Chaos or Control?

Commentary

Workstation 2000 has sold hundreds of preloaded Intel-based workstations into some of NeXT's largest accounts. As an informed player in the marketplace, I also hear from a lot of people who purchased NEXTSTEP and a PC clone and became frustrated with their difficulties in loading the operating system. Some even give up and just load Windows, muttering that NEXTSTEP is an impossible OS. I wonder if these unhappy potential users are hurting NeXT at a time when growth is so important.

Currently, anyone with a valid resale certificate can purchase NEXTSTEP from a distributor, install it on a system, and resell it preinstalled on a '486 or Pentium. A lot of the calls that we get asking for help come from this quarter: customers who have bought systems from small vendors with limited NEXTSTEP expertise. Both these unhappy customers and inexperienced vendors hurt NEXTSTEP's reputation in the marketplace.

So the question arises: Should NeXT continue to allow unrestricted sales of NEXTSTEP?

The answer is still yes.

NeXT has already taken steps toward restricting distribution by classifying systems preloaded by the manufacturer as "certified," while other NEXTSTEP-compatible systems are merely "listed" by NeXT. According to NeXT, the different ratings affect how vigorously NeXT will stand by its OS on that particular machine. But which machines make the certified list seems to depend less on how well the hardware runs NEXTSTEP than the PC-market presence of its manufacturer. This marketing reality offers few benefits to the end user.

Large PC manufacturers (Compaq, Dell, and so forth) think in terms of millions of units, not tens of thousands. The PC marketplace (dominated by DOS, Windows, and other future large viruses) is huge and will continue to dwarf the UNIX marketplace in the foreseeable future. And even within the UNIX marketplace, NEXTSTEP is well positioned but still has limited acceptance in comparison with market leaders like HP and Sun.

Given these current realities, NEXTSTEP will languish on the shelf because of neglect and a lack of energetic marketing by PC manufacturers. They will always put their resources to work where their revenue comes from promoting Microsoft products.

This fact becomes clearer when you look at NeXT's target customers: large firms that need to develop mission-critical custom apps. Because of their focus on development rather than productivity, they are are among the most sophisticated of computer buyers. And when it comes to selecting platforms and vendors for development and deployment, their selection process is thorough and exhaustive. They prefer to buy their systems from hardware vendors that are NEXTSTEP-oriented and as technically competent as they are increasingly, firms in NeXT's VAR channel.

Yet it is the VAR channel that would be devastated by decisions to restrict NEXTSTEP distribution.

Time and again, at large and small accounts all across North America and Europe, NEXTSTEP-savvy VARs have stepped in to help close sales. Time and again, these VARs have answered the "help me" phone calls of dismayed customers. And time and again, these VARs have pushed the OS with the kinds of resourceful marketing that big PC manufacturers seldom undertake.

NeXT's field-sales organization is still small but is required to produce some pretty impressive numbers this year. A VAR that has staked its corporate future on NEXTSTEP systems also has a vested interest in helping NeXT achieve these goals. VARs take a dedicated approach to the sales process and, by definition, add value. They have the technical staff that can perform the customization that is usually required for a large deployment. The relationship goes far beyond simply filling demand for hardware; the teamwork between the VAR and NeXT builds customer confidence and helps NeXT close the sale.

Ultimately, the marketplace will dictate the right channels for delivering NEXTSTEP systems to the growing customer base. Strong partners will grow and profit from NeXT's good decisions and new alliances and the weak or incompetent players will disappear. Perhaps some fine-tuning of the distribution strategy for NEXTSTEP is in order, but restricting it too severely would damage some of the small but growing companies that have proven to be NeXT's strongest proponents. And then we'd never know just how much they might have contributed to NeXT's future success.

Tim Finnegan is president of Workstation 2000. He was a district sales manager at NeXT from 19901993. Before that, he worked at HP and Apollo.