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SGI Warns That Bankruptcy Might Be Year-End Option
tbcpp writes "OS News reports: "SGI issued its most ominous regulatory filing to date, warning that a bad 2006 could force the former high-flyer into bankruptcy. In order to improve its business, SGI will consider measures ranging from axing or selling off product lines to pursuing 'a strategic partner or acquirer.' The hardware maker will basically look at anything and everything to remain a going concern.""
Recently I was working on a project that involved an SGI server. It was initially just for simulation but it needed to render LADAR images and also show pretty graphics of planes flying over terrain.
When I got up to present it, I had made a video that captured the output through a capture device of the SGI box. It was a real pain in the ass to capture that in high quality but I did. One of the females in the audience (and it was a large audience) raised her hand and asked me why it looked like shit. I told her that it was because SGI servers concentrate on points of location--not really graphics. She balked at my explanation and kind of scoffed at me for not finding another alternative that sold better. She told me her son's PS2 rendered better graphics than that. I agreed though I said her son's PS2 wasn't concerned about exact locations and LADAR images.
What I'm trying to say is that they've been surpassed in quality.
Oh, and another thing, I had to get these LADAR images across the network onto a Windows machine that was running a webservice. Let me tell you that the support for NTFS and SAMBA servers on SGI servers is really not there anymore. I barely got something to work and that was pretty ganky.
My coworker (who is ten years older than I) told me that those purple boxes used to sell for ~$125k. Now, he says you can pick up the newer ones for around $25k. That's quite the drop in market dominance.
Goodbye SGI, I'm sorry things didn't work out better for you. You lost site of what kept you floating. In the long long ago, I hear tell you made the product. Today, that foothold has crumbled.
My work here is dung.
who buys their IP, that is, the IP which isn't secretly pwn3d by Microsoft already. That is, if SGI has any IP that isn't secretly pwn3d by IBM already, either. SGI gave us whizbang graphics, spiffy NUMA stuff, and XFS (and more, let the list begin here). Some of the people there are obviously clever. Let IBM buy them for a song, and set up a skunkworks project somewhere.
I want to delete my account but Slashdot doesn't allow it.
I have heard it said of Microsoft that they have so many really smart people, and you don't see it in the products that they actually release to us normal humans. (I have even heard people who work there say it: they say they have really cool stuff in house, that somehow never gets out, or when it gets out, the cool has been removed.)
I'd be interested in hearing other examples of "really smart engineers working there but the results that outsiders see are mediocre". Amazon.com is another example that comes to mind (I used to work there).
I do not have an explanation for why this happens so often.
A counterexample: I worked at Apple in the early 90s and, given the amount of really dim or useless people we had there, we had really GREAT products.
I wouldn't be surprised if Apple considers acquiring SGI. They certainly can afford it these days, and benefit from all the UNIX goodies that SGI has produced over the years.
Back during the .com bubble bust, I was looking to invest in a company with some of my RedHat stock money I'd made (post IPO). A coworker who had been dabbling in trading heard my question. He suggested I invest into SGI. I looked 'em up and they were somewhere around $10. Having just invested in a stock that I bought at $50 and sold at double the price, I wasn't too keen on buying such an inexpensive stock. He just shook his head knowingly and looked at me with a big smile and said:
"When there's blood in the streets, buy!"
So i finally got around to buying it at $12/share. That was its peak. I waited and waited, but only lost and lost. I sold most of it at something like $5/share.
Two lessons learned:
1) Some companies have more blood than you think they do.
2) I am not (nor was ever) a real stock trader.
To hear that SGI's only now announcing the possibility of bankruptcy tells me they had years worth of blood left...
(My friend never sold his stock and AFAIK still holds his shares!)
Two fish swim into a wall, one turns to the other and says, "Dam".
Huge proprietary one-off systems, divisions that fight each other, a virtual pinball machine of executive changes, marketing that would make even DEC blush, it's no wonder why SGI is toying with Chapter 11. This after several years of trying to get themselves sold, is just so amusing.
I have a strong pity for people that thought SGI was a Silicon Valley progenitor and captain, only to find that it was really a dopey engineering company determined to constantly reinvent the wheel, never use anything anyone else did, and had the quintessential not-invented-here sickness that nearly killed Silicon Valley after co-inventing it.
It's my fervent hope that they just liquidate, and get it over with. My advice: skip Chapter 11 and go straight for seven, and put SGI and its employees (I've known many) out of its constant misery and pain.
---- Teach Peace. It's Cheaper Than War.
