In fact, we used Open Exchange briefly.  But, the rest of the known world uses Outlook and I can't live without it.  Its not the mail that is essential because there are many ways to handle mail, but it is the calendaring.  I let Office manage me.  If its not on my calendar, I will miss the meeting, plain and simple.  And scheduling a meeting is a piece of cake, too.  You can see when people are available and schedule accordingly.  Don't see a real replacement here yet.
  4. PDA/Phone - I have been searching for the ultimate combo unit for a long time.  I have had the Treo 600, Treo 650, Treo 700p and Treo 700w.  I loved my Treo, but was not a big fan of the Windows version.  It had promise but I was constantly forced to reboot.  And to make matters worse, we implemented Good Messaging at work for a while which disabled my standard calendar, email and contacts.  That really became a nightmare.  Now I have the Blackberry 8830.  This is my first crackberry and I can see the addiction.  It just works.  It does not have a touch screen.  But, I miss that less and less every day.  I am hoping that the next generation of iPhones will move the bar even further and be available on Verizon. 
  5. Netvibes - Netvibes is a great web 2.0 home page.  It has slowly replaced My Yahoo for me.  I can add multiple tabbed pages and get all the information I need in one spot from news, sports, weather and stock info to manage my eBay account, pull RSSS feeds and search videos and images.  I can even track this blog through it and analyze web stats about our corporate site.  Check it out.

My new favorite software by far, however, is Clearspace.  Its not a personal productivity tool, but rather a collaboration software suite for your intranet or extranet.  I am going to dedicate a whole post to Clearspace.  But, you can check it out here.

Thursday, October 11, 2007

Do Open Source Developers Fix Bugs Faster?

A recent article from CIO Magazine discusses the recent surveys done by Forrester and Evans Data Corporation.

According to the Forrester Report (sponsored by BMC), the average time to resolve an application problem is 6.9 days for enterprise developers and 6.7 days for software vendors.

The EDC report surveyed the open source communities and found that the average time between discovery and solution of a serious bug is under 8 hours for 36% of open source developers!  However, 57% of open source developers say that typical (not serious) bug fixes take more than 2 days.

I recommend reading the article by Esther Schindler.  She gets into all of the complications that enterprise developers have to deal with such as meetings, prioritization, meetings about meetings, etc.

It is a worthwhile read.

Wednesday, October 10, 2007

Can you make money from open source?

The question asked below was:  Can open source software be used to create a successful business model and generate real revenue?

And the full answer was:

I am assuming that you are asking the question from the point of view of building a business based on open source software, not just using it within your organization. Given that, I think the answer is a very depends. And I would ask you if it matters in today's world.

For those that have been successful and profitable, look at the obvious ones, MySQL and Red Hat. Both very successful so far.
But, you also need to look at the ones that are not yet profitable that made out well via acquisition. XenSource was bought by Citrix for $500 million on $3 million in revenue. JBoss was purchased by Red Hat for $350 million and they were not yet profitable. Zimbra was just bought by Yahoo for $350 million on about $3 million in revenue.

The money is definitely there for sure. But, there are also a ton of open source start-ups who will never make it and the reasons are almost infinite. The two that seem to jump out at me are:

1. The open source project they are based on is too much of a niche product and has no viable market.

2. The team building the company does not understand the model and fails to execute.   As I said there are a million other reasons, but they are the two that jump out at me right away.

What I can say is that this is not like the internet boom of the late 90s. VCs are not throwing money at open source just because it is open source. They are looking for a solid business plan and a path towards profitability.

Another important question is how do you plan to make money? There are many models here.
1. Simply sell support for an existing open source product: Zmanda
2. Add value by bundling components to the open source project and sell support: Red Hat
3. Build your own open source product and sell it: MySQL
4. Take an open source product, add significant value and close source it: EnterpriseDB, IBM Websphere
5. Use open source components to lower your development costs and bundle it "invisibly" into your product: TiVo

The model matters just as much as anything else.

