ANTs Software recently came (back) to my attention when, ego-surfing, I saw they had made up some falsehoods about me and posted same in their blog. So I posted about ANTs Software. Now that the ANTs Software blog is on my radar, I see there’s another post from CEO Joe Kozak stating his case that ANTs Software is a good investment. I also notice that there’s an active S-1 to sell ANTs Software stock, dated two weeks before the blog post. Frankly, it surprises me that it’s legal to recommend your own stock that emphatically while you’re in registration — but hey, I tend to be on the side of favoring more communication over less.

According to the ANTs Software 10-Q for the quarter ended June 30, ANTs Software has >$2 million in negative working capital — which this offering apparently won’t change (it’s for a shareholder to sell stock, not for ANTs to raise more money for itself).

Actually, ANTs did manage to get its working capital positive again. The key paragraph from the 10-K linked above, emphasis mine, is

The consolidated financial statements contemplate continuation of the Company as a going concern.  However, the Company has had minimal revenues since inception, suffered recurring losses from operations, has generated negative cash flows from operations and has an accumulated deficit of $156.97 million as of December 31, 2010 that raise substantial doubt about the Company’s ability to continue as a going concern. The Company also had significant near-term liquidity needs as of December 31, 2010, including $0.25 million currently due on a line of credit and $2.00 million in notes payable due January 31, 2011. Subsequent to December 31, 2010, the Company received proceeds from a $3.00 million subscription receivable (less $0.39 million in fees, including $0.24 million in dispute) for the sale of 5.18 million shares of common stock pursuant to the BRG Agreement, $0.06 million in proceeds from the exercise of warrants covering 0.13 million shares of common stock and gross proceeds of $0.75 million from the Note and Warrant Purchase Agreements.  The outstanding balance on the line of credit was subsequently repaid and the notes payable were subsequently deferred until January 31, 2013. The Company’s ability to continue as a going concern is dependent upon management’s ability to generate profitable operations in the future and obtain the necessary financing to meet obligations and repay liabilities arising from normal business operations when they come due. The Company anticipates generating profitable operations from marketing and sales of ACS and the growth of our Professional Services offerings for ACS implementations. If the Company does not generate profitable operations or obtain the necessary financing, the Company may not have enough operating funds to continue to operate as a going concern. Securing additional sources of financing to enable the Company to continue the development and commercialization of proprietary technologies will be difficult and there is no assurance of our ability to secure such financing. A failure to generate profitable operations or obtain additional financing could prevent the Company from making expenditures that are needed to pay current obligations, allow the hiring of additional development personnel and continue development of its software and technologies. The Company continues actively seeking additional capital through private placements of equity and debt.

Bottom line: $157 million in losses have produced 3 sales (with more presumably coming) of a product that isn’t that important in the first place (it just helps you move from a perfectly decent DBMS to one you might like better while saving on migration costs). That makes almost any other failure in software industry history look like a rousing success by comparison.

This piqued my interest, so — recalling that ANTs is a public company — I decided to take a look at just how successful their software products business is. Well, for the quarter ended March 31, 2010, ANTs’ 10-Q filing says (emphasis mine): 

The Company’s revenues for the three months ended March 31, 2010 and 2009 include service revenues representing managed and professional service fees for database and network maintenance and support services. Revenues for the three months ended March 31, 2010 were $1.5 million, an increase of $0.1 million compared to $1.4 million for the three months ended March 31, 2009.  For the three months ended March 31, 2010, two customers accounted for 96% of the Company’s gross revenues (Company A, 72% and Company B, 24%) compared to three customers that accounted for 97% of the Company’s gross revenues for the three months ended March 31, 2009 (Company A, 57%, Company B, 29% and Company C, 10%). The increase in revenues for the three months ended March 31, 2010 over the comparable period in 2009 is primarily attributable to professional service projects for Company A that were initiated during or subsequent to the three months ended March 31, 2009, partially offset by professional service projects for Company B and Company C that were completed subsequent to March 31, 2009.

