Slashdot Mirror

← Back to Stories (view on slashdot.org)

HPE Acquires SGI For $275 Million (venturebeat.com)

Posted by BeauHD on from the age-of-acquisition dept.

An anonymous reader writes: Hewlett Packard Enterprise has announced today that it has acquired SGI for $275 million in cash and debt. VentureBeat provides some backstory on the company that makes servers, storage, and software for high-end computing: "SGI (originally known as Silicon Graphics) was cofounded in 1981 by Jim Clark, who later cofounded Netscape with Marc Andreessen. It filed for Chapter 11 bankruptcy in 2009 after being de-listed from the New York Stock Exchange. In 2009 it was acquired by Rackable Systems, which later adopted the SGI branding. SGI's former campus in Mountain View, California, is now the site of the Googleplex. SGI, which is now based in Milpitas, California, brought in $533 million in revenue in its 2016 fiscal year and has 1,100 employees, according to the statement. HPE thinks buying SGI will be neutral in terms of its financial impact in the year after the deal is closed, which should happen in the first quarter of HPE's 2017 fiscal year, and later a catalyst for growth." HP split into two separate companies last year, betting that the smaller parts will be nimbler and more able to reverse four years of declining sales.

67 of 100 comments (clear)

  1. I wonder what by saloomy · · Score: 2

    IP or market segments they are looking to expand to. I haven't seen SGI products in years.

    1. Re:I wonder what by rijrunner · · Score: 1

      I saw they have $500 in revenue last year, but I would be very surprised if they were in the red. I suspect this was to try to position for the USPS contract renewal and for customer transfer. HP did something similar with Apollo back in the day. (Compaq and a slew of other businesses were still going concerns. Apollo was on its downward spiral when HP acquired them.)

    2. Re:I wonder what by rijrunner · · Score: 1

      I meant, I would not be surprised if they were in the red

    3. Re:I wonder what by epiphani · · Score: 2

      The traditional products SGI was known for are gone... this new company, Rackable, which lifted the SGI brand in 2009, does some pretty interesting integrated rack products, both on density and power consumption.

      What I don't understand is how HPE bought a company that did over $500M in revenue for $275M. This doesn't make sense.

      --
      .
    4. Re:I wonder what by plopez · · Score: 1

      revenue != profits. Net income ~ -39 million. Probably bought for their technology portfolio.

      --
      putting the 'B' in LGBTQ+
    5. Re:I wonder what by hambone142 · · Score: 1, Troll

      HP hasn't had a successful acquisition since they bought Convex Computer decades ago. They essentially trash every company they buy and either let it die or sell off the remains. Palm, EDS, Zenith Data Systems.... it goes on.

      Since HP is now run by bean counters, acquisitions give an "illusion of progress" to those who cannot lead innovation.

      This has been a systemic problem with HP since the Fiorina days.

      The company is dying and most of their innovators have moved on in frustration.

    6. Re:I wonder what by Anonymous Coward · · Score: 1

      What I don't understand is how HPE bought a company that did over $500M in revenue for $275M. This doesn't make sense.

      High revenue but very high costs of goods sold and very lengthy sales cycle. RFP, spec, tender, acceptance, build, install, commission, acceptance. It can (and does) take years.

    7. Re:I wonder what by guruevi · · Score: 1

      Looking over their site, it doesn't look all that interesting. It's just a standard reference Intel configuration. I can get the same from SuperMicro and a host of other sites probably for a lot cheaper.

      --
      Custom electronics and digital signage for your business: www.evcircuits.com
    8. Re:I wonder what by Bing+Tsher+E · · Score: 1

      When SGI went down the shitter, and dropped the MIPS architecture, they immediately started making Wintel boxes that ran Windows NT. The feeling seems to have been that they were somewhat better than average Wintel boxes.

      I can't figure out why anybody would ever have bought one of them, but they eventually turned up on the University Surplus equipment auctions. Nobody was much interested at all in them at that point.

    9. Re: I wonder what by Anonymous Coward · · Score: 1

      Um... Intel, yes, Windows, no.

      SGI bought Cray, kept the engineers, and sold off the branding. They then made supercomputers â" first with Itanium, later with Xeon.

