Rumor had it that, back in 1899, U.S. Commissioner of Patents Charles H. Duell
declared that everything that could be invented had been invented. In actuality,
Duells supposed comment and his recommendation that the Patent Office be
closed down proved an urban myth. Of course, that didnt prevent the metaphor
from being abused by pundits such as yours truly, or by presidential speechwriters.
This week, debate over that urban legend - as applied to the software
industry - will be the central theme of Software 2007, an annual gathering
of the folks who buy, sell, and run software companies. Specifically, its
the question of whether consolidation is killing innovation.
Clearly, unless youve been living under a rock, its kind of hard
to not notice that software industry consolidation has sharply accelerated since
2000. And according to conventional wisdom, when you have fewer voices there
should be fewer new ideas.
But lets first ask if anybody cares. Is there such a thing as too much
innovation?
Ask any SAP customer about how much they look forward to upgrades. Of course,
in most cases, version upgrades are not necessarily innovation. They simply
augment (or detract) from existing functionality.
And then theres innovation that in actuality is little more than feature
creep. Case in point: Microsoft Word 2003. An upgrade from Word 2000 -
which we fondly remember because, for us, it worked just fine, thank you. Yet
the 2003 upgrade added smarter formatting that was supposed to be
innovative. But in actuality, it ended up making our life more complicated and
less productive. Obviously theres such a thing as half-baked innovation.
Too much innovation - good or bad - can be clearly disruptive.
But obviously, were the march of technology to cease tomorrow, youd never
be able to solve that perplexing integration problem, or discover how to rationalize
IT service management.
So lets return to the main point: if innovation is a good thing, does
consolidation stifle it?
Obviously, acquisition strategies where vendors are swallowed up for maintenance
streams certainly validate conventional wisdom, witness CAs practices
during the Charles Wang era.
But when a vendor acquires a microscopic startup, its usually about mainstreaming,
not killing innovation. For instance, when BEA bought 12-person SolarMetric
about a year and a half ago, it was a shortcut to adding a critical piece of
Enterprise Java Beans 3.0 object/relational mapping technology to its products.
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