Comment by Centigonal
5 days ago
Love you Bryan, but:
> Companies that have disdain for their own customers will be reviled in return. Such companies may be able to thrive in the short term, but they do not endure in the limit.
Oracle has endured nearly 50 years. Sun did not endure.
I don't want to live in a world where one of the most successful and widespread corporate strategies is also disturbingly un-humanistic, but we're never going to find a better way unless our mental models for how customer relationships map to business success actually align with reality.
Appreciate the love, but I think you are drawing the wrong conclusion here: Sun failed to endure not because it loved its customers, but to the contrary because it lost track of them: the company was disinterested in the mechanics of running a business.[0]
As for Oracle and its putative endurance, I would liken it to the Berlin Wall: despite the seeming permanence, it is in fact an artifact that history will be eager to forget when given the opportunity.
[0] https://news.ycombinator.com/item?id=2287033
Per above, it seems like Sun had a core architectural, technical, and engineering failure with SPARC failing to keep pace with x86, and a business failure dealing with the fallout:
> x86 boxes were starting to smoke the hell out of UltraSPARC.)
> we spent too much time trying to help save microprocessor management from an unmitigated disaster of their own creation (UltraSPARC-III, cruelly code named "Cheetah"
In contrast, HP mostly (though it eventually split into two companies) managed to survive Itanium and compete with Dell. IBM continued to evolve Power and its other architectures and still sells AIX as well as Linux systems. Cray still exists as part of HPE. Apple migrated from PowerPC to x86 before hitting a home run with their own version of ARM.
In an alternate timeline, I imagine Sun still existing as an independent company and being the leader in RISC-V systems. But I guess Oxide is something of a successor?
Sun being the leader in RISC-V systems
If Sun couldn't design a good SPARC processor then they couldn't design a good RISC-V processor either. x86 was really their only hope but they didn't succeed there either, maybe because of the same old over-engineering.
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Given how Fujitsu was able to make competitive SPPARC64 models for Oracle, it was unlikely to be an ISA issue, and more a design and manufacturing issue....
> As for Oracle and its putative endurance, I would liken it to the Berlin Wall: despite the seeming permanence, it is in fact an artifact that history will be eager to forget when given the opportunity.
Sparkling wine bottles are sometimes popped when the last installation of Oracle gets retired in an organization.
No love for customers will compensate for a missing strategic moat. Sun placed its hopes on vertically integrated hardware + proprietary OS. Oracle bet on software, that once installed, had extremely high switching costs (similar to SAP). Strategy >> Love.
> Companies that have disdain for their own customers ... do not endure in the limit.
This is a very common sort of wishful thinking that lets people bypass hard decisions. You create a company that loves its customers and employees and vice versa because you want to run a company that way. There are plenty of examples showing it's possible to run a sustainable business that way, and also plenty of counter-examples. There's no guarantee that it leads to business success or maximizes profits, it's just a choice you make.
The next sentence is more defensible:
>> Certainly, these companies not endure as innovators: when coercion is your business model, innovation is not merely unnecessary but actively antithetical.
Oracle and VMware do seem like just rent seekers. I'm sure those rents do pay for plenty of nice things, but it's really hard for me to ever understand Oracle or VMware as an "innovator", beyond their initial innovations (their flagship DB, x86 virtualization).
> Oracle has endured nearly 50 years. Sun did not endure.
IMHO it's perfectly fine for companies to live well, and then be sold. AFAIAC persistence is only proof of persistence. Sun created plenty of wealth/millionaires too. And, by Bryan's lights, it did so mostly ethically. That's a good life.
I think that companies like Oracle and Broadcom begin to resemble specialized private equity firms: they acquire innovative companies that have scaled to a level that they're familiar with. The acquirer then enforces "business discipline" and unlocks efficiencies (mainly this means leveraging the acquirer's existing connections with their customer base to cross-sell licenses, raising prices to the highest possible level their customers can sustain, and laying off/transferring redundant positions or positions not directly tied to revenue generation). This lasts 3-10 years until the market develops a lower-cost enterprise-ready alternative that starts to erode the captive customer base, but in that time these companies have collected enough rents to acquire another set of smaller companies and repeat the process.
> I think that companies like Oracle, SAP, and Broadcom begin to resemble specialized private equity firms
This is an entirely fair/accurate. I suppose what I am getting at is that these are just 2 different business models, and, the world can sustain a multitude of business models. There need not be only one (har har).
It's also fair to believe there is a moral dimension to one's own model which doesn't extract maximum value from the customer. Because IMHO "let's kick them in the dicks again" isn't an especially likable model, even if it is successful, and it's fair to avoid doing business with such people.
Imagine trying to sell your partners on doing business with Broadcom. If your core principle is "Broadcom needs to be around in 10 years", maybe the persistence/"kick them in the dicks" model is appealing, but otherwise, its fair for their competitors/Oxide to point out how awful dealing with a corporate sociopath might be.
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Literally clicked to the comments to say exactly this. While I agree with the overall sentiment of the piece, this statement destroys the author's credibility.
> Oracle has endured nearly 50 years.
CIA contractors be like that sometimes.