      Their UV system is probably the last huzzah for la he shared memory systems, made by nearly retired engineers who hated clusters passionately. (Cray himself referred to clusters as a team of chickens)

      While you could boot Windows on a UV system, it was limited to 256 cores. Linux didn't have that limitation. Terabytes of RAM, millions of cores.

      They sold a lot of RHEL and SUSE Linux.

    10. Re: I wonder what by EvilAlphonso · · Score: 1

      Circa 2000, the SGI workstations were indeed Wintel boxes with NVidia cards... at an SGI price.

    11. Re:I wonder what by KiloByte · · Score: 1

      I haven't seen SGI products in years.

      Well, their IRIX workstations were just pure awesomesity!

      --
      The creatures outside looked from Alt-Right to Antifa; but already it was impossible to say which was which.
    12. Re:I wonder what by Anonymous Coward · · Score: 1

      At that time, the choice was 32-bit UNIX workstations at UNIX prices (An Indy workstation cost £10K+ for a basic system just for software OpenGL). PC's were rapidly catching up with new boards coming out every three months; multi-texturing, hardware lighting, programmable vertex programs, programmable fragment programs. Even a 450Hz Dell PC could run SGI red book tutorials with lighting and hardware texture mapping. Film industry startup companies were getting fed up with this price difference. A single desktop PC might not be as powerful as a workstation, but a cluster of them are more reliable as a render farm and can be repaired/upgraded inhouse.

      Then Microsoft was marching around, banging on a large drum and shouting that "UNIX was Legacy! Windows NT is the future!" non-stop day and night. That freaked out more shareholders. One problem for commercial CAD/visualisation application/animation developers was that they couldn't support every single combination of OS and hardware (Alias, Wavefront, Softimage, Photoshop were the leading applications of the time). So they could support at most five workstation vendors. When Windows NT comes out, that knocked one workstation vendor out of each market segment. SGI was convinced that Hollywood would continue buying SGI workstations because they had the SGI logo on the monitor, and artists/animators would only want to use anything with the SGI logo on the front. Meanwhile everyone was getting used to working with PC's, even if they still had CRT monitors at this time.

      By then it was too late. Engineers left for Nvidia and 3Dfx.

    13. Re: I wonder what by unixisc · · Score: 1

      Precisely. The only time SGI took a stab at NT - actually, it was their subsidiary MIPS that did - was at the beginning of Windows NT, when they made a workstation called the Magnum based on an R4000 CPU and an EISA bus (mirroring DEC's first foray into the NT market w/ an Alpha 150MHz on the same configuration). That was somewhere in 1994-95, before Windows 95 was even out

    14. Re:I wonder what by unixisc · · Score: 1

      I sometimes think that companies like Silicon Graphics and DEC could have served themselves better by making a serious push to get their entire suite of applications on NT for their RISCstations. Like offering a wide range of price points for AlphaSstations to developers to have a variety of CAD applications on NT/Alpha: they could have held their own against Intel for a bit. Similarly, Sun, which was heavily anti Microsoft, and HP, could have standardized on NeXTstep, which was just ported to their workstations. IBM could have done OS/2 for PowerPC and made that an option for companies that were trying to enter the Mac clone market, like Power Computing, Umax and Motorola PSD. There wouldn't have been a monopoly, but neither would there have been 10 different types of UNIX w/ widely varying specs where each port was a unique project.

      However, what really killed the UNIX workstation market was once Microsoft unified the code base under NT, thereby making it possible for PCs to have multiple CPUs. Intel then introduced the cores, and since they were several generations ahead of DEC, Sun, IBM, et al, they had no problems tossing 2, 4, 8 cores on a CPU and catching up on the competitiveness - the only drawback the Pentium had vis a vis RISC. In the meantime, Linux had also caught on, so if somebody wanted to run Windows applications AND avoid the traditional drawbacks of Windows 98, there was Wintel NT, and if one wanted inexpensive Unixstations running around a standard UNIX like OS, there was Lintel. Once that was the picture, the case for SPARCstations, Irixstations, or POWERstations shrank rapidly. I do miss those, and wish we could have something like those today, but running things like NeXTstep or GNUSTEP, Windows 7 on RISC or OS/2 or Linux or PC-BSD

    15. Re: I wonder what by unixisc · · Score: 1

      I recall Mathematica being there on it. What else did it have?