All my Answers are the BEST!

He says, tongue firmly planted in his cheek.  But, seriously folks, I have been doing this LinkedIn thing for a while and I find it to be an invaluable tool to find old friends and co-workers and to connect and network with others in my field.  A week or so ago, I decided to check out the "Questions" section and stumbled upon this question: 

Can open source software be used to create a successful business model and generate real revenue?

I found it to be right up my alley! It was asked by Angelo Varlotta, a PhD student from Purdue University.

Well, today I found out that he selected my answer as the "Best Answer".  Very cool.  He also sent me a nice email. 

So, I am 1 for 1 with question answering on LinkedIn.  I think I will retire now, undefeated!!!  lol

Tuesday, October 9, 2007

This Just IN: Postgres is FASTER than MySQL

Ok, for those you "in the know", you already know that this is true. But, it has been the conventional wisdom for a long time that MySQL is the faster database (at least for read-only environments).

Well, it seems that everyday there is more and more validation that MySQL is not a faster database. And here are some links:

Converted from MySQL to PostgreSQL - October 8, 2007

Postgres Publishes First Real Benchmark(SPEC jAPPServer) - July 9, 2007

Tweakers Database Test: Dual Intel Xeon 5160 - November, 13, 2006

We know that each environment is unique, of course. But, I think we can all safely say that Postgres can and does outperform MySQL.

So, what does MySQL bring to the table? There are comparisons all over the net. Pay attention to them, however, because many are outdated and compare older versions of both Postgres and MySQL. (This tends to hurt MySQL more).

A recent and fairly decent comparison was led by Greg Smith and the PostgreSQL community a month or so ago and can be found here.

But, for those of you without the time, let me help. Here are some benefits of using MySQL over Postgres:

  1. With MySQL you aren't limited by those newfangled technologies like Multi-Version Concurrency Control (MVCC).
  2. With MySQL, you are also not limited to those unbearable and strict rules of the calendar. You can easily add dates to February to make it conform to other months like February 31 (and January 32 for that matter).
  3. With MySQL you get CHOICES. You can get Foreign Keys (InnoDB) OR you can have Full Text Search (MyISAM) OR
  4. you can do clustering (NDB), but you have to choose only one because each of those lovely features is found in different storage engines.

I could go on and on, but I think you get the point. So, why is MySQL so successful? MARKETING. PostgreSQL is a true community with no company and thus no marketing engine behind it. All of the success of Postgres is through word of mouth or the companies around it like EnterpriseDB.

MySQL spends a lot of time and money marketing their offering. Its time for people to see through the marketing and go with the only REAL open source database, PostgreSQL.

Monday, October 8, 2007

Why Subscription pricing is better for you and your customers

In my last blog post, I talked about the hockey stick and I mentioned that changing the licensing model for software can help eliminate the hockey sticks in sales.

I want to talk a little more about the subscription model because I think it is the way all software should be purchased.

In a perpetual model, the customer pays a huge up front "license" fee and then a yearly maintenance fee, typically 20-25% of the license fee.   In a subscription model, the yearly charge is the same.  There is no up-front "balloon" payment.

Let's look at this first from the ISV standpoint and then from the customer side. 

What this means for an ISV:

  1. PLUS:  In a typical subscription model, there is a recurring revenue stream generated that can be depended on year after year and therefore the business can be planned better.  There are less peaks and valleys because of a missed deal.
  2. MINUS:  The growth rate is slower because ISVs do not get the initial spike of revenue from the license.
  3. PLUS:  You may sell more because the yearly subscription is much lower than the up-front license, so therefore most companies can justify the expense. 

What this means for a Customer:

  1. PLUS:  No capital expenditure.  This means the decision to buy is not left in the hands of the accountants and thus the software can be purchased faster.
  2. PLUS:  Dependable budgeting because the price does not change from year to year.  Need to add more licenses?  Simply pay a little more.  No need to delay because of high licensing costs.
  3. MINUS:  Depreciation is not really an option at this point.  So, if your accountants were counting on writing down that "major" software investment, no such luck.

