August 20, 2007

CodeGear CEO Clarifications

In response to my open letter to Tod Nielsen, I got a very interesting email from CodeGear CEO Jim Douglas, so I asked him permission to quote it on my blog.

First of all, it was a nice surprise to receive a long and detailed email only a couple of hours after publishing my blog post. The email has a very informal tone, with general comments about my blog and other direct information I'd rather omit. As Jim later told me, it was meant to be personal, not public. However, as the matter touched by my post is relevant, he agreed with my request for posting some quotes from the email.

In the email, Jim acknowledges that investment in the tools business by Borland was limited in past years, and that his role is to "focus the organization on the needs of the development community and return the company to growth".

The Quarterly Results

The mail has two key points. One is on Tod Nielsen (Borland CEO) comments to the quarterly results. Jim Douglas says he is "a very competitive person and reading the comments in print certainly wasn't a lot of fun. However, Tod and [Jim] had worked on the wording together in advance of the release and they reflect the facts." The rationale behind those comments relates with shareholder expectations.

On the other hand, he confirms that "Borland has strategically committed to investors that the ALM sector of the [company] will drive the business and support their expectations for growth".

"Selling" CodeGear

The most important concept of the email, at least in my opinion is the second point, regarding the future of CodeGear. Consistently with what was told in the past, Jim confirms that "selling the company is still the plan of record and consistent with the strategic needs of both organizations. Despite consistently generating profit and positive cash flow, I didn't feel like [CodeGear] was prepared to thrive as a stand alone entity when I joined at the beginning of the second quarter."

There is no specific time frame for the ownership change, but "this is the path we are on". I think this is very good news... Again, what is the price?





 

9 Comments

CodeGear CEO Clarifications 

It seems like the ownership change is coming:
http://blogs.codegear.com/ao/archive/2007/08/16/38222.aspx
Comment by Serg [] on August 20, 11:57

CodeGear CEO Clarifications 

A sale can't last years... and shouldn't be announced 
this way. "Hey guys, we have a company to sell, do 
you know anybody wanting it?". I am afraid it will 
just spread more doubts about Codegear future, 
despite the health shown. A development tool is a 
long time commitment, they are just scaring new 
adopters and current ones.
Comment by Luigi D. Sandon on August 20, 17:06

CodeGear CEO Clarifications 

We have been working with CodeGear Products, we expend
a lot of money developing over Delphi/C++ but we moved
after the last versions where CodeGear was not able to
address the issues of the product. 

The worst thing that should happen to the users should
be that CodeGear become owned by others. If for
example IBM will purchase CodeGear, for sure will kill
Delphi an d C++ from the supported systems. 

Why? Because they're not 'Hot' and there are other
products that have over 70% if the market. 

Codegear is making a big mistake instead of solving
the issues in the current product, where they get the
money, they are expending the time launching 'Hot'
products to attract investment.

Ok should be a good strategy for the Company, but not
for the customers, that are waiting to have a usable
product for a long time.



Comment by on August 20, 20:18

CodeGear CEO Clarifications 

 Regardless of what is good for Borland, selling 
CodeGear to another entity clearly goes beyond just 
good for CodeGear, but rather essential for its 
survival.

As for CodeGear thriving as a standalone entity - it 
certainly stands a better chance alone than with 
Borland.  No one who looks at the track record can 
argue that fact.

Unless Borland suddenly finds some magic way to turn 
itself around, it is going to go down the tubes, it 
would be a shame to watch them take down a perfectly 
profitable and sustainable business when it happens.

Here is hoping for sooner than later, but they'll 
have to be more honest about what CodeGear is really 
worth based on its sales record to date.  YOu can't 
sell a company for what it could be worth once you 
stop screwing it up at ever turn.  I'm not sure 
Borland is really ready to face a fair sale price.
Comment by Xepol on August 21, 00:20

CodeGear CEO Clarifications 

"Again, what is the price?"

Another outstanding post Marco. I was hopeful that 
when Borland decided to shed CodeGear that these 
great dev tools might survive. But when I hear 
Borland executives pandering to investors with such 
shortsighted irrational and harmful talk it makes me 
realize that CodeGear is just in a different death 
grip than the one it was in before. They leach the 
blood out of the dev tools and then complain enough 
blood wasn't forthcoming. What gall.
Comment by Stephen on August 21, 02:34

CodeGear CEO Clarifications 

Long time ago, Borland decided to rename itsefl as
Inprise. What's their name now? 
Then decided to take Interbase to the Open Source
Movement. Now is not.
So far, they decided to bet on Linux with Kylix... and
we all know (or not) what happened.
Then Winforms.... (well some decision where meant to
be regreted :)

I hope that CodeGear is not one of that expensive
experiments... 
Comment by Salvador Gomez Retamoza [http://salvador.oversistemas.com] on August 21, 20:57

CodeGear CEO Clarifications 

Ok, I am missing something here. They want to sell 
the part of the business that makes money and keep 
the bit that doesn't (and to me has little prospect 
of significantly doing so) ! Someone is in denial 
and I hope it isn't us. How about this for out of 
the box ideas 1) They sell the ALM division and keep 
Codegear or 2) We (as in developpers and Codegear 
management) buy Codegear ourselves. I am not sure 
how many of us there are but a few thousand x $10,000
each plus the rest from the bank should do it ?
Comment by John on August 21, 23:44

CodeGear CEO Clarifications 

Can't be easy for Tod and Jim. They have lot of damage
to repair with limited resources and this is a
difficult and unpredictable business at the best of times.

I sure wouldn't want to be making their decisions.

I thought Kylix would be a winner which would
revolutionize the Linux desktop world, putting Borland
at the center of a new movement. Wrong. Borland stuck
to it, investing in up to 3 versions, they didn't just
give up. But still wrong. Then I doubted Delphi for
.NET would sell, because, well, C# is basically Delphi
in C syntax. Who would want a Delphi.NET? Yet
obviously people do. 

And then there's us; folks with varying levels of
dependency on these tools and therefore a little
scared, perhaps, basically all well-meaning tho' vocal
with our own ideas how things should be run.

I have just installed D2007 and am sufficiently
satisfied to now move my code base across from D5 (not
a trivial thing), so I hope CodeGear remains fit and
healthy (whoever owns it) and I will be first in line
for a Win32 version with Generics. 

All speed to the developer team and Solomon's wisdom
to management, I say.
Comment by Dephi user on August 22, 14:45

CodeGear CEO Clarifications 

Thank you very much Marco. You brought to all of us a
lot through your excellent books, blogs and conferences.

In my company we are the typical case.

We bought D3, D5, D6 and D7. D8, 2005, 2006 were such
a complete disaster for professional developers that
we have started to move new code to C# over the last 2
years. We believe that Win32 code is light faster than
.Net code but we do not feel upgrading to a newer
Delphi is worth it. We even haven't tried D2007 and we
won't. It is just too late. No support for Unicode, no
support for 64 bits, no support for .Net 2.0, poor
documentation, etc.

For us the decision was taken when we realized no a
lot of developer would join us if we were still a
Delphi shop. We had to move to C# to attract
developers. And that will be very hard for CodeGear to
turn around.
Comment by Michael on September 3, 17:31


Post Your Comment

Click here for posting your feedback to this blog.

There are currently 0 pending (unapproved) messages.