    16. Re:I wonder what by secret_squirrel_99 · · Score: 1

      HP hasn't had a successful acquisition since they bought Convex Computer decades ago. They essentially trash every company they buy and either let it die or sell off the remains. Palm, EDS, Zenith Data Systems.... it goes on.

      Since HP is now run by bean counters, acquisitions give an "illusion of progress" to those who cannot lead innovation.

      This has been a systemic problem with HP since the Fiorina days.

      The company is dying and most of their innovators have moved on in frustration.

      That isn't quite true. While some have certainly been busts, others 3PAR and Aruba for example have been quite successful.

      --
      If privacy had a tombstone it would read "We did it for your own good" . -- John Twelve Hawks
    17. Re:I wonder what by cthulhu11 · · Score: 1

      You found that acquisition successful? At 83 cents a share?

    18. Re: I wonder what by haruchai · · Score: 1

      "At least Kubrick fans will always remember IBM"

        I'm sorry, Dave, I'm afraid I won't

      --
      Pain is merely failure leaving the body
    19. Re: I wonder what by haruchai · · Score: 1

      Precisely. The only time SGI took a stab at NT - actually, it was their subsidiary MIPS that did - was at the beginning of Windows NT, when they made a workstation called the Magnum based on an R4000 CPU and an EISA bus (mirroring DEC's first foray into the NT market w/ an Alpha 150MHz on the same configuration). That was somewhere in 1994-95, before Windows 95 was even out

      Not the only. The SGI Visual Workstations didn't show up until 2002, initially running NT4 and moving to Win2K some time later and this was SGI, not MIPS.

      http://www.cnet.com/news/nt-wo...

      --
      Pain is merely failure leaving the body
    20. Re: I wonder what by haruchai · · Score: 1

      Have a look - https://en.wikipedia.org/wiki/...

      AutoCAD, Framemaker, Illustrator, MATLAB, Wordperfect, Alias, Maya, Renderman, Kai's Power Tools. Lightwave 3D

      Here's an O2 with a few of those installed - https://www.youtube.com/watch?...

      --
      Pain is merely failure leaving the body
  2. The Graveyard of tech by rijrunner · · Score: 1

    RIP SGI.

    1. Re:The Graveyard of tech by TheGratefulNet · · Score: 5, Interesting

      I worked for SGI in mtn view a few years before their demise.

      one of the funnest places I was ever at. such a shame to see them go. even worse to think that google (puke!) took their campus over and its now run by ad-men, so to speak.

      not to mention that traffic around shoreline area is a nightmare, all the way up rt 101 for several miles. thanks again, google ;(

      sgi had class and created some stellar products. sadly, they went down a dark side with the WBT project (internally called 'wintel box thing' their x86 systems running modified NT and no BIOS).

      but wow, working at sgi was so much fun. silicon valley used to be cool. now, its a fucking sweat shop for h1b's and 'social media' companies (double puke).

      --

      --
      "It is now safe to switch off your computer."
    2. Re:The Graveyard of tech by afgun · · Score: 1

      No no, Stellar was a different company. ;-)

    3. Re: The Graveyard of tech by Anonymous Coward · · Score: 2, Insightful

      This. I was at SIGGRAPH in 1997 and it was like a playground for SGI enthusiasts. By 1998, we were all running Renderman on whatever clusters we could throw together. It was becoming clear that the future of graphics rendering was going to be in large clusters working together. SGI was built around the concept of single machines being big workhorses. When you have a cluster, you start caring less about the individual machines and instead focus on frames per second that you can render and the cost of the cluster.

      SGI just couldn't win that battle because the machines were simply too expensive.

      Linux was storming the (server) world and basically, as you say, both SGI and (real) UNIX, overnight, found that their milkshakes had been drunk -- so to speak.

    4. Re:The Graveyard of tech by jandrese · · Score: 3, Interesting

      I was working for SGI as a co-op when that Pentium 4 thing came out. We got a demo unit and I was pretty disappointed. The flatscreen monitor they shipped with it was way more exciting even if it experienced epic tearing when we played the demo video. It's the only PC I ever used that has RAMBUS memory.