It is taking companies time to come around to this model because it is not something they are used to.  The reality is that it creates a partnership between the ISV and their customer.  The ISV wants the customer to do well so they will continue to use the software and possibly need more.  The customer has not been raked over the coals and therefore feels better about the relationship with the ISV.

By the way, this is also very similar to the Software-as-a-Service model with only one exception.  In SaaS, the application is hosted. 

Monday, October 1, 2007

Hockey Sticks and the Software Business

Well, another quarter is "in the bag" and its time to take a breath and pause if only for a second...  

Now, get back to work and do it all over again. 

One of the most interesting phenomenon in the world of software is the dreaded hockey stick.  For those of you who are unfamiliar with this phenomenon, it is the seemingly unavoidable scenario that results in 98% of your sales coming in at the end of the quarter.  While this happens in many different industries, it is very prevalent in the software business.   Below is a chart that shows the hockey stick in action. 


Why does this happen?

  1. The incentives of the sales team encourages it.
  2. The fiscal quarter end of your company encourages it.
  3. The fiscal quarter end of your customer encourages it.

The problem is that, in many cases, all of the above are aligned.  This alignment leads to the hockey stick.  Re-aligning the three items above can help to minimize the hockey stick, but it will not make it go away.  Companies have tried for years and they have paid consulting firms millions to avoid it, but it is almost impossible.

What does the alignment do? Well, for one, your sales people will do everything they can to close deals before their clock resets.  That means they want to pull in any deal they can before the end of their measurement period.  Some companies have tried capping the comp plan, but that is not a good idea because then sales get pushed out causing a whole new range of issues. 

The second and third bullets are linked together.  Most companies follow a fiscal year that matches the calendar year.  They know that you do too.  So, they know that they are likely to get the best deals if they wait until the end of your quarter to sign.  They know that you will pull out all the stops to close that deal.  Combine that with their fiscal quarter and you end up with a HUGE hockey stick at year end.  Why?  Well,they have budgets that they have been holding on to.  They need to spend that money before year-end or they risk losing that budget next year. 

The combination of two and three are catastrophic to both businesses and personal lives.  Businesses can't plan and personal lives are ruined due to the fact that everyone has to work twice as hard from Christmas to New Years (when everyone ought to be off).  Not to mention the stress and the heart attacks that it causes. 

How do you fix this?  I am not sure you can.  But, you can mitigate its impact.

1.  Change your incentives to sales people.  Don't give them all the same quarter.  Make Tom's year end in May, Leo's in August, Mary's in March, etc.  This way they are closing deals all year.  Is this a new idea???  You tell me.  I have never seen it done, but no one could give me a good reason why not.

2.  Change your fiscal year-end.  My first employer did this (QAD) to lessen the December 31 hockey stick and it worked somewhat.

The best way, in reality, to avoid this is to change your business model. Part of the problem is the way software is licensed.  The traditional software model of a huge up-front license fee and recurring 20% maintenance helps to perpetuate the model. 

If there is one thing to be learned from open source and software-as-a-service (SaaS), its that a subscription model is the preferred way to sell software. But, that is a topic for another day.

Friday, September 28, 2007

eBay was Hacked and I was almost a victim...

So, I was selling a Sony PSP on eBay and about 10 minutes after the auction closed last night I received the following email:

Real eBay Email

So, fine.  What a pain.  I thought it was because of some kid getting a hold of his parent's eBay account and not asking permission.

Then I get this email late last night: 


Fraudulent Email

What is interesting is that the second email (from PayPal) is really NOT from PayPal.  How do you know?  Well, there is an image missing for one.  Two the links are not correct and three, Why would Mark Wilson want me to send something to Nigeria?

Also, read the note about how the amount won't show up in my PayPal account until after I send them a tracking number and the email address is not an eBay or PayPal address.

