Slashdot Mirror
VA Linux Systems Leaving The Hardware Business
The subject pretty much says it. You can read the announcement
over at Yahoo, but the short and long of it is that VA, the company that owns OSDN which owns Slashdot, Freshmeat, and assorted other Linux web sites, has announced that it is leaving the Hardware Business to focus on SourceForge OnSite, OSDN, and Linux development and consulting. Slashdot should be unaffected.Update: 06/27 08:43 PM by H :It's also relevant to point out this statement from Richard French, the General Manager of OSDN, which is a message to the Community.
You know your business is in bad shape when you have to switch to being a pure dot-com in order to improve matters.
The large vendors will always be lowest-cost providers of commodity hardware. If you don't have the lowest cost, you have to add value. If Linux now runs on most commodity hardware, and the large vendors will ship with Linux installed, where can VA add value?
Rule #1: You cannot outrun the entire PC industry. You can be smart, and you can be cheap, but you can't be consistently smarter and cheaper than all the guys in Taiwan. If you have a specialized niche, you have to keep inovating in that niche and hope it doesn't become part of the PC mainstream. This is what ate SGI. It almost killed Apple. It might eventually bring down Sun.
Just because they're capable doesn't mean they don't have better things to do.
Seems to me like this is a solid service that VA could make some money on. How much remains to be seen.
---
I used to work for a very legitimate consulting company that sold products for the AS/400.
Sometimes people would need to get a new key for their software. That action took the administrative assistant a minute or two to do. Price to the customer? $100
Businesses realize that people need things, even silly things, that they are in the best position to provide. If they can make a significant amount of revenue that way, why not? It can make their "main services" a bit less expensive.
---
I think I almost have to agree, even though I still own shares (the same @#$%# ones I got in the IPO and was too stupid to sell).
I think SourceForge On-Site could be profitable, but only as a small business. VA should immediately get out of the Sillicon Valley area and take other measures to keep costs down. The revenue from it should be able to pay for a few people.
The *best* thing they could do is get out of being a publicly traded company. I wonder if that's even possible (maybe only by declaring bankruptcy?). They few things it has left to sell do NOT justify having a stock on NASDAQ. If they could get out of that, and lay off the people that do everything the SEC requires, and return to being a SMALL business, I think they could make a decent living for themselves.
---
--
"Remember when the U.S. had a drug problem, and then we declared a War On Drugs, and now you can't buy drugs anymore?"
How can OSDN earn money ?
Web banners ? Ad banners on Slashdot and Freshmeat are all for other OSDN services (valinux, sourceforge, thinkgeek or free software) .
Well to be fair, Thinkgeek does make money off things other than ad banners.
TIME TO SELL LOTS AND LOTS OF PENGUIN MINTS !!
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
-E
Send mail here if you want to reach me.
Frankly, this announcement was inevitable. There is a limited market for custom servers, and VA Linux was never interested in building enough volume to be the Dell of Linux (i.e., provide lots of cost-effective hardware for low prices), they wanted to be the Sun of Linux (i.e, sell high end server products for high prices). The problem is that Linux does not lend itself to a Sun approach. People who want to buy Sun buy Sun, not VA Linux Systems. People paid the premium for VA Linux servers when the dot.com money was flowing, but now that it's not, they buy Dell. Or, if it's a higher end server, IBM. VA Linux just did not have the volume to sell at a competitive price, and this move is a recognition of that fact. Unless you are buying parts in lots of 10,000 nowdays, you just can't make money in the hardware business -- and even at those volumes, Dell, HP, and IBM are all having to tighten their belt buckles to make any money selling PC's.
The wonder is that it has taken this long. I predicted this would happen back in March of 1999 (the ill-will from that prediction, which was sent to several high-level VA executives expressing concern over their business model and where I thought it would lead in the future, is one reason why I did not go to work for VA after they bought "selected assets" of Linux Hardware Solutions). I guess it took that long to burn through all the VC capital plus the IPO capital.
The interesting thing is that this basically leaves Sam Ockman's Penguin Computing as the "last man standing" of the Linux hardware business as of September 1998. I remember meeting Sam at the Atlanta Linux Showcase in September 1998, the last show before the Linux Movement died and the Linux Business was born. At that time he had started his business only a few months earlier, barely had enough money to meet payroll, and was wandering around poking his nose into our boxes and into VA's boxes to see what parts we were using so that he could think about what he could do to compete against us. He'd already been evicted from one apartment for running an assembly line in the back bedroom (or was it the living room?). He had nifty ads in all of the Linux magazines, but was out of cash for any further ads. I remember Kit Cosper of Linux Hardware Solutions saying that Penguin Computing was not long for this world. Sam certainly has the last laugh here!