      We did have one guy come down and give a demo of Maya (or maybe it was Alias Wavefront at that point? I can't remember) and being amazed at how the demo guy could build and animate an entire scene in about an hour, even though the interface appeared to be 100% black magic. IIRC he had a spaceship he had built from a box flying around a city he built fighting a dinosaur he pulled out of some asset library.

      --

      I read the internet for the articles.
    5. Re: The Graveyard of tech by Anonymous Coward · · Score: 2, Informative

      I can't disagree. They spent millions to develop their Altix and UV lines (big shared memory systems, thousands of cores).

      While they sold clusters, it was half hearted at best. They eventually stopped updating the cluster hardware to "focus" on their behemoths. A lot of the Crayons (ex cray engineers) at SGI hated clusters with the passion of a thousand suns.

      They were also amazingly overbuilt systems - custom designed fans instead of commodity fans. Their chassis were built like tanks - they used an enormous amount of steel, and weighed 4-5x more than anything else on the market.

      A lot of the engineers were so blinded by their hatred of clusters that they forgot that price matters to a customer. If you're doing the same job, and one vendor costs 5-6x more for the EXACT SAME OUTPUT, you've got to expect that one vendor to lose most bids.

    6. Re: The Graveyard of tech by silentcoder · · Score: 1

      I remember sometime circa 2003 a headline on /. that Linux had replaced more NT systems than commercial unix systems that year - this was big news because until then, Linux was mostly growing by killing of every unix systems company. The real SCO sold their unix business to Caldera (a Linux company) who would later go on to sue IBM over Unix, Sun died a most inglorious death despite trying very hard to reinvent itself in the naughties, SGI and IRIX went the way of the dodo, even HPUX got relegated to little more than maintaining legacy systems.
      AIX seemed to survive but mostly as a massive virtualization platform for running Linux VMs on - a market that amazon has now effectively destroyed.

      --
      Unicode killed the ASCII-art *
  3. How is SGI relevant to HPE? by unixisc · · Score: 1

    Had HP, Inc bought SGI, I might have understood. That's the part of the company that still makes computers.

    But HPE is the EDS part of the company - the one that's into outsourcing IT services. How is SGI relevant to that? Is HPE the part of the company that still owns their server business and so on? What does SGI bring to the table?

    On a different note, who were the people still buying SGI to give them a half billion revenue? What exactly do they sell - it's not like one can buy Irix based workstations or servers anymore, or even Linux ones, from what I understand.

    1. Re:How is SGI relevant to HPE? by dgatwood · · Score: 2

      Maybe this is just another silo experiment on a broader scale—split HP in two and encourage them both to go after each other mercilessly....

      --

      Check out my sci-fi/humor trilogy at PatriotsBooks.

    2. Re:How is SGI relevant to HPE? by bobthesungeek76036 · · Score: 1

      ..On a different note, who were the people still buying SGI to give them a half billion revenue? What exactly do they sell - it's not like one can buy Irix based workstations or servers anymore, or even Linux ones, from what I understand.

      Remember, SGI is not the SGI of old. Rackable bought SGI (Silicon Graphics) and the renamed the company SGI. So I imagine most of the product line was heritage Rackable?

      --
      Karma: Bad
    3. Re:How is SGI relevant to HPE? by GNU(slash)Nickname · · Score: 1

      But HPE is the EDS part of the company - the one that's into outsourcing IT services. How is SGI relevant to that? Is HPE the part of the company that still owns their server business and so on? What does SGI bring to the table?

      No, HPE is HP Enterprise. Networking, servers, storage, etc.

    4. Re:How is SGI relevant to HPE? by hambone142 · · Score: 1

      HPE makes Enterprise hardware as well as networking hardware and IT services.

    5. Re:How is SGI relevant to HPE? by plopez · · Score: 1

      HPE is dumping EDS

      --
      putting the 'B' in LGBTQ+
    6. Re:How is SGI relevant to HPE? by nbritton · · Score: 1

      Had HP, Inc bought SGI, I might have understood. That's the part of the company that still makes computers.

      Sorry, no. HPE still makes servers and big iron. Consumer goods like desktops, laptops, tablets, and printers is what went to HP, Inc.

    7. Re:How is SGI relevant to HPE? by plopez · · Score: 1

      They are dumping off their services division.

