DEC, SGI, and now Sun...

(reposted from a post to the Sun Microsystems Alumni group)

I am rapidly coming to the belief that companies (and individuals) in the technology business want to be rich, happy, and long-lived, and the best you can do is choose about one and a half of those three.

If you want to be happy and live a long life, I think the company to emulate is Falafel's Drive In. Not what one might consider a tech company, but I don't know of anyone in the valley who hasn't eaten there, because they've been there for at least thirty years. I'm willing to bet there are no billionaires there.

What happened to each of these companies, IMHO, is that they were unhappy until they got rich. When they were rich, they wanted to be happy, and so they were. However, if you get to be rich and happy, your life expectancy goes down dramatically in this business, and so they all died (and I do consider Sun, alas, to be on life support with no real chance of recovery).

To be less abstract about it, each of them set out to build something better than was previously available - an undertaking born of unhappiness. These three companies were each successful and became rich. Once rich, they wanted to do what we are taught in business school: build barriers to competition to product our frachise. So they each used their own chips (made Intel unhappy), their own operating systems (made academics, already accustomed to the openness of BSD UNIX, unhappy), and their own parts, service, and support mechanisms (made small vendors, service providers, and do-it-yourselfers, like Google, unhappy). This meant they were rich and happy, which made unhappy people (in the case of Sun, they were Intel, Linus Torvalds, the PC vendors like Dell, and lots of others like Google) focus their unhappiness on Sun. Sun, being happy, chose to believe that toy computers and home-made operating systems could not possibly be a threat to them, just as
DEC had believed that silly workstations with their cryptic UNIX operating systems could not be a threat to minicomputers and SGI had believed that toy "personal" computers with their pokey data buses and little graphic cards could not be a threat to them.

I think there's an important discipline that good managers (as I at least imagine myself to be) have. It is easy and feels good to look at the product and thinks about how good it is and focus on all of its strengths. A good manager, IMHO, looks at a product and thinks about its shortcomings, what competitors might do to attack it, and how to make the next product make up for those weaknesses. Most importantly, one should look at the product's revenue streams and try to figure out how to cut it in half or less as quickly as possible. Why? because it's what your competitors are doing. It's a miserably unhappy existence, always leading to your company being less rich than you think it should be. But it's the only way to live a long life as a tech company.

Interestingly, the only "tech" company that seems to understand that is IBM. And I'll bet every IBM employee thinks IBM stock should be trading at $200-500 per share instead of the $100+ it's trading at now. Not very rich, not very happy, and living a long life.

As we work to get Ayrstone off the ground, I'm watching my former employers (Sun's only one of them... I have lived a charmed life in this regard) collapse, I cannot help but think about these issues and how to get around them. So this is what I believe today: if you want to live a long life, stay poor and miserable.