What a Year It’s Been

It seemsevery year has its high and low points, but it’s fair to say that this year wasgraced with more than its fair share of excitement. Let’s recap some of theyear’s highlights.

Windows 2000 debuts. Nearly four years after the release ofWindows NT 4.0, its successor product was finally launched Feb. 17 amid apresentation that featured a humorous exchange between Bill Gates and actorPatrick Stewart, several thousand client machines hidden behind curtains,Carlos Santana and his band, and one gigantic laptop computer. The launch wasfollowed by an announcement that the first million licenses had been sold in 30days, but the adoption of Windows 2000 settled into a curve that proveddisappointing to Wall Street analysts. Stock values plunged to as low as theupper $40s from a high early in the year of more than $110 per share. Despitethis perception, Windows 2000 uptake is progressing nicely. By the end of thisyear, sales should be at a run rate where Windows 2000 accounts for one half tothree quarters of the combined monthly Windows NT and Windows 2000 shipments.

Breaking up is hard to do. In late April, US Judge Thomas PenfieldJackson ordered a harsh set of remedies imposed on a still-defiant Microsoft --including a mandatory break up. The company continued to press forward on itsstrong convictions, and won a small victory when the US Supreme Court declinedto hear the case prior to an appellate court review. In the mean time, thecompany reorganized itself and unveiled complex new product strategies thatcontinue to blur the lines between operating systems and applications. Fewanalysts expect to see the day come when Microsoft actually has to splinter.

Novell and SCO stumble. Two Microsoft competitors nearlycollapsed this year. SCO’s sales during the first half of calendar year 2000hovered at 50 percent of 1999 levels, and Novell’s NetWare sales declined 30percent during the first six months of 2000 compared with 1999 levels. Bothcompanies have formulated a survival strategy. Novell now focuses on NetServices, selling -- exclusive of NetWare -- its directory services products,management tools, authentication, caching, and firewall products. This allowsthe company to coexist with Microsoft in the server operating system market.SCO decided to just say no when it sold its Unix business to Linux startupCaldera Systems. Caldera unveils a strategy to unify SCO’s former OpenServerand UnixWare products with Caldera Linux at the application level.

Embedded efforts. Microsoft finally collected its embeddedactivity into a division charged with addressing this diverse and fast-growingmarket. The company gathered together Windows NT Embedded 4.0 and the Windows2000 Server Appliance Kit technologies, along with Windows CE, then rolled outa much-improved Windows CE 3.0. This happened not a minute too soon. Manyembedded developers are enthusiastic over Linux as an embedded operatingsystem. If Windows technologies are to compete in the embedded market, theyneed to do it right now.

.What? Defending its belief that there is no post-PC era forcingthe fat PC into extinction, Microsoft unveiled its .NET initiative, promisinginteroperability between clients and servers, between servers and servers, andbetween servers and mobile devices. The company spent months trying to help theindustry figure out what .NET really means. Simply stated, .NET wraps updistributed system services by using XML for data exchange, SOAP for initiatingremote services, and UDDI for allowing servers to publish their inventory ofservices to other connected systems. All of this is expected to help promoteinteroperability, but if you want the richest user experience, Microsoft saysit will still be found on the Windows platforms.

Datacenter Server’s good start. Microsoft has finally fielded a productthat should help it establish credibility for itself at sites looking to rollout midrange-level servers. While Datacenter Servers name suggests thatMicrosoft is looking to compete in the mainframe or high-end Unix space, thecompany and its OEM partners have yet to prove this technology is suitable forhigh-end users, and for now they can only pitch an IA-32 story. Microsoft ishurt by an impending upgrade to get to a full 64-bit environment, a transitionUnix systems won’t force on users.

Implosion of the dot-coms. This column wouldn’t be complete with anoffering on the implosion of dot-com stocks. A year ago, investment firms weremaking comparisons between the Internet stock run-up and the Dutch tulip maniaof the 17th century, and it looks like the analogy proved to beaccurate. But we have to give credit to the dot-com craze for changing theindustry’s thinking about what constitutes a connected business and whatoutside-the-box thinking can produce in a widely connected world. Now it’s upto the IT professionals at traditional businesses to pick up the ball where thedot-coms left off and steadily build an electronic economy. --Al Gillen is research manager for systemsoftware at IDC (www.idc.com)and former editor in chief of ENT.Contact him at agillen@idc.com.