      --
      putting the 'B' in LGBTQ+
    8. Re:How is SGI relevant to HPE? by TheGratefulNet · · Score: 1

      that's not correct. sgi renamed to sgi while it was still in mtn view. they changed their logo (lost that very cool cube icon) and their logo and name were shortened to sgi. after that they were never again silicon graphics.

      --

      --
      "It is now safe to switch off your computer."
  4. WTF? by fnj · · Score: 1

    What?? SGI still exists????? As anything more than a worthless shell? It's been a loooooong time since I heard anything from that graveyard.

    1. Re:WTF? by phantomfive · · Score: 2

      That's what I was wondering too when I saw the headline. Looks like they managed to pivot to a company that provides high-performance computing to the same company-set that uses Oracle and SAP. (In other words, probably only certain departments at fortune 500 companies).

      --
      "First they came for the slanderers and i said nothing."
  5. Re:Is Fiscal 2016 over with already? by quintus_horatius · · Score: 2

    Have they already closed the books on 2016 earnings? Heck yeah they need to get bought. The hardware running their accounting software is literally more than a month faster than anything I've seen in the industry.

    They may have a tax year that starts as early as June 1, so yeah they might be in 2017, fiscally speaking.

  6. SGI is still around? by BLToday · · Score: 1

    Well, I'll be damn, I thought they died years ago. What have they been up to all these years?

    1. Re:SGI is still around? by jandrese · · Score: 1

      Nothing related to graphics apparently.

      --

      I read the internet for the articles.
    2. Re:SGI is still around? by guruevi · · Score: 1

      The brand got bought, "SGI" is now selling basic, standard SuperMicro servers and putting the logo on it. They also apparently support your average Hadoop, SAP etc. implementation.

      --
      Custom electronics and digital signage for your business: www.evcircuits.com
  7. Re:Fuck... by UnknownSoldier · · Score: 4, Funny

    > HP, the destroyer of worlds,

    Actually it is more like this old joke:

    Q. How do you known when a tech company is no longer valuable?
    A. When HP buys it.

    *ba dum tsh*

  8. Rackable by bobthesungeek76036 · · Score: 4, Informative

    For of those in need of an SGI history lesson, the SGI currently in business is not quite the same SGI (Silicon Graphics) of old. Remember that Rackable Systems acquired Silicon Graphics back in 2009 for like $20M I think? And they turned around and renamed Rackable to SGI.

    --
    Karma: Bad
  9. Re:Is Fiscal 2016 over with already? by hambone142 · · Score: 1

    HP's fiscal year ends the last day of October.

  10. HPE Buying more hardware by plopez · · Score: 1

    They are dumping off Enterprise Services, are buying SGI, and wanted to buy EMC. I predict that they will sell or spin off their software division soon and make a pure enterprise hardware play. Which makes sense as software is hard to manage and HPE understands hardware much better.

    --
    putting the 'B' in LGBTQ+
    1. Re:HPE Buying more hardware by unixisc · · Score: 2

      Why not then buy Itanium from Intel, since the latter doesn't seem to sell it to anyone else? They can still have Intel manufacture it, or if the volumes don't justify it, have it made by TSMC or someone else on the other side of the rim

    2. Re:HPE Buying more hardware by plopez · · Score: 1

      An interesting idea. Though Intel would have to agree to it.

      --
      putting the 'B' in LGBTQ+
    3. Re:HPE Buying more hardware by unixisc · · Score: 1

      I would think Intel would be happy to. The only reason they haven't stopped making it is that HP won't allow them. If they sell it to HP, then it's no longer a losing business for them - it's an account that they can either keep or lose.

  11. Nimbler companies won't reverse customer experienc by Kobun · · Score: 1

    Every piece of HP kit we've had has been a lemon. We have a 100% failure rate within 5 years on whole classes of desktop machines that we've bought from them, and the servers I have of theirs (that are still around) are a constant headache to get a management session going to their ILO. Unless they're going to give me a batch of equipment FOR FREE to let me use for a year and see that it no longer sucks, my budget will be spent somewhere else. Forever.

  12. Re: Kind of Funny by cunina · · Score: 1

    Go buy some Chinese sugar, then.

  13. GooglePlex??? by bobthesungeek76036 · · Score: 1

    ... SGI's former campus in Mountain View, California, is now the site of the Googleplex ...