Its not a bad scheme, but anyone who pays attention will see through it quickly.

Rumor has it that many many accounts were hacked earlier this week.  But, there was no press from eBay.  I guess they are trying to keep this one quiet.

Lewis Cunningham has a post about this on his blog as well.

Wednesday, September 26, 2007

Mr. Ellison, Please Check Your Ego at the Door

Larry Ellison has arguably one of the biggest egos in the business world today.  He may even hold the title now that Mark Fleury has left JBoss.  While there are other high profile CEOs out there, Bill Gates and Jeff Bezos come to mind, no one is as egomaniacal as Larry. 

Sure, he has good reason.  Oracle has continued to produce stellar results.  He has done this through successfully integrating big ticket acquisitions that have hobbled many other companies (HP/Compaq comes to mind). 

But, in a recent article from the Motley fool, Larry blasts SAP and for their web-centric offerings claiming that this market is a bust.  His reasoning is solid TODAY.  Software-As-A-Service (SaaS) is a lower margin business.  TODAY.

This smacks of the arrogance that almost brought IBM to its knees in the 80s and helped Microsoft take its eye off the ball in recent years.  You can't be arrogant and wear blinders at the same time, Mr. Ellison.

The world is changing.  SaaS IS the next thing.  Google knows it and continues to capitalize on it with its Google Pack offerings that now include on demand versions of Word, Excel and Powerpoint.  SAP, a company that I typically consider a late majority company is innovating in this area. IS making money here.  As are others. 

EnterpriseDB customer Tomax, a large ISV for the retail space, now offers much of their solution in a SaaS environment.  (An interesting side note to the Tomax story.  Oracle was an initial investor in Tomax and Oracle was/is the underlying database for their solutions.  But, Oracle bought their largest competitor, Retek last year, transforming Oracle form an ISV partner to ISV competitor.)  You can read more about Tomax and their offering here.

Arrogance is fine in many cases.  But, coupling arrogance with a myopic view can hurt you badly in the long run.

SaaS is a growing trend and not a FAD.  Wearing your jeans halfway off your butt is FAD... I hope.  Disco was a FAD.  Client/server computing was not a FAD. 

And it might just be replaced by SaaS.

Tuesday, September 25, 2007

EnterpriseDB High Availability Webcast

Tomorrow, I will be the master of ceremonies and co-presenter for a webcast with Continuent.  Jim Mlodgenski, VP of Professional Services for EnterpriseDB and Robert Hodges, CTO of Continuent will be discussing High Availability in a webcast entitled "Building a Highly Available Infrastructure for Your Database and Application".  This webcast will be at 9am and 2pm ET.  I encourage you to attend.  You can register and find out more information here.

Halo 3

Well, today is the big day!  At midnight, stores across the country began selling Halo 3.  Microsoft's head of gaming was quoted as saying that this should be the largest entertainment event in history.  What does this mean?  Their goal is to make more money in one week than the reigning champion, Harry Potter.  For the record, the latest Harry Potter movie did $155 million in one week.  It is not outrageous to think that Halo 3 could surpass that, especially at $59.99 a copy.

So what does this mean for the gaming console wars?  Well, it helps to solidify Microsoft's XBox 360 as the one to beat.  That is yet another example of how Microsoft can enter a mature market and simply take it over.

They did it with Windows and then Microsoft Office and then they did it again, beating out Netscape with Internet Explorer.  While many argue that open source will hurt them in those markets (Firefox is gaining market share daily), the reality is that they have continued to innovate across the board.  While point solutions like Firefox may take some market share, there is no other company that has the range of Microsoft, from personal computing to your living room and from there all the way up into the Fortune 100.  Name me one company that can come close. 

Google? - Sure, they may own search and they may be nipping at the heels of Microsoft Office, but they still don't have the breadth and depth.

Oracle? - Not even close.  They are fully focused on the enterprise stack (Linux, 11g and their applications).  I don't think Oracle will ever enter my house.  (Notwithstanding the fact that I am an Oracle competitor and its in my DNA to dislike them.)