-E
Send mail here if you want to reach me.
In short, VA's hardware and excellent service will be missed. If nothing else, the UPS-powered blinding blue LEDs helped illuiminate the machine room when the blackouts happened. Dammit, now I have to find another vendor...oh wait, no I don't; we don't have any money either...
...how long will it take to work it down with (measly) banner ad revenue?
How many people will be let go?
Is Raster and/or Mandrake still working for VA, by the way?
Tremendous condolances, in any case. It's hard watch a dream die.
Sounds like the kind of brain surgery you have when you're going to die
anyway but don't want to throw away your insurance.
"Cash burn" eh. Are these new economic theories patented or open source?
There's no doubt that VA Linux will be going out of business within the year. The
software business never made money to begin with and now they're just
shooting for a gentle slide into the ocean instead of an abrupt crash.
Must say that enough Linux sites exist to virtually obliviate the need for anything but sourceforget on their OSDN hodgepodge. Unfortunately, when sourceforget goes, it'll be the 10th hosting provider I've had to relocate off of since the internet began.
So does anyone know where I can get a case similar to the ones that VA sold? Specifically, with the blue leds - thats really the only reason I want one. I dont want to get all fancy with it, but that one blue light shining into a dark room always made me smile.
-----
If Bill Gates had a nickel for every time Windows crashed...
Slashdot should be unaffected.
;)
Riiiiiight. Now is this what you think, or what they're telling you? Cause I had the CEO of the company stand in front of the entire Corporate office and say that we had enough money to last us till at least June (this was in March). Then this happened. In March. March is a bit before June.
The PHBs always tell you that the company will be fine. Could you imagine if they said otherwise?
-----
If Bill Gates had a nickel for every time Windows crashed...
Interesting you should mention this, even as a joke. At one point, AA really were making more profit off SABRE than they were off flying planes around.
the TiVO -> VA commute (8 miles approx.) used to take 45 minutes to an hour during rush hour.
Yeah, it takes me a while to get off my butt from in front of the TV when there's good stuff recorded on the TiVo as well.
:-)
--
The next Cmdr Taco duplicate will be ready soon, but subscribers can beat the rush and see it early!
When I graduate from college (assuming I get hired somewhere) I wanted to give back to VA Linux for all they've given to me by purchasing a VA Linux workstation. This seemed like one of the best ways I could say thanks, but now that they're leaving the hardware business, what can I do?
Does anyone else spot the teensy little flaw in the logic?
It's a small world and it smells funny; I'd buy another if it wasn't for the money; Take back what I paid (SoM)
Never buy stock based on your religious believes.
-adnans
"In short: just say NO TO DRUGS, and maybe you won't end up like the Hurd people." --Linus Torvalds
When VA (and Penguin, and a few other companies) got into the hardware business, there was a small market niche for boxes that were optimized for Linux, and preconfigured/tested appropriately. Once the bigger vendors (with drastically lower costs) stepped into the marketplace and Linux itself became a product that could be sold and installed straight from the box, the niche companies were doomed. When Linux servers become a commodity, then only the vendors with economies of scale will thrive. VA can't play that game.
If there's any market to be had, it's in selling software and services (though probably not enough to justify the insane valuations that were taking place last year). In essence, Andover was onto the right idea for long-term sustained profitability, but VA wasn't. However, since Andover had much shallower pockets at the time, VA bought Andover instead of the other way around. Stock was cheap then. In the long term, VA was fated to be Just Another Box Company, and there's no money in that anymore (maybe a small shop can make money selling custom boxes, but big companies won't buy from a tiny boutique shop - just from the Dells, Compaqs, IBMs, and HPs of the world, cutting off the air supply of a small public company like VA).
As a software/services/portal company they should have a lower cost basis (building, selling, and supporting boxes is expensive) and, more importantly, lower their cash burn a whole lot. After all, there are portals that make money, software vendors that make money (including Open Source software vendors), and services companies that make money. And there is some synergy between all of them (except for maybe ThinkGeek, but ThinkGeek probably doesn't cost a lot to operate and earns them enough street cred to be worth it). So even though VA's insane valuation was based on their being a hardware company, dumping hardware was probably the right move at the right time. Of course, in another year or so we should know for sure.
- -Josh Turiel
-- Josh Turiel
"2. Do not eat iPod Shuffle."
