Architect Certification and Business Impact by pengxuebo


									                                                                                           vol 8/issue 4        AUG/SEPT 2005
                                                                             A Publication of the Software Development Forum

                                                                        The Emerging Technology Connection

S T R A T E G I C    A L L I A N C E S
                                                      sponsor profile: MICROSOFT
           IBM Corporation
        Microsoft Corporation                        Architect Certification
           SAP Labs LLC
         Sun Microsystems                             and Business Impact
     The Redevelopment Agency
         of City of San Jose                 ntroducing the Microsoft                  board with previously certified architects.
                                             Certified Architect Program                  This certification is targeted to practic-
           P A R T N E R S                   Being a software developer is a hard      ing solutions architects and infrastruc-
                                         job. Take that as a given and then            ture architects who have successfully
          C A T A L Y S T S
             Accel Partners              imagine being a software or solutions         applied frameworks and methodologies
           Deloitte & Touche             architect. Not only must the architect        to create an architecture that serves the
       eBay Developers Program
                                         understand the code and its intent, but       entire IT lifecycle. These architects can
Hanson Bridgett Marcus Vlahos Rudy LLP   they must also understand the business        employ multiple technologies to solve
      New Enterprise Associates
      PayPal Developer Network
                                         problem, the interactions with other          business problems and provide business
            Sequoia Capital              applications, and the                                             metrics and measure-
            L E A D E R S                plan to ensure that                                               ments to describe the
           Agitar Software               the application can                                               success or failure of
             Alta Partners
         BA Venture Partners             be sustained and grow over time. Being        the projects they drive.
                 BISYS                   an architect is a tough job.                     For any software or services company,
             Bay Partners
               Comerica                     Strangely, however, it seems that          being able to identify great architects
     DLA Piper Rudnick Gray Cary         many individuals want to be architects,       within their own organization, as well
              El Dorado
            Ernst & Young                or at least call themselves “architects.”     as those within their customers, is an
     Garage Technology Ventures          Experienced architects and the compa-         important component for long-term suc-
   Hummer Winblad Venture Partners       nies that employ them are concerned           cess. The Microsoft Certified Architect
                 ILOG                    about the ability for anyone to have the      Program gives assurance of the quality
             Intel Capital
               NASDAQ                    architect title without having the requi-     of an individual across a wide variety of
      Norwest Venture Partners           site skills and experiences to deliver the    competencies, not just technical skills.
          Palomar Ventures
      PricewaterhouseCoopers             value that title implies. As complexity of    These competencies include leadership,
            Rustic Canyon                software and IT projects increase, this       technology depth, technology breadth,
         Sevin Rosen Funds
           Sierra Ventures
                                         becomes more and more relevant.               strategy, organization dynamics, tacti-
         Silicon Valley Bank                Recognizing this problem, Microsoft        cal/process, and communications. The
      Thelen Reid & Priest LLP
                                         and a variety of industry partners have       certified architect is well-rounded and
           Woodside Fund                 come together to create the Microsoft                              Continued on page 20
      S T A K E H O L D E R S            Certified Architect Program. This cre-
            Altos Ventures               dential recognizes the top experts in
   Panasonic Digital Concepts Center
          Red Rock Ventures              the industry, those with more than 10                     IN THIS ISSUE
          RCM Technologies               years of real experience, a unique mix        SDForum Honors Visionaries .................. 3
        Selby Venture Partners           of technical and leadership skills, and       A Matter of Security ............................... 6
             White & Lee                 the ability to address and solve real         Cfares – Member Success Story ............. 9
   I N - K I N D    P A R T N E R S      problems. Unlike other IT certifica-          Event Highlights ................................... 10
             Execustaff HR               tions, this credential was built and
        Ireland San Filippo LLP                                                        The Elusive Great
                LinkedIn                 is granted by industry architects, as         Consumer Experience ........................... 14
                 candidates must pass a rigorous review
   Wilson Sonsini Goodrich & Rosati                                                    Web Services – The Next Generation ..... 16
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2         S D F o r u m              n e w s         •      v o l      8 / i s s u e            4     •      w w w . s d f o r u m . o r g
                 event review:                8th ANNUAL VISIONARY AWARDS

                 SDForum Honors Visionaries of 2005
O        n June 15th SDForum hosted
         the Eighth Annual Visionary
         Awards at the home of Heidi
                                                                                                              He was also a member of the
                                                                                                              Advisory Council of the Stanford
                                                                                                              Graduate School of Business

                                                                                                        Photo by Frederic Arnaudie, S.F. Black and White Gallery
Roizen and David Mohler in Atherton.                                                                          Administration and on the Board
This exclusive awards celebration is held                                                                     of Trustees of Yale University.
each year to honor technology innovators                                                                      Mr. Draper now serves on the
and business leaders who continue to                                                                          boards of the Draper Richards
shape the landscape of Silicon Valley                                                                         Foundation, Atlantic Council,
through their vision, determination, and                                                                      Population Action International
leadership.                                                                                                   and the United Nations
                                                                                                              Association-USA. He is a mem-
Carol Bartz                                      Left to right: Larry Sonsini, (2000 Visionary who intro-     ber of the Council on Foreign
Chairman of the Board,                           duced Carly Fiorina), Ann Winblad (1999 Visionary who        Relations and the Pacific Council
President, and CEO                               introduced Bill Draper), Carol Bartz, Bill Draper, Carly     on International Policy. Mr.
                                                 Fiorina, Ray Ozzie, Esther Dyson (1998 Visionary who
Carol Bartz is chairman of the board,                                                                         Draper holds a Bachelor of Arts
                                                 introduced Ray Ozzie), Scott McNealy (1998 Visionary
president and CEO of Autodesk, Inc., the         who introduced Carol Bartz), Laura Merling, SDForum          degree from Yale University and
world’s leading supplier of design software      Executive Director.                                          a Master of Business degree,
and one of the biggest PC software com-                                                                       with distinction, from Harvard
panies in the world. Since Bartz took the        an honorary Doctor of Letters degree              Business School.
helm in 1992, the company has diversified        from William Woods University.                    –Introduced by Ms. Ann Winblad
its product line and grown revenues from         –Introduced by Mr. Scott McNealy
$285 million to $1.234 billion in FY05.                                                          Carly Fiorina
Bartz previously held positions at Sun           William H. Draper III                           Throughout an extraordinary career in busi-
Microsystems, most recently serving as           Managing Director,                              ness, Carly Fiorina has successfully blazed
vice president of worldwide field opera-         Draper Richards, L.P.                           new trails, taken risks and defied the odds.
tions and an executive officer of the            William H. Draper, III is Managing              As the former chairman and chief executive
company. Before joining Sun, she held            Director of Draper Richards L.P., a private     officer of global technology solutions
product line and sales management posi-          venture capital company, and Draper             provider Hewlett-Packard, she brought all
tions at Digital Equipment Corporation           International, a limited partnership that       of her skills to bear to write a new chapter
and 3M Corporation.                              makes equity investments in private com-        in the life of a historic company.
   Appointed to President Bush’s Council         panies with operations in India. A strong          After joining HP in July 1999, Fiorina
of Advisors on Science and Technology,           advocate of expanding world trade               led the reinvention of the company many
Bartz is one of a select group of industry       and the world economy, he previously            associate with the birth of Silicon Valley,
leaders expected to play a key role in           served as head of the United Nations            returning HP to its roots of innovation and
shaping and setting the government’s             Development Programme (UNDP) and                inventiveness. Fiorina successfully led HP’s
high tech agenda – ranging from R&D              