    I thought the old SGI building was now the Computer History Museum...

    --
    Karma: Bad
    1. Re:GooglePlex??? by Guy+Harris · · Score: 2

      ... SGI's former campus in Mountain View, California, is now the site of the Googleplex ...

      I thought the old SGI building was now the Computer History Museum...

      SGI campus. One of the old SGI buildings now houses the Computer History Museum; the rest of the campus is now the Googleplex.

    2. Re:GooglePlex??? by bobthesungeek76036 · · Score: 1

      I guess I'm just an old fart because back in my day there was no "campus". That building WAS Silicon Graphics...

      --
      Karma: Bad
  14. Re:You can pry by armanox · · Score: 2

    I still love my Octane. And I've got a second one sitting here as well, that I'll setup one of these days (and I've got a V6 GPU to add to it when I do!). IRIX is just so nice to work with compared to modern operating systems.

    --
    I'm starting to think GNU is the problem with "GNU/Linux" these days.
  15. Re:Fuck... by unixisc · · Score: 1

    They should next buy SCO, or Xinuos, as it's now called. Maybe CSC can do that

  16. HP where tech companies of the 80's and 90's go... by williamyf · · Score: 1

    ... to die.

    HP got Digital Equipment Corporation and Tandem Computers (via Compaq), and now Silicon Graphics as well (yes, yes, we know, SGI went Kaput and was acquired by rackspace...).

    Should have bought SUN as well...

    What's next? Cray?

    --
    *** Suerte a todos y Feliz dia!
  17. Re:Fiorina: A new verb by silentcoder · · Score: 1

    Maybe I should have cheered Fiorina's presidential bid after all. I've always said that great generally* CEOs make terrible presidents (contrary to what republicans seem to believe) since the two jobs have almost diametrically opposed definitions of "success" - but does that mean horrible CEOs will make great presidents ?

    *There are a few, rare, exceptions both in the US and globally - but generally these are people who are naturally gifted at learning very different careers and skillsets and approach the political job as a brand new career in which their past experience has very little value. The entire nature of the organisation you are now heading up is different, it's economics work according to completely different rules - and even the techniques by which you organise and motivate people are entirely different since the incentive structure is nothing alike (and neither can nor should be similar).

    --
    Unicode killed the ASCII-art *
  18. Re:HP where tech companies of the 80's and 90's go by silentcoder · · Score: 2

    I think they technically already got CRAY since Cray was bought by SGI after Seymore died. A lot of the last generation of real SGI machines were designed by ex-Cray engineers.

    --
    Unicode killed the ASCII-art *
  19. Re:HP where tech companies of the 80's and 90's go by iggymanz · · Score: 1

    eh, the descendants of the products of those acquisitions are still around. Tandem is HP's Nonstop, Compaq the servers (which still have compaq on components inside and in many firmware/drivers). The tech from DEC was sold to various companies, the most notable being various processor system designs sold to Intel and which you're using right now

  20. Re:Fiorina: A new verb by unixisc · · Score: 1

    She's now trying to become the head of the RNC. If Trump wins, I hope he includes Reince Priebus in his cabinet, but make someone like Corey Lewandowski the RNC chairman. That should show amateurs like Carly the door, so that she's forced to find a real private sector job and have something beyond HP that she can flaunt as a success.

  21. Re:HP where tech companies of the 80's and 90's go by unixisc · · Score: 1

    Sun had already been digested by Oracle. And with it, Cray. I think at some point, HP itself may get bought by Lenovo

  22. Re:Nimbler companies won't reverse customer experi by sconeu · · Score: 2

    This is HPE -- HP Enterprise. It spun off from HP about a year ago.

    HPE does the big iron. NonStop (aka Tandems), HPUX, and I'm guessing Windows servers as well. Enterprise class storage, networking, etc...

    Not the HP desktop people.

    --
    General Relativity: Space-time tells matter where to go; Matter tells space-time what shape to be.
  23. Comment removed by account_deleted · · Score: 1

    Comment removed based on user account deletion

  24. Re:Fuck... by UnknownSoldier · · Score: 1

    Ha! We could only hope.

  25. Re:Fuck... by unixisc · · Score: 1

    Actually, DEC had been bought by Compaq, which in turn was digested by HP