I agree. When the largest hardware vendor in the united states enters your market (in this case, Dell selling Linux pre-installed and semi-supported (support through linuxcare or redhat)) the effect is the same as when the largest software maker (M$) in the world enters your market for software you were selling.
--
You know, you gotta get up real early if you want to get outta bed... (Groucho Marx)
"But remember, most lynch mobs aren't this nice." (H.Simpson)
-- Joe
What box of theirs was unique? I just bought a 1221, one of VA's latest. It has 2 CPUs, a ServerWorks chipset, two hot-swap SCSI bays, and two full-length 64/66 PCI slots in a 1U chassis. Just from a quick Google, I found three other vendors selling very nearly the same gear. The only thing I was unable to determine was whether the other vendors have a front-panel serial port. That isn't a feature that would sway my decision.
What's sick is that a machine I just bought for $6500 is going for $2200 at VA's fire sale.
Their sales staff were dumb as stumps. Troy T., I'm talking to you.
No. They're going to lay off 150(ish) of their *least* profitable employees.
Note that revenue != profit. While they received the bulk of their revenue from hardware, that was also a disproportionately large share of their loss.
Ergo, they expect, ultimately, to make more money as a software company. Worked for NeXT.
_Deirdre
Actually, ALL trading is suspended (for a few minutes) when there's company news. That's why companies typically wait until after close-of-market for news -- so as not to interrupt trading.
_Deirdre
Don't worry dear, that was before you were born. Clearly. NeXT made some of the best hardware and software for its time, ceased making hardware, then sold itself to Apple for $300M.
MacOS X is mostly NeXT stuff with a fresh coat of paint and a lot of stuff for compatibility.
_Deirdre
Today, between the time when I know that there will be an impact but I don't know how many of my friends will be jobless, I hope that any who need to find a new job will be able to. The valley is pretty scary right now.
For example, the TiVO -> VA commute (8 miles approx.) used to take 45 minutes to an hour during rush hour. Yesterday, it took 23 minutes from two miles further.
If there are layoffs, some of the VA guys came from other places (like Linuxcare) and may have the pain (as I did) of having been downsized in more than one Linux company.
Hang in there guys.
_Deirdre
I never understood the rationale behind VA Linux. I can get better prices at the local screwdriver shop. If I want support and better engineered hardware, I can buy a server from IBM. In fact, that is what I did when I bought a low-end server last year.
Mea navis aericumbens anguillis abundat
VA Linux IPO soars almost 700%
Before Andover bought Slashdot and Freshmeat, they were really a piddling little company. I think their premier site was the broken link-haven of "Dave's Shareware". They did have Roblimo working there, I think, and obviously some netop and banner network experience.
The key bit is that Andover had some access to capital, bought up some Linux community sites, and IIRC *almost immedately* sold out to VA.
VA dumped tons of additional capital into the web business. The rest of OSDN, including linux.com, NewsForge, and SourceForge were all created solely by VA, and Andover was really just the middleman for slashdot and freshmeat. Tough to give them too much credit for VA's business move towards Linux web community sites.
--
Business. Numbers. Money. People. Computer World.
And why should VA have a geek-cool buzz about them in some place like slash? I went up to a VA Linux booth at linuxworld once. First question "Do you have any alpha boxes?"; Second question "Uh, any AMDs?". Hm, just Intel processors, huh? See you...
And if they can't make money in the web biz, oh well, those are the breaks. The open source movement doesn't *really* need corporate success to survive.
Remember: free software will get you through times of no money better than money will get you through times of no free software.
You need fancy server hardware on the stuff that
can't fail, e.g. if you've got your database
running on one box (and the odds that that one
box is going to be Intel based is pretty low).
Using (relatively) cheap boxes as front-end webservers is an entirely reasonable thing to
do. If one dies, oh well, you lose a few hits,
but the next box in line takes over.
---
This sig has been temporarily disconnected or is no longer in service
June 23, 2001.
--
--
"Outlook not so good." That magic 8-ball knows everything! I'll ask about Exchange Server next.
Wait... I thought VA bought Andover.net...
Looks like the other way around
Wow, those guys at Andover are a sneaky bunch
Arrogance is Confidence which lacks integrity. -- me
That slashdot will soon stop advocating the usage of banner redux software like junkbusters :) Imagine having to rely on banner ads and sponsorships for make payroll!
I can't understand their decision. They just can't *loose* money. VA Linux hardware is expensive compared to the same hardware built by your own. And it's selling. And well, according to what I saw in racks.
