Corel-Inprise Merger: Union of software chameleons

Corel-Inprise Merger: Union of software chameleons

The merger between Corel and Inprise/

Borland could signal yet another change for the chameleon that is Inprise, raising questions about the company's commitment to Windows development tools and generally to platforms other than Linux.

Partly as a result of layoffs during lean times and partly due to attrition tied to the company's instability, Inprise's product development has lagged in recent years, according to some observers.

That drop-off is one reason the combined company is pinning its hopes on the contributions of the Linux community.

It is unclear, however, how the company will handle its many tools and middleware partnerships with the likes of Oracle and Novell.

Given the stated focus on Linux, questions have been raised about Corel/Inprise's commitment to Inprise's Windows tools, beyond whatever is needed to craft a Windows-to-Linux migration strategy.

Besides the inherent risk in committing to an uncertain market, the merged company also has to prove to customers that support will be adequate, according to Jeff Tarter, editor of The Soft Letter, an industry newsletter based in the US.

"I am not sure there is a real market for Linux desktops. People [like Corel and other Linux distributors] with server operating systems seem to have this death wish to compete head to head with Windows. No one has ever done it successfully," Tarter said.

"Corel does have a serious support problem. Part of the problem is they inherited the WordPerfect applications and a user base that expected great and free support. But what did they do? They started charging for it and producing [inadequate] support. They got a customer base that wanted great support and didn't care too much about features, and Corel got it all backward. Their support is miserable," Tarter said.

According to observers, in light of Corel's emphasis on desktop Linux, the extent to which server-side Linux and attendant middleware and tools receive their due also becomes questionable. In other words, they question whether Corel will vigorously promote Inprise middleware and enterprise tools, such as the tools that facilitate the coexistence of Microsoft's COM and the Object Management Group's CORBA architectures.

Only the VisiBroker ORB seems safe in any post-merger stock-taking according to some observers, who noted that Corel stands to gain by bundling its eventual Linux server with Inprise tools and middleware.

Considering the diverse paths of these two companies, both of which have undergone numerous transformations and rebirths, the merger warrants a look at the partners' lineage.

Over the past decade Corel has shed its skin several times to better fit in with whatever operating environment was in fashion. While its current hardcore drive into the Linux market looks promising, the company has never quite broken into the top tier of desktop applications players, despitefervent attempts on multiple operating systemplatforms.

Founded by Michael Cowpland in 1985, Corel made its first breakthrough with a version of CorelDraw in 1989 for DOS. However, the com-pany did not begin to make any significant headway until 1992, when it delivered the industry's first all-in-one graphics suite, CorelDraw 3.0 for Windows 3.1.

Again trying to be first to market on a new platform, the company launched the first major 32-bit application for Windows 95, CorelDraw 6.0 in 1995.

During this time the company dabbled in some fringe markets delivering versions of its core products for IBM's OS/2 and Unix-based desktops, but had little success there. Corel also delivered the first graphics suite for the Power Macintosh in 1996, CorelDraw 6.0, which fared better.

The following year Corel made a bold move attempting to get into the office productivity market by acquiring the almost legendary WordPerfect series. The company put a lot of marketing muscle behind the venerable product, which many observers even then thought had seen its best days, particularly in light of the rocketing sales of Microsoft's desktop Office suite. Corel then added Borland staples Quattro Pro and Paradox to its productivity suite, which represented the first dealings between the two companies, but those additions did little to help build momentum against Office, keeping the company's market share percentage well down in the single digits.

The company then shifted gears in an effort to capitalise on Java's popularity, announcing a couple of years ago its intention to deliver a pure Java version of its productivity suite.

The company delivered the product to beta testers, but just before it was to launch the finished version, it cancelled the project, selling off pieces to GraphOn.

This was perhaps a prescient decision given that the market for pure Java-based versions of major applications has failed to materialise.

Finally, after trying on a variety of operating systems in an effort to find its niche, the company seems to have settled on Linux.

With a firm commitment both at the desktop operating system and applications levels, Corel appears to have its best chance yet at grabbing significant market at both. The company recently reported that it has recorded just over one million downloads of Corel WordPerfect for Linux. It has also generated over $US3.2 million in sales for the desktop version of its Linux operating system since November.

While not exactly a giant killer, Corel has proven to be a worthy adversary to Microsoft, according to Tarter.

"Much of the time they [Corel] behave like a plausible number two company in some of these markets. They will never displace Microsoft, but they are generally good at going places where Microsoft can't go," Tarter said.

"One of those places was into bargain pricing, because Microsoft can't cut its prices across the board to compete. They continuously find points of vulnerability at Microsoft. Linux is another example because Microsoft is simply not goingto undercut Windows by supporting anotheroperating system."

However, Corel faces a tough challenge in head-to-head competition for customers, according to Tarter.

"It isn't always about market share. You can always win market share by picking up customers that the number one company doesn't want. The question is, can you make a living from just picking up and servicing marginal users? It is like running a delivery service, making sure you go to places that FedEx doesn't - like Indian villages or hermits in cabins out in the woods," Tarter said.

Inprise, formerly Borland International, is also a company that has reinvented itself frequently during the last half-dozen years, mirroring many of the major shifts in the software industry that have altered Corel's course.

The company was founded in 1983 by flamboyant mathematician and jazz musician, Philippe Kahn.

However, management has never been seen as the company's strong suit, and Kahn was event-ually forced out, first as president and then as a board member. The move, which was attributed to Kahn's lack of business acumen, may have been an early sign that the company would have a hard time blending in with a turf coveted by Microsoft.

From Borland's beginnings as a tools, database, and spreadsheet company, through its acquisition of enterprise middleware and focus on Java and Linux, the California-based software firm haswon praise for the quality of its products, andhas engendered strong customer loyalty, whilefrequently suffering defeats in the marketplace.

Borland was credited with helping to pioneer visual development and client/server models of programming, with tools such as Delphi, dBase, and Paradox.

After suffering at the hands of Microsoft in the desktop productivity and visual development tools markets, the company acquired middleware vendors Open Environment and Visigenic Software. The move signaled a turn upstream into the enterprise development and infrastructure space, and the company found success with Visigenic's VisiBroker object request broker (ORB), which has been licensed by numerous vendors and commands a significant installed base.

Borland/Inprise has also seen the insides of numerous courtrooms, typifying the industry's litigious side.

The company fought well-publicised cases against Lotus (concerning spreadsheet menucommands) and Microsoft (over the latter's energetic recruitment of Borland/Inprise talent) and defended shareholder litigation.

One user organisation pleased with the merger is the Ohio State Department of Transportation (ODOT), which has been moving away from mainframe development and using Inprise's Jbuilder product as a way to ensure it doesn't get locked into a single development environment.

"We've pretty much come to the conclusion that this is not an abandonment of Windows but an affirmation that they'll be able to hit multiple operating systems," said Angelo Serro, a technical lead at ODOT. "We still know their products are very solid on the Windows side of the fence."

In addition to an affirmation of Inprise's strategy to branch out beyond Windows, Serro said, the merger affirms his commitment to the company's Jbuilder product.

"This merger has made our management a little more comfortable with the direction of our development," Serro said. "We know now that if the government were to step in on Windows and make it untenable to us, we could pick up our Jbuilder development on Solaris or on Linux. It gives us yet another choice, another parachute."

Additional reporting by Michael Lattig.

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