And, if Microsoft could spend some more time on the Media Center side of Vista to make it as easy to use as the Mac and brain dead simple for interoperability with cable and satellite boxes, etc, then that war will be over as well.

I have multiple Media Center PCs in my house, including my family room.  Though I do not have the Vista version yet, I can tell you that it is great for a geek like me, but not yet ready for my wife who just wants to watch/record tv or play some music.

But, I digress.  I am actually just wasting some time before Best Buy opens so I can go get my copy of Halo 3!

Wednesday, September 19, 2007

Calling Bullsh*t

The last time I saw a post with this title, Dave Dargo was calling bullsh*t when Oracle announced that they were going to provide Linux support as in, Yeah right, that's the problem, its the OS that's so damn expensive.

But, I am calling it for an entirely different reason.  What is up with companies that publish completely ridiculous press releases?  I am not going to tell you who the company is because they don't even deserve a mention, but here is a brief list of their newsless news: 

1.  In April, ABC Corp. announced that they were now a partner with a major player in the market and the supporting quote comes from the head of the major player's independent user group (which is a substantially large organization in and of itself)  Sounds important, huh?  NOT.  Turns out that they signed-up on the major company's website to be a partner and paid the $1500 fee.  End of story.  But, surely the supporting quote is something, huh? See next item.

2.  One week later, ABC Corp announces that the head of that independent user group has been named to the board of directors of ABC Corp and he becomes the mouthpiece of the organization while retaining his presidency of the user group.  (Ahhh, the bullsh*t continues)

3.  In May, ABC Corp announces the creation of a major consortium and has 4 founding members.  In this press release, they flaunt their "partnership" from above.  But, yet the other company refuses to acknowledge them.  But, still we are getting somewhere now, right?  Not really, read on.

4.  In July, ABC Corp announces that the Consortium is complete and it has major members but won't name ANY.  Oh, and it becomes clear that this is not a consortium, but rather a sales strategy.  All consortium members are going to pay ABC to have them do their voodoo.  Oh, wait, they also announce that this new "product" which they have been flaunting since April won't be delivered until the end of the year.

5.  And the coup de grace, ABC Corp announced that they would be presenting at the sales kickoff for the major company of which they are a partner.  WOW, I must be wrong.  There is something here, huh?  NOPE.  This company is sooo big that they actually have an exhibit hall for their sales kickoff and any of their partners can exhibit there for a fee.  (I told you they were a major company.)  So, there is no news here either.

Meanwhile, they have booked a whopping $90,000 in revenue for the first six months of the year.  Yep, you read that right, $90,000.  Oh, did I mention they were a public company?

Monday, September 17, 2007

Your opinion... is irrelevant.

A long time ago, in a galaxy far, far, away, I took a class from Pragmatic Marketing ( that was for product marketing folks. It was an excellent class as far as I can remember, but there was nothing earth shattering about it. What was great was the ability to take 2 days away from your job to think about your job. Yep. Because Pragmatic marketing is pragmatic, they have build a framework that allows product marketeers to analyze what they do to see how they can do it better.

They make you realize that it is imperative to stop and think and gather outside information in order to do your job. Too many people in product marketing are busy "doing" that they don't spend the required time to "understand" the market and, as a result end up "doing" it again and again with the same results.

Which leads me to the title of my post. Pragmatic Marketing sells mugs, t-shirts, mouse pads, etc. with a very important message:

Your opinion, though interesting, is irrelevant.

What a great statement! It really is the truth. When trying to decide just about anything in product marketing, my opinion is only as good as the information I base it on and 99 out of 100 times, the opinions of a sales person, a development guy, a customer support rep, the head of finance, the CEO, CTO, COO are all irrelevant.