You won't see an VA boxes in our shop. Why pay twice the price of a local company that gives better turnaround and service? There's not a compelling reason. Things are tight for everyone out there, and if you can save some bucks by not buying overpriced (but prettily cased) equipment, that's a bonus. I think I'd have to punch anyone who bought a VA linux box in the face, right about now, because it just doesn't make sense.
Obviously they're not selling enough hardware right now to cover their overhead. The future doesn't look too good either... Staff, Advertising, space, all these cost money. Unless you're selling A LOT of hardware, or have a very low overhead, you can't make money, and VA met none of these.
Yeah, I hear you. I was going to put one of my projects on SourceForge. Their info sheet and FAQ made it sound like the next best thing since cheese-whiz. Then I started looking at all the projects hosted on SourceForge, and got really cold feet...
A Government Is a Body of People, Usually Notably Ungoverned
YEs, but didn't you read? Revenue is != Profit.
The burn rate for hardware is higher than that for their other operations... they will LOSE less money by NOT doing hardware business.
I can have a rock solid revenue stream, as the previous poster said, by selling dollars for 99c, but I'll *never* be profitable.
It leaves VA in the same place they always were. They must provide warrantee and support as specified in the contract of sale.
VA is not dissolving; they are just ceasing to sell hardware.
Delta Hotels International announced today it will be leaving the hotel business and instead concentrating on it's online 'global hotel reservation' website, as well as it's accommodation forums.
American Airlines has announced it will cease operation of it's fleet, and, instead, spend it's time and money working on an online set of websites where peopel can discuss issues related to travel.
Microsoft has announced it will be leaving the software business (yay) and solely making it's living off MSN(tm)Messenger(tm)
Sheesh. Bye VA.
I like the add that sais "Want a VA Linux Server"...
Kind of appropriate to have that banner ad displayed on a day like today...
Just because they brought in the most revenue doesn't mean they were the most profitable. In fact, they never made a profit at all, which means that cutting the division will cut expenditures even more than it cuts revenue, therefor benefiting the bottom line.
-- It only takes 20 minutes for a liberal to become a conservative thanks to our new outpatient surgical procedure!
March 16,2001. -Ben
I don't know about the servers, but their workstations were really overpriced. Same goes for Penguin Computing.
Wow, it was definitely the other way around for the servers - they were incredibly reasonable. We just decided to pick up about 40 1u servers from them, and then today's announcement hits. So much for that plan. Nobody could even come close to touching their 1u prices, and the hardware was phenomenal. Single-CPU 1u units could be had for about $1,000, and you sure can't find that at Dell (except with the crappy Celeron units).
What's your damage, Heather?
--------------------------
"Any fool can make a rule, and any fool will mind it."
"Any fool can make a rule, and any fool will mind it."
--Henry David Thoreau
Anyone remember when, during the big IPO craze, that lots of people were saying that VA was the Linux company most likely to succeed in the marketplace? The rationale was that VA actually sold real, physical products. Unlike, for instance, Redhat, who was spending a bunch of money on software development and then giving it away for free in the hopes that people would sign up for support.
Now, VA's hardware business is gone, and Redhat is on its way to becoming a profitable company. What happened?
I guess that, strangely enough, VA has become a victim of the success of Linux. As industry giants like IBM and Dell have jumped into the Linux business, VA has seen its market share erode, apparently to the point where it is no longer reasonable for them to continue.
It's a good thing they didn't have all their eggs in one basket. All of their purchases and investments after the IPO seemed a bit extravagant to me, but now they may be the only thing to keep the company alive. Sourceforge is a great product, and hopefully it is enough to alow VA to eke out a modest existence.
One thing is certain: that 300 dollar share price on LNUX stock a while back sure seems pretty silly now. I suppose it seemed silly even then.
--------------------------
"Any fool can make a rule, and any fool will mind it."
"Any fool can make a rule, and any fool will mind it."
--Henry David Thoreau
Heh. Yeah, they just popped this one while I was reading this story:
9 93677539710
http://images.slashdot.org/banner/vali0034en.gif?
I purchased several VA systems when I was at Videon here in Winnipeg. The systems have proven to be stable and reliable.
I'm sorry to see this hardware resource go, and wish them the best of luck in the software world.
That when I refreshed Slashdot and got this story the banner ad was for VA.
Do really dense people warp space more than others?
With Solaris licenses. I'm not sure you get a media kit though -- it'll probably cost you another $us60 or so, if you need the actual CD's. Sun traditionally includes an unlimited-user license for Solaris with every box they sell. The price is $us995.
Geeky modern art T-shirts
How can OSDN earn money ? Web banners ? Ad banners on Slashdot and Freshmeat are all for other OSDN services (valinux, sourceforge, thinkgeek or free software) .