Conditional on the Company’s technology developments being successful, the presence of customer demand and the Company having a competitive advantage, future revenues may include sales and licenses of its ANTs Compatibility Server (“ACS”) product and managed services revenue related to existing and new contracts and professional services revenue from pre- and post-sales consulting related to ACS and other database consolidation technologies. Sales of the Company’s first ACS product, which translates from Sybase to Oracle, have been limited due to the structure of the sales arrangement and go-to-market strategy. As such, the Company has structured the go-to-market strategy for the second ACS product differently via the use of an Original Equipment Manufacturer (“OEM”) agreement. Pursuant to the OEM agreement, ANTs is responsible for technology development specifically tailored to the OEM’s needs. The OEM will assume responsibility for marketing, sales and support of the technology on a worldwide basis, while ANTs will be the preferred service provider for migration projects. The Company is currently in the process of developing the second ACS product for a planned announcement and release in mid-2010. The Company intends to develop additional ACS products based on market demand and the availability of resources for development.

In other words, as of four months ago ANTs had had $0 in business in what it says is its main product area, which is pretty much the range the company has been in throughout its complicated history.  Kozak’s post did link to a claim that IBM has experienced over 300 migrations to DB2. However, that figure includes Oracle-to-DB2 migrations that having nothing to do with ANTs. And by the way, IBM’s migration strategy is focused largely on ISVs, so the whole Sybase-ANTs dust-up may be about a type of business (direct capture by DB2 of Sybase ASE enterprise customers) nobody’s sales force is seriously pursuing.

True, the Sybase-to-DB2 emulation technology hadn’t been released as of then. Even so, I think it’s a wee bit early for ANTs to be acting as if there’s been any proof it ever has had or will have any significant market success.

• Sybase’s main businesses are:
  • Classic OLTP DBMS (Sybase ASE, for Adapative Server Enterprise, unless I’ve missed yet another name change).
  • Analytic technology — mainly Sybase IQ, but more generally Sybase RAP.
  • Mobile technology. (The frequently renamed small DBMS SQL Anywhere was the foundational product of and still is included in the mobile division.)
• SAP’s thoughts on in-memory database management are interesting. However, I think SAP’s oft-repeated claim that it has a lot of important in-memory database technology to bring to Sybase (or for that matter SAP customers) is mainly smoke and mirrors. Cool data access methods, good niche database products, and broadly applicable multi-domain DBMS innovations are three different things. Granting that SAP probably has the first and thinks it has the second is not the same as giving it much credence for having the third.
• SAP claims that, 15 years after its refusal to support Sybase turned Sybase into a DBMS also-ran, it by now is “relatively simple” to port SAP’s apps to Sybase ASE, and that they will make that happen. I actually believe that SAP’s apps will soon run on Sybase ASE, where by “soon” I mean “in a couple of years for no-apologies general availability.” (Certifying a DBMS for SAP is a long process.) The main missing features — e.g., row-level locking — were already put into Sybase back in the last millenium. Nor could there be fundamental architectural problems that keep SAP from supporting Sybase ASE, or else SAP couldn’t have supported Microsoft SQL Server (which, long ago, was a Sybase fork).
• I don’t see any market or competitive dynamics that would lead the SAP acquisition to hurt Sybase’s ASE or mobile businesses. General merger management mishegas is, of course, always a possibility.
• SAP Business Objects partners with Sybase IQ’s competitors. That could be a problem. However, coopetition is pretty strong in the business intelligence market. I don’t think any of SAP Business Objects, IBM Cognos, or Oracle Business Intelligence are much held back from partnering by competitive dislike of their parent companies.
• The rest of SAP might be able to drum up some extra business for Sybase IQ.
• It would be natural for IBM/Cognos to now buy a columnar DBMS of its own. Vertica is an obvious first choice. ParAccel would surely come much cheaper. Since ParAccel has little chance of surviving as an independent company — too immature and too little differentiation to overcome that — I’d expect ParAccel’s board to jump at the chance to sell out.
• It would be interesting if SAP Business Objects would revive the CEP-based BI idea.
• I gather Sybase’s AnswersAnywhere concept network/object model-based natural language/speech recognition technology never went anywhere. Unsurprising (it seemed like it needed too much hand-building to scale semantically), but regrettable even so.
• I don’t see anything in this acquisition that would revive PowerBuilder (Sybase’s Visual Basic competitor), Sybase’s CASE (Computer-Aided Software Engineering) tools, and so on.
• And on the personal side — I’ll probably lose Sybase as a customer due to this merger, but it could have been worse. A lot of vendors smaller than Sybase are bigger customers for Monash Research.