But, it is one of those absolutes that is almost always wrong. Each of those people (with the possible exception of the head of finance) has very important information IF they talk to and LISTEN to the prospect or customer. Each one of these folks talks to a customer at a much different point in the engagement. Some conversations are first impressions, others are during the sale, some right afterwards and ongoing and others talk about the future potential.

So, everyone has valuable information, the trick is getting them to give it to you without spoiling it with their irrelevant opinion!

Saturday, September 15, 2007

Where were you when? (SCO)

Everybody remembers where they were when they found out what was happening on September 11.  I will certainly never forget. 

But, my question to you is where were you when you found out that SCO was suing the world over IP claims in Linux? 

I was in a rather unique position.  SCO was a major partner for Unisys. Unixware ran on the ES7000 server line and I was responsible for the partnership from the Unisys side.  I was also quietly shepherding in Linux on the ES7000.  (Up until this time, Unisys was beholden to Microsoft and the ES7000 only ran Windows and a little Unixware.)  And, believe it or not, SCO had joined the United Linux Consortium (along with Connectiva, SUSE and TurboLinux) and Unisys had just begun quietly shipping SCO Linux on the ES7000. 

So, on a Friday morning I deliver a presentation to a major customer about United Linux and our 15 year partnership with SCO and Monday morning I am on the phone with John W., our rep at SCO (who was just as blown away as everyone else in the world) asking what the deal is.  BTW, I changed John's name to protect the innocent.

So, here is what John tells me: 

Well, we will honor any deals you have in flight and we will continue to support the handful of existing SCOI Linux clients you have.  But, we are discontinuing the sale of SCO Linux immediately and I can't guarantee that we won't sue those customers eventually.

Yeah, right.  So there I am in the middle of a sh*t storm and caught between sales reps and customers and not a clue how to proceed.  Incidentally, SCO's stock was somewhere between $.90 and $1.35 at the time and I remember thinking I should buy a few shares.  They subsequently went through the roof in the next 90 days hitting a high in the low $20.00 range.  But, alas, I never purchased. 

I did, however, spend the next 3 months talking prospects, customers and internal management off the roof.  Everyone seemed to think the sky was falling.  And, since then it has been a wild ride...

What really got me was that SCO was offering Linux (SCO Linux 4.0 powered by United Linux v1.0) and now suddenly it was"their" code and they were going to pursue everyone who worked on Linux or used it to run their business (including those they had sold SCO Linux to?).  Ridiculous. 

Thanks for the memories Darl.  At first we were scared, then we were annoyed and then we just laughed. 

Friday, September 14, 2007

Hello World!

I decided it is finally time to start a blog (and follow through).   What is the subject of this blog?  While I wish I could properly define the contents of the blog, I think it will define itself over time. 

I can tell you that this blog will be a mash-up (if you will) of my work, the overall technology market (especially open source) and my personal life. 

What work? Well, I am the Director of Product Strategy at EnterpriseDB.  If you have any Oracle databases, then you should definitely check us out.  EnterpriseDB Corporation  We are also the world's largest Postgres company and I have a feeling that I will be spending a lot of time on that it in the near future.  Need a little info on Postgres (or PostgreSQL as it is called by the community?  The Postgres Resource Center

What personal life?  Well, there is a ton there.  I just had a baby boy on September 1, 2007!  Well, my wife did :)  But, more than than just talking about my wife and three beautiful children, I will try to stay on topic with personal issues as they relate to business.  But, who knows that may change.  I won't talk about my fish tank.  You can go here for some of that.

So, who am I?  Here is a little bio that I copied from someplace...

"Derek M. Rodner is currently the Director of Product Strategy for EnterpriseDB. Prior to joining EnterpriseDB, Derek held a number of marketing roles at Unisys Corporation, all related to Open Source and Linux for the Enterprise Server division. He was responsible for launching Linux for the company. In addition, Derek was the first elected Chairman of the DCL Marketing Board for Open Source Development Labs (OSDL), home of Linus Torvalds. Derek was also the founder and president of a business re-engineering firm for Fortune 500 companies."

More to come...