And OSDN needs a lot of bandwidth. I guess all that bandwidth isn't provided for free.
On the other hand, when I walk through alleys of server farms, I always see a lot of VA Linux racks. They are easy to distinguish with their blue leds. So I thought that VA Linux was selling a lot of hardware. And selling hardware bring money. SGI is also selling VA Linux hardware (they just add their sticker) .
I can't understand their decision. They just can't *loose* money. VA Linux hardware is expensive compared to the same hardware built by your own. And it's selling. And well, according to what I saw in racks.
Compaq drops Alpha processors, Mandrake runs out of money, Netscape focuses on a stupid web portal, VA Linux stops hardware... That's bad. Really bad times for the world of Unix and free software.
-- Pure FTP server - Upgrade your FTP server to something simple and secure.
{{.sig}}
Does anyone else find it funny to see the very first /. article talking about how VA is going to give up their HW biz, and then right above that is a banner ad extoling the virtues of a VA 1RU or 2RU server?
Ooh... now it says, "Need a VA Linux server? GREAT DEALS on VA Linux servers - CHECK 'EM OUT!". Well, yeah, I'd think if you're getting outta the biz, that you should be offering tremendous deals!
--
Key to financial independence: Spend less than you earn. Save and invest the difference. Do it for a long time.
Interestingly, I suspect that one reason they pulled out of the direct server market is that they can't really compete with IBM. Originally, VA filled a market demand for servers designed, tested, and supported to run Linux. Even (perhaps especially) for a startup getting computers that will be supported with the software you need or want to run is important.
Now, IBM, and to a lesser extent Dell and HP, are getting into that market, and companies migrating to Linux, or a dual environment that have large investments in servers made by one or the other are much more likely to stay with that vendor for all their hardware needs across NT and Linux platforms.
Not any more. IBM, Dell, and HP are all starting to sell servers with Linux preinstalled and supported. That was VAs ace. It used to be that if you were a startup with limited resources and you wanted to use Linux for whatever reason (cost, flexibility, etc), but either didn't have the expertise, or didn't want to waste you expertise on system administration VA was a good choice to sell you a well designed server that had been tested under linux and supported with Linux on it. Now you can just go to Dell.
Better get your aluminium hat on, conspiracy boy.
--
--
Internet Explorer (n): Another bug -- that is, a feature that can't be turned off -- in Windows.
- The Santa Cruz County Computer Industry Index
-
Market Yourself - Tips for High-Tech Consultants
Best of luck to everyone. I have a lot of respect for a company that would use a program like Cerberus to stress-test its systems.where else can you buy hardware that you can count on not being crappy?
Mike
-- Could you use my software consulting serv
No, it was a Linux guy at one of the Colorado Linux Info Quests, but I forget who. One of the keynote speakers IIRC.
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
A while back someone (I forget who now) said "VA Linux is trying to be the Dell of the Linux world. Unfortunately there will only be one Dell of the Linux world and that will be Dell." Wish I could remember who it was who said that. Damn...
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
Well, Sun sells a UltraSPARCIII 1U server for $999...
-carl
. We've got computers, we're tapping phone lines, you know that ain't allowed - Talking Heads, "Life During Wartime"
From the article:
So, they're pulling out of the area that was making the profits, to concentrate on the loss leaders? Someone explain this, it looks totally insane to me.
"That old saw about the early bird just goes to show that the worm should have stayed in bed."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-
Friends don't let friends enable ecmascript.
...it was supposed to be the next Dell.
Flame out.
It always seemed odd to me that adding a free OS to a box seemed to make it cost more than a Windows box.
I'm still working on a clever footer.
Hardware is a notoriously low-margin business. Only a few big companies can hope to compete on price. Anybody else who wants people to buy their iron had better add some serious value. "We'll install Linux for you" doesn't even come close.
That's interesting. Intel made over $10 billion in profit last year (which FYI is more than any other tech company has ever made in one year), and had gross margins over 50% (which is absolutely unprecedented for a company of that size). All of the profit was from selling pure hardware, and they didn't do any "value added" crap either.
There is certainly no other pure service company with either profits or margins anywhere in that ballpark. IBM makes a lot of profits (not as much as Intel), but their margins are considerably lower (they just have a lot of revenues).
However, with the popularity of linux as a server system rising, we are starting to see the big boys such as Compaq and Dell get into the act. I'm guessing that VA has seen that they will not be able to compete with the larger hardware vendors, and are opting to stick with linux consulting/development roles. In one sense it's a shame to see VA driven out of the hardware role by the larger corps, but on the other hand it's a strong indication of linux's success.
