Will consolidation hurt innovation?

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Speaker: Consolidation. Good for customers? Bad for customers? What are the concerns?

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Speaker: So I was at -- just as a matter of general opinion, I have been in favor of consolidation. I have actually -- I've been impressed by how well Oracle has been done -- been doing with their acquisitions and really think benefited from the fact that the vendor in this case took on the task of integrating products that I was already using and adding value by for me by doing that. The later trend of now increasing the support and maintenance substantially, actually, I think, has reversed that trend somewhat. I think a lot of companies are now looking at, "Now, I don't want to have to depend on one -- just one vendor for all my ERP and systems needs in general. I've got to be able to have a two-end strategy and start bringing in some diversity in the environment, just for the -- to have an alternative in general." I -- overall, I think that the consolidation that I've see in the last 20 years, I certainly have benefited from as CIO in general. I think that being able to have more strategic relationships and really have the deep relationships that -- where you have -- can sit down with a vendor directly and actually lay out what it is that you want to do and depend on the vendor to help you in that is an advantage if the vendor actually picks up their side of it, which doesn't always happen.

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Speaker: At Home Depot and at eBay?

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Speaker: You know, I'd tell you that, in general, there's always concern when there's a lot of consolidation, partly because of the control that those vendors have, our suppliers. And also, the way they behave. So if in the past their behavior was to, every year, give you a X percent increase on your maintenance, even though you're not getting more value for the money, it was a challenge because it was always a fight, or a negotiation, depending upon what you wan to call it, right?

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Speaker: Loud conversations.

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Speaker: Loud conversation. But, you know, if the behavior was different, it'd be a different story. I think it's -- the behavior's not -- it hadn't been such that the experience was going to be a pleasant one when it all happened, so that's been my experience so far. I don't know; what do you guys think?

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Speaker: You know what? I -- I'm not sure that I agree that there have been these fantastic benefits to the IT community from the consolidation. And that pretty much goes across the board. The -- you know, we're gonna fuse the world into --we're gonna do nothing except for, you know, apparently have a underlying architecture that -- or infrastructure that's gonna be the same now with Sun. I -- I'm not sure that the improvement that they've made on the product with the speed that they've done is half of what the innovation would come from individual models that are being driven by themselves. And that's -- what my observation is is that consolidation has taken a pause as they integrate in the innovation cycle. And in products like Siebel, it's allowed Verticals on Demand, Salesforce.com, whatever you want to call it, to basically walk in and potentially disrupt that -- now that's fine because that's a completely different sales models. Maybe it'll actually drive more innovation in the competition. But it hasn't necessarily unraveled any of the complexity that was there before. And now they're moving the price up as a gotcha. And I'm all for paying more money on an annuity when you're delivering more value. I just don't see it. I just -- it just hasn't got there yet, for me. And the more consolidation -- I think the more dangerous thing is that the continued appetite for consolidation may go gather in some of the early start-ups that could disrupt, and the innovation, instead of being imported, will just be sucked down. And the big machine will keep going.

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Speaker: Yeah.

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Speaker: That's my fear.

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