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Is the Game Finally up for SGI?
Rob writes to mention a Computer Business Review article looking at the bankruptcy of SGI, and whether the company is planning on a comeback. CEO Dennis McKenna is emphatic that the company isn't just looking for an exit strategy, but it's hard to see where they could go from here. From the article: "SGI has more challenges ahead, and I still find it hard to believe that after all of the chances it has had to run a profitable server and visualization business in the past it can miraculously do so now, selling lower-end boxes on even slimmer margins. But I'm hoping that the Chapter 11 has provided the necessary wake-up call for the company to get really lean really fast, because only from a more stable financial footing does it have any hope of fighting its way back onto new technology buyers' wish-lists."
> How much more prestiege there is to be gained, especially for nVidia who weren't picked, I don't know.
nVidia poached most of SGI's engineers when they went big, which I guess soured their previous relationship. I suspect the decision to switch to ATI was based on politics, the sort that drive SGI into the ground into the first place. Good riddance
Oh, pardon, that's sgi, not SGI. Ooh, lowercase, how trendy. That's the sort of thing they focus on over in Mountain View these days.
I'll miss SGI about as much as I'll miss HP if they ever go under. The real company died a long time ago, we just haven't whacked their shambling zombie corpse with a shovel enough times yet.
Done with slashdot, done with nerds, getting a life.
...is that SGI's least-expesive system costs a nice $9,800. That's for one computer, running windows or linux. Basically a nice PC. Granted, it comes with 2GB ram, and some nice features. But still... ...and people thought Apple was expensive...
They did just break a memory bandwidth record yesterday.
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http://biz.yahoo.com/prnews/060717/sfm024.html?.v
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When SGI announced their x86 based line of servers I can remember thinking the same thing, "why would I buy this $3,500 dollar PC from SGI for $6,000?" It seemed to me as if they had the same problem that Sun currently has, not being able to decide what business they're in.
We (The Dutch Weather Service) bought an Altix in April.
Their hardware rocks. The software - though complex, on three racks using a common file system - works.
I never believed in Itaniums, but for our code (heavy vectorizable, large memory models) they fly.
In short, if SGI collapses, in our market the loss will be quite noticeable.
The problem with SGI is that they don't really have any compelling products anymore. They have some Linux-based HPC stuff, but I think they've lost the early lead they might have had (as a result of their clustering experience for graphics stuff) in that market to IBM. Then they have some Itanium workstations, which are hideously overpriced, and aside from being Itanium seem to pretty much be a run-of-the-mill workstation in a neat case. (About the only feature they have that you can't get on something from Sun/HP/IBM is a binary compatibility layer for running IRIX applications side-by-side with Linux ones.) And then of course they have some IRIX workstations, for the few people who still have a business reason for staying with IRIX.
... meaning they're not going to be purchasing a lot of new gear.
But most of the people still running IRIX are doing so because they have legacy applications that they need to use, which assumedly already runs on their existing hardware
SGI is rapidly running of of stuff to sell. What they do make looks really neat (gotta love purple), and I'd love to have one under my desk, but it's tough to come up with a business case for the premium it seems like they have to charge in order to stay afloat.
As much as I hate to say it, being someone who's drooled over SGI gear for years, I think they need to exit the hardware business. Or perhaps license the SGI hardware brand out to someone else, to use as their high-end workstation brand. Then pare the company back and concentrate on software for the very high-end visualization markets, and perhaps offer consulting services for people converting from IRIX to Linux.
It seems like they tried to play IRIX for far too long after the writing was on the wall, and the gamble with Itanium didn't help either. Running a single-vendor OS on what's rapidly becoming a single-vendor hardware platform isn't something that many people are going to be interested in.
"Ladies and gentlemen, my killbot features Lotus Notes and a machine gun. It is the finest available."
I would use this oppurtunity to buy Irix and use it to build the next windows ala Mac OS X. Just graft a new UI based on the aero code on top and presto...secure os with really memory management, XFS, clustering and more. Legacy apps could run in a virtualization layer and Microsoft would get a solid, tried and true OS that is also proprietary and closed-source. It would be a big job to replicate windows on a UNIX base (especially on the server) but I suspect it wouldn't take as long as Vista has.
Sig removed because it was obnoxious
Gee, I had my Slashdot article on the SGI bankruptcy rejected back on May 8th when it actually happened. Two months later, the bankruptcy gets a mention on Slashdot.
SGI's main remaining business is real estate. They own many buildings in Mountain View, most of which they lease to Google. Due to some bad decisions (like signing up for a 55-year land lease in 1995) SGI loses money on that deal. Then they tried a sale/leaseback deal with Goldman Sachs and dug themselves a bigger hole by locking in their rent at the top of the dot-com boom. A friend at Google says that SGI is a "great landlord", though.
SGI doesn't really have much left in the way of manufacturing facilities. The only thing left is Chippewa Falls, the old Cray facility. They had 1,858 employees left at the start of the bankruptcy. SGI had way too much legacy administrative overhead. They had 18 different corporate entities, from Cray to MIPS to Parallel to Alias/Wavefront, and 43 more marketing subsidiaries in various countries. Most of those organizations will disappear in the bankruptcy.
From the filing: In the last several years, SGI has faced a number of challenges, which, taken together, have had a negative impact on SGI's overall financial performance. In the late 1990's, SGI made a series of investments in strategies and technologies that yielded less than the expected results.
Er, right.
Realistically, what happened is that SGI was totally unable to cope with their high-margin business becoming a low-margin business. Few companies succeed at that transition, IBM being a notable exception. And even IBM finally bailed out of PCs.