Edit: Right after I posted this, I saw email from Sybase clarifying that Sybase’s in-memory technology, while slightly influenced by some ANTs IP Sybase bought non-exclusive rights to, is essentially home-grown. That’s what I thought, but the call sounded like it was saying something different.

Further coverage of SAP/Sybase:

• SAP believes in database proliferation
• More quick reactions to SAP/Sybase
• Technical basics of Sybase IQ
  

*The looseness in that definition highlights a key reason these technologies don’t sell well — it’s hard to be sure that what you’re buying will do a good job of running your particular apps.

This subject comes to mind for two reasons. One is that IBM seems to have licensed EnterpriseDB’s Oracle transparency layer for DB2. The other is that a natural upgrade path from MySQL to Oracle might be a MySQL transparency layer on top of an Oracle base.

At first blush, the Oracle/MySQL possibility could break the mold. Migrating from one product to another product owned by the same vendor is a lot different than migrating from one vendor’s product to another’s. Users have tremendous familiarity with upgrades where one vendor controls both the start and end points of the transition.

On the other hand, the number of cases where a vendor has bought a DBMS product and then migrating a substantial user base over to another DBMS is approximately zero. The template for reasonably successful DBMS vendor consolidations — such as IBM/Informix or Oracle/RDB — is almost always to maintain and enhance multiple product lines side by side.

As for EnterpriseDB/DB2 — if you have an application running on Oracle, why port it to DB2? Unless IBM gets aggressive on its maintenance licensing terms, that won’t even get you much of a first-glance cost saving. And while it’s annoying to do DBA work for two database brands when one will suffice — if you have those Oracle apps already running, then you also already have the DBA resource to keep them going. No doubt there will be situations where this new offering is useful and welcome, but they’ll probably prove to be rather isolated edge cases.

A couple of years ago, I did make a theoretical argument that DBMS portability should become technically easier and hence more widely adopted. But since then I’ve seen very little practical evidence to back it up.

]]> http://www.dbms2.com/2009/04/22/dbms-transparency-layers-never-seem-to-sell-well/feed/ 11 http://www.dbms2.com/2008/06/20/derek-rodner-blasts-ants-software/ http://www.dbms2.com/2008/06/20/derek-rodner-blasts-ants-software/#comments Fri, 20 Jun 2008 21:37:40 +0000 Curt Monash http://www.dbms2.com/?p=441 Derek Rodner got snarky, and blasted Ants Software. Highlights include (emphasis mine):

I have never seen more thinly veiled attempts to make themselves bigger than they are. … In 2005, they did almost a half million dollars in revenue. That’s right, I said a half million, or $467,000 to be exact. In 2006, it got worse at $288,000 in revenue and last year they did $360,000. Yet, they continue to drone on about their “consortium” which, from the outside simply looks like a beta program. Its no consortium. … And, they continue to mention a major deal with IBM that COULD be worth millions over time. You can read about it in every SEC filing. But, it has never materialized. … They announced a major Oracle partnership, but Oracle never acknowledges their existence. I think they simply signed up for the partner program at oracle and paid the $1500. … Sybase is paying them $1.4 million to do whatever they want with the entire product line from ANTs. … This means that Sybase can do whatever they want with the product, including reselling it without paying another dime to ANTs.

I’m not totally clear on why an Informix-compatible DBMS is needed in a world that already has Informix SE, but maybe IBM is overcharging for maintenance even on the low-end version of the product.

Meanwhile, ANTs, which had originally tried to get enterprises to migrate away from Oracle, is now focused on middleware called the ANTs Compatibility Server to help them migrate to Oracle, specifically/initially from Sybase.

With that as backdrop, where is all this compatibility/portability/transparency stuff going to lead? Potentially, pretty far. The technical barriers aren’t great. Given that, issues of cost, market dynamics, and so on suggest there should eventually be just as much database porting as there is porting between UNIX-derived hardware and operating systems. I.e., a lot.