--
Unix is user friendly, it's just selective about who its friends are.
Yahoo sez:
Historically, VA Linux has generated a significant majority of its revenues from the sale of its hardware products. VA expects its revenue to significantly decline with the elimination of the hardware segment.
What? They are going to fire 140 of their most profitible employees? Is there some PHB type who can make sense of this for me?
Friends don't help friends install M$ junk.
A move like this takes guts. Plenty of companies would keep pissing away money on the failing business area out of habit, or out of fear of change. It's a good sign that they are willing to face the facts and make cold, calculating decisions. If they succeed in turning themselves into a profitable open source powerhouse, today will be remembered like Microsoft's famous Internet reorientation.
-- ;-)
Kuro5hin.org: where the good times never end.
The big problem with VA Linux is that all the things they're good at are free. Slashdot, SourceForge, etc. are good, but generate no revenue. VA Linux hardware and support don't seem to be notably better than anybody else's, but those were the revenue generators. It just doesn't work as a business.
You forgot, ...That building a brand then tossing it away doesn't make any sense.
If VA doesn't want to build the servers themselves, they should license the design to some other box maker. It would be kind of like what GM did to Chevy and all the other car makers.
For all intensive purposes, "whom" is no longer a word. That begs the question, "who cares"?
you never know
Ignore the "p2p is theft" trolls, they're just uninformed
Selling (low-end) systems is a dog-eat-dog business with razor-thin profit margins, which means that only the largest 2 or 3 players can crank the volumne necessary to make a decent amount of money. Plus, demand for new desktop manchines is down - people and companies are keeping their old machines longer because they don't need to upgrade. A 500MHz machine is already overkill as a desktop for most people. There really isn't any benefit in upgrading from a 500MHz box to (say) a 1.2+ GHz box if all you are running is an office suite, mail, and a browser -- there is no noticeable difference between the two unless you are doing somthing processor-intensive like CAD or rendering.
Why is it that the proponents of "one nation under God" are so eager to get rid of "liberty and justice for all"?
When they had the ads for the "used VA servers", I should've known it would lead to this.
Daniel
First of all, it proves how big business (big scared businesses) can drive the little guy out of his own business.
It also shows that the future of hardware is -not- from commerical organizations, but rather from truly open, not-for-profit vendors. The only way we can continue to grow is to abandon the old idea that somone has to get rich by selling things at an inflated price. VA has proven that a vendor need not make a profit to better the world. Expect the concept of free, open hardware (and not just open software) to grow over the next few years.
How will this affect SGI?
That may sound like an odd question, but if you look at SGI's Linux offerings over the past 12 month, you'll see that they resemble a (poor) attempt at being a VA Linux wannabe.
Also note that some of SGI's Linux servers were OEMed from VA.
It will be interesting to see how this affects SGI over the next 6 months... will SGI's Linux offerings be better or worse as a result?
I don't want to start a flame war, but dismissing the megabucks Intel spends on R&D and plant as "crap" is childish. Or are you offended by my use of the capitalist jargon like "add value"? Hey, we live in a market economy. Deal with it.
__
Hint: If you're saying something clever, use the Subject line to pique people's interest. Like, "What's Intel do that I can't?"
And post more. Please.
__
Hardware is a notoriously low-margin business. Only a few big companies can hope to compete on price. Anybody else who wants people to buy their iron had better add some serious value. "We'll install Linux for you" doesn't even come close.
__
This is probably also a cash-preservation measure. Think about it.... there's a certain inventory ($8 million and rising as of 4/28), and now it can be sold without being replaced. By liquidating their hardware inventory, they generate enough cash to keep the doors open for a few more months.
A quick look at the financials suggests that VA is quickly running out of cash.
My company has purchased boxes from VA since back when they were VA Research. Rock solid boxes. Generally well engineered. Most of them, even the Pentiums, are still in service.
The sales/business side was the death of VA Linux.
I bought what I needed to buy from VA Research before they became VA Linux. They built it to order. It was great.
Have you tried to buy something from VA Linux that didn't precisely match what they thought you should buy? If you succeeded, I'd like to know which of the folks on their staff is your drinking buddy.
I tried to buy some hard disk brackets for my FullOn servers. They had the chutzpah to _require_ me to buy drives if I wanted the brackets. And if I want 9 gig seagates instead of 9 gig quantums? Hoo boy am I talking to the wrong people. Bad enough I have to take that attitude from Microsoft. I won't accept it from a Linux company.
I'll miss the hardware but I won't miss the company. Good riddance.
Moderating "-1, Disagree" is simple censorship. Have the guts to post your opinion.
Solaris is free for machines with less than 8 processors. Has been for some time.
You can even download ISOs there.
Conformity is the jailer of freedom and enemy of growth. -JFK
Hey *asshole*. Putting brand-x computers together is *not* a viable business plan.
PC shipments are *down* 45% this quarter.
VA Linux *never* should have been given *VC* and *IPO* cash.
Conformity is the jailer of freedom and enemy of growth. -JFK
What date will Slashdot disappear?
My guess: February 16, 2002
Conformity is the jailer of freedom and enemy of growth. -JFK
The ideal situation in business is when you can do some particular thing so much better than nobody else comes close. That's just not going to happen for hardware built from standard parts.
But VA, in doing the right thing with Source Forge, in terms of providing an environment to foster software initially to make their hardware look better, may have stumbled into an area where they can build a large business and keep the lead for some years.
The stupid thing about the dot com bubble was the notion that a group of computer jocks would be so much smarter about just everything that they could do retailing better than, say, outfits that are run by families that have decades, sometimes centuries, of retailing culture under their belts. As if ability to work with computers assured you of having 50 bonus intelligence points that could be applied anywhere in life.
Well, it's not that the nerds took over from the corporations. It's just the inverse: every traditional business of any size is becoming in significant part a software development house. And it's mostly a matter of working up from small projects that work for some particular location or department to a broader integration. The way to do this well, when you're not starting out with the computer system and trying to make the business fit it (the nerd model), is to start with the business intelligence in each of those locations and departments, and find a way to bring that all together.
But that's been very hard to coordinate. Which is why way too many large businesses bring in SAP or the big consulting firms to try to do it top down - basically, the nerd's mistake again. For generic enough businesses, where the people really don't need to do more than run a widget assembly line and sell to established markets, this can work. But for a business with more specialized intelligence innate to its operations, this can really f*ck you up.
Source Forge gives an organic way for a major corporation that's found that SAPiness saps their lifeblood, but that also has had prior trouble getting efficient, effective company-wide development worked up into higher-level integration, to pull niche-specific, wisdom-preserving integration off. Which puts VA into a position to get into the really serious money that currently mostly goes to stuffed suits who know nothing but how to walk the MBA walk - and who are hated by anyone in the firms being consulted who actually knows his or her shit, and sees how the "daddy knows best, he went to business school" attitude of the top-down fixers will destroy much of the real wisdom that older, successful corporations have accumulated in their staff.
Business likes to give lip service to the 'new,' but business is profoundly conservative. Source Forge is the conservative way to embrace and develop the newest technology without nullifying the intelligence embedded in your current business culture. It's revenge on the nerds' premise that we were smarter than everyone in every way. But it also allows the nerds, as we go to payroll or contract work for old-line firms, a degree of freedom and collaboration that we wouldn't have if the only model was SAP-like. If we've got to serf the web, at least we can whistle while we work.
(And this may be why Microsoft will essentially go out of business within a decade. Internal development based around open source models will leave no reason to license anything from Mickey G. He'll end up like Corel, with a slice of the home market from people who want to still use the software they used to know.)
"with their freedom lost all virtue lose" - Milton
VA Linux has generated a significant majority of its revenues...
They need to maximize profits, which were not forthcoming from the hardware business, as you can tell from the discussion of "cash burn." OSDN can be made (maybe is already?) profitable, so it's worth keeping.
After all, I can sell dollars for 99 cents and make lots of revenue. Stockholders a couple of years ago were willing to fund such behavior. No more.
sulli
RTFJ.
> respect for a company that would use a program
> like Cerberus to stress-test its systems.
>where else can you buy hardware that you can
>count on not being crappy?
As the author and (still VA-employed) maintainer of Cerberus/VA-CTCS, this comment really made me feel better on a day of reckoning -- most of the SW group was hanging around a little depressed after the announcement and when I and my coworkers saw this post, I felt that maybe a FEW people understood why it was that VA's systems always seemed "overpriced".
We tried to change how PC hardware was manufactured. I developed automated factory quality control systems that enforced QA policies under Cerberus... while they were sometimes overridden for 'business reasons', the restrictions raised the bar for our products and made them more reliable per capita than anything else out there. A while back, I wrote an essay on "Microsoft Quality Hardware" published in the Linux Journal that described how I hoped Linux and Cerberus-like initiatives would save PCs from the scourge of the industry in quality.
