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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.
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.
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.