SGI was my first non-government job, and my first time exposed to the Bay Area, back in the early 90's. SGI was just on a tear then, with Jurassic Park and virtual reality and so on, and it was a blast to work there. In fact, looking back, I'd say I was happier when I was at the office than when I wasn't. The people were brilliant, the products were dead sexy, and the environment was all about balance. For instance, while the group I worked in taught me a lot about what can be done with a polygon, they also introduced me to sumo wrestling (those padded costumes), windsurfing, motorcycle riding, a Grateful Dead concert (one of Jerry's last ones), and strip clubs (bachelor party for a team member).
If there's ever a funeral for SGI, I'd show up.
I was reminded of this interesting post I had found on an mit email archive a few months back... http://projects.csail.mit.edu/gsb/archives/old/gsb -archive/gsb2001-06-29.html
Its the Itanic... she sinkin n draggin everyone with her. So much for the MIPS.
[all generalizations are untrue except this one]
SGI's MIPS once ruled 64-bit computing (along with Alpha). Somehow all changed when Belluzzo convinced them to become yet-another-wintel dealer; and Intel bluffed them into giving up their technical expetise with Itanium vaporware.
You kinda feel sorry for them - but this has been a long long time coming. Funny thing is that people call Itanium a failure; while in really it's key in helping Intel take 64-bit leadership away from MIPS & Alpha -- and Belluzzo got a president job at microsoft rummored to be largely because of his role in killing the microsoft competitors of SGI as its CEO and crippling the non-wintel parts of HP in his exc management role there.
Meanwhile the products that were relevant to graphics customers are long gone, and with all their hardware talent moved to Ati & Nvidia, companies like Apple have caught up to take their professional consumers.(To the point where Apples now do all the things which those amazing Indigo^2 boxes did all those years ago.)
Smart question, it's an open standard now, with Apple being the key vendor who needs it the most, my guess is the driving force moves to them with the Card vendors keeping in step. For some history, the first SGI I worked with was a 4D20, which is back 1988 or so, did elections, game shows, weather gfx the whole lot with them. But now it's a PC world and Nvidia/ATI are driving it ( mind you Nvidia is SGI reincarnated in many ways, or how Jim Clark wanted it to go back in '93 or so ) and I would never want to go back to those days, we don't spend alot less on kit, but we have so much more redundancy and functionality at 1/10'th the price for hardware.
I don't blame them for going down the tubes. The fact is, their niche doesn't exist anymore. When you look at all the top companies from 1990, hardly any are left. Those that survive are in niches which happen to still be profitable - and generally much less so (Oracle, Sun). Successfully re-inventing a sizeable business on the fly hardly ever happens. And no, I wouldn't count Apple as an example of that, unless they leave the PC business. HP has changed its business more, but they're not a standalone company anymore and also aren't doing terribly well.
Maybe they aren't taking in cash hand over fist like they used to, but SGI still holds some serious patents that are being used by Nvidia, ATI, and other major players. I doubt they will go the SCO route and start suing everyone, but don't be surprised if there is a bidding war over this particular bloated corpse.
Schwartz ain't all that stupid. He knows that the only way for Sun to keep going is high volume business (unlike SGI). That's where Opteron and OpenSolaris come in. That's where certifying Linux on Niagara comes in. That's where Java comes in. That's where the special Oracle pricing comes in. And so forth.
SUNW has been quite stagnant, but I think that's because Sun is doing way too much, right now, for people to track and understand. The analysts are mostly scratching their heads and playing the waiting game. In three years, the stock will either be triple or 1/3 what it is now--it will simply take time to validate Sun's new business model.
"I think this will eventually catch up to Sun also"
Except sun is still innovative.
dtrace, ZFS and zones on the software end (Solaris runs on sparc, x86 and amd64), UltraSPARC T1 on the hardware end (coolthreads, look it up). That said, they even offer linux machines if that's what floats your (phb's) boat.
I don't work for Sun or anything either, btw.
I once did a fellow ship with these guys in 00 and was really impressed with their product. I was at the main campus that one day in April when the CEO gathered all of the employees into the cafeteria just off the yellow brick road and told the employees exactly how much trouble they were in when their stock completely tanked. It is really sad considering some of their hardware (Onyx and Origin) were not only innovative, but kick a$$ as well. Hopefully someone will pick them up. I would like to see Sun gobble these guys up and take control of their machines!
SGI did try this even after they blinked in the NVIDIA suit, they went after Microsoft over XBOX (which Nvidia didn't have the rights to sublicense), Microsoft bought all of SGI's 3D graphics patents outright. SGI has almost no graphics patents anymore, just a license from Microsoft to use the ones they used to hold.
And no, I'm really not joking or making this up, Microsoft now owns almost all of SGI's graphics patents outright.