A DBMS, first and foremost, is a big language interpreter. Therefore, if you want DBMS transparency, most of what you have to do is run the language, without major performance hits. In principle, this shouldn’t be hard, because SQL dialects are pretty similar and pretty simple. And in practice it’s not too hard either.

How do I know it’s not too hard in practice? Because DataDirect (now owned by Progress) has been doing it for years! DataDirect’s main business is translating ODBC and JDBC to native SQL, and it does a bang-up job. Performance hits are usually trivial, and sometimes there even are performance gains from the translation. True, there’s more to full stored-procedure-language compatibility than is commonly found in DataDirect drivers. But EnterpriseDB has been doing a much fuller job of Oracle compatibility without too much evident difficulty. And there’s the Ants example as well.

Of course, it’s not that simple. But much of the non-simplicity lies in this: If you port from one DBMS to another, you may need to totally retune your system to get comparable performance to what you had before. And that’s a costly hassle. Except – tuning is getting ever more automatic and easier. And as hardware gets cheaper, tuning is getting somewhat less important. And specifically on the analytic side, MPP so dominates SMP in price-performance that a port is likely to gain you a lot of throughput with very little tuning effort at all.

“Wait a moment!”, one might say. “The big DBMS companies make huge investments in their products. Unless that effort is utterly wasted, surely they do many things better than some upstart does.” But then, one might also have used the same reasoning to suggest that Linux could never outpace Unix. Or that Unix could never supplant VMS. Or that VMS could never compete with MVS …

Reasons that all of these arguments fail include that lots of the development effort at the big, established leaders:

• Is to compensate for the products’ old and now somewhat obsolete architectures.
• Is to compensate for the products’ giant-hairball natures.
• Is for high-end reliability, availability, security, and/or absolute-scalability features that most users don’t need.
• Achieves extreme generality (portability, language support, etc.) that most users don’t need.
  Is for other specialized functionality that most users don’t need.
• Suffers from “Mythical Man-Month” inefficiencies.

Industry leaders have been successfully challenged many times in the history of DBMS. As I’ve noted many times in this blog, I think it’s happening again. And transparency/portability/compatibility could well wind up being part – albeit just a part – of that general trend.

EnterpriseDB has probably passed ANTs in the DBMS plug-compability business. And taken together they’re still pretty small. Even so, plug-compatible DBMS replacement has to be taken seriously as a (possibly) emerging trend. Economically, it makes all the sense in the world.

1. How’s performance?
2. What, if any, are the compatibility gotchas?
3. How do the dollars work out?

And I must confess to not being terribly clear on the answers to any of those. Why exactly would one want to be liberated from Sybase, for example, if the price is becoming dependent on ANTs? I guess one scenario would be if you’re trying to consolidate not just DBMS brands, but actual databases. But it’s not 100% clear to me how great the benefits of that actually are.

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There actually are two prongs to ANTs’ new strategy. One of them, however, is a Big Secret that the company adamantly insists I not write about, notwithstanding that it is pretty much spelled out in this press release. The other is high-performance OLTP for specialized apps, in defense, telecom, financial trading, etc. The best way to summarize what “high-performance” means is this: When I asked what the technical sweet spot for ANTs DB, Engineering VP Rao Yendluri said “Half a million updates per second.”

The secret to ANTs’ technology is in essence radical modularity. In the past the company bragged more about its lock-free approach, but now ANTs is talking more about another feature and patent, the batching of commutative updates. Here’s how I understand that idea. In essence, ANTs DB does all of an update in memory except for the commit part, then commits in one big batch as long as what’s being committed is “commutative” – i.e., as long as the updates are independent of each other and hence can safely be made in any order. Consequently, CPU processing of an update never has to wait for disk I/O, which is a cool memory-centric approach that mainstream DBMS might do well to emulate.

Come to think of it – as I understand things, that’s also the essence of the lockless approach to transaction consistency. I.e., it’s the essence of the whole ANTs DB architecture. Nice idea. As long as performance (including, when appropriate, redos) holds up in practice, I don’t immediately see any downside to it.

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