And we punched some holes in the status quo. Beating the odds, we discovered problems in products from every big name in PCs (Intel, Adaptec, Tyan, Mylex, etc) before anyone else, and it is certainly no small thanks to VA's dedicated SW and HW engineering groups that modern server hardware works as well as it does under Linux.
I hope other HW vendors pick up the slack. With Linux and Open-Source drivers, it is _possible_ to prove conclusively if a piece of hardware is broken, and we can break the chain of component vendors pointing at Microsoft pointing at integrators, etc. Meaning that the PC industry can achieve the reliability of Sun at the price of Dell.
Some things are changing at VA, but Larry was right when he said in the press release that our software component really has always been our differentiator. I just wish that we would have figured that out sooner, sold that aspect to our customers, and avoided our current predicament.
Don't count VA out yet. There are a lot of smart people still here, and I think if VA can come out of this with morale intact and a concrete vision for the future, things will turn around.
"Wherever you go, there you are."
(On a side note - does this mean that ThinkGeek start selling software too? :-P)
With or without their "real UNIX"?
--Blair
Trading in VA Linux was halted for news. The issue last changed hands at $3.26
Why was trading suspended. Is it such bad news that they think investors may freak out?
Your pizza just the way you ought to have it.
That slashdot and other OSDN sites bear the main responsibility for generating revenue. Slashdot in particular as it's frequented by so many people daily. One way to do it may be to insert some extra data (such as tags) into comments and help boost revenue and creating some subtle albeit effective advertising. Something akin to SmartTags should go a long way towards compensating for the cut revenue from hardware sales. How big a job would it be to implement that in slashcode?
Your pizza just the way you ought to have it.
That Microsoft can buy VA Linux for about 1% of its avertising campaign for XBox?
That throwing away the part that *makes* moeny is no way to run a compnay?
That a negative share price is *not* something desireable?
That money is actually *needed* on the real world? You can't eat GPL. Okay, you can, but it's a sorry state of events, and isn't very nurtitent.
That circular advertising is *not* a way to make money?
--
Two witches watch two watches.
--
Two witches watched two watches.
Which witch watched which watch?
I don't see how the sale of one product(namely SourceForge OnSite) is going to keep VA Linux afloat. This is not to rip on them, but I just don't see it happening. Slashdot probably should start making contigency plans when(notice not if) VA goes under. Hmm... at least I will be able to get a pretty decent tax write off on the few shares that I own.
Actually, the new release of slashcode is being delayed pending the port from Perl on MySQL to VisualBasic.NET on IIS.
One notable change will be that all users will log in to slashdot using their Passport accounts. This will allow everyone to surf seamlessly between slashdot, hotmail and the MSDN site without needing to retype their passwords.
Unfortunately, slashcode 2001 will only allow users to post via a special ActiveX rich text edit control. However, this new control will enable users to embed great streaming multimedia content in their flames and trolls. The port of this control to non-IE6 platforms may be done by a third party at a to-be-determined date. In the meantime, Windows XP will now be the /. user's platform of choice.
This is really quite sad, but maybe my emotional response is tied up in historical beliefs that no longer hold. We've been buying VA boxes where I work for some years, now (y'all know they used to be "VA Research") because there historically wasn't any other place to get preassembled boxes made with bleeding-edge SMP mo-boards, certainly not with Linux already installed.
But these days, you can buy SMP from Dell, and with Linux installed to boot. Was VA's hardware business, then, a victim of Linux's success?
Cantankerous old coot since 1957.
The name 'NewsForge' is actually kind of disturbing.
Any journalism major, even in the first year of school, knows that journalists and/or news sites don't 'forge' the 'news' whole from raw materials. Their job is to remain outside of the 'news creating' process, and instead to report on the news objectively as it happens. It's very Katz-like to wander around 'creating' news.
'NewsForge' is a shockingly illiterate title for a 'News' web page.
Actually they are going to make money from configuring Cisco equipment for Exodus...
oops.
--T
http://www.theMediaBunker.com
They should definately concentrate on their core business, which is buying websites to raise awareness which in turn helps them to raise more VC which helps them to buy more websites...and so forth.
I had thought that the value-added hardware sales, which VA had focused on, would have the best chance at generating a positive cash flow.
I thought that selling a 'free' OS like Red Hat would be more difficult, but these announcements(this and RedHat's quarterly results) seem to show just the opposite..
Oh, well, What I'd really like to know is if there will be any really good sales on VA Equipment?
Looking for any old 8-bit Heathkit/Zenith software/hardware - http://heathkit.garlanger.com