I believe technology can be exploited to greater levels than we have allowed. We are constrained by 20th century business models and ideas. Collectively, we need to move past technology for the sake of technology and truly focus on moving markets beyond the status quo!

Friday, October 13, 2006

Leaving (the Software World in) Las Vegas
The final (assuming the HP acquisition of Mercury closes) Mercury World was held in Las Vegas, Nevada the week of October 9, 2006. Captain Mercury had one last hurrah - I am sure many of you remember Captain Mercury, the superhero of load testing!

Mercury World has evolved to an industry bellwether event. Attendees can be assured they will be educated as well as entertained. And, true to their DNA as a software company of vision, Mercury ended their run as an independent company in grand style. The venue was splendid…the Bellagio. The keynote speakers were inspiring…Dr. Jared Diamond (author Guns, Germs, and Steel and Collapse), slam poet Rives and the supernova in a shining event, former US Secretary of State, Dr. Madeleine Albright.

Back to the business of Mercury World…the conference was kicked off by Mercury CEO Tony Zingale and CMO Christopher Lochhead. These two executives were full of zeal and certainly engaged the crowd. In an interesting use of vocabulary, Mr. Zingale continually referred to the impending acquisition of Mercury by HP as the “merger”. Nice positioning to the core group of Mercury customers who made the trek to the Nevada desert to get one last glimpse of Mercury, untouched by the hands of giants.

HP CEO, Mark Hurd, also spoke to the crowd. He certainly showed that HP is not about flash and showmanship as he delivered his matter of fact dollars and cents address about why the Mercury acquisition made sense for HP. In an apparently genuine moment, Mr. Hurd spoke not only to the Mercury customers he hopes to retain but also to the Mercury employees he hopes to retain. He was sincere in extending HP hospitality to both.

CEO Hurd made a point of declaring that “…there is a commitment from the HP software business to delight you in every way”. Yes, he used the word “delight”. Students of architecture always speak of “delight”. However, in the technology world “delight the customer” was always associated with AT&T…and look at the fate of AT&T! You can draw your own conclusion.

Mercury made some solid announcements around SOA testing and announced two new products: Mercury Service Test and Mercury Service Test Management. These products are yet two more pieces to the overall application lifecycle ecosystem that Mercury has been diligent in creating.

Mercury’s partner pavilion showcased some 60 partners and their wares. As I ventured through the pavilion, I realized that over the years Mercury has created incredible synergy with its partners - from boutique professional services organizations such as RTTS and SQS to large offshore providers such as Wipro, Infosys, and TCS to hot software companies such as VMWare and Hyperformix showcasing the future of software quality and management. This pavilion full of technology and services was teeming with people seeking information.

Mercury made a splash in the desert this week, but what happens next? Now, we wait for the HP acquisition of Mercury to close. We must wait and see if HP truly understands what they bought. Hint: it is a software company with 55% market share and 65% of company revenues from products and services focused on the quality and testing of applications. Yes applications, the competitive differentiator in business today, the profit side of IT.

The Mercury testing business has not been a central theme of communication by HP as to why they are purchasing Mercury. This lack of apparent enthusiasm for and understanding of the testing business and HP’s track record in software has spawned opportunity for other vendors in the software quality business. Empirix and IBM are offering existing Mercury customers incentives to switch to their respective products. This seemingly tactical yet highly strategic move by two competitors should not be ignored by HP.

Empirix is a crafty software company that is quite competent in the area of productization. They are customer-centric, agile, and smart.

Conversely, IBM is a stalwart in the industry known for its professionalism. This announcement by IBM signals a “game on” call to the industry.

When we next hear about Mercury, it will presumably be the news around the closing of the acquisition. Empirix and IBM have called “next” and are ready to take on Mercury. Will HP become a player in the world of software where applications are crucial? Will Mercury with the moniker of HP remain the proverbial 800 lb. gorilla in the software quality market? Will the Mercury spirit live on or will HP’s renowned processes get in the way of innovation and agility?

Stay tuned, the next 12 months are going to be better than a game 7 of a Red Sox vs. Yankees series in the bottom of the ninth, 2 outs, bases loaded, the winning run on third, and a full count scenario!

Sorry for the very American reference to baseball… to put it in more global terms…the next 12 months are going to be full of competition, agony, winning, losing, nervousness, fear, opportunity, and excitement. And, that is just the beginning!

What’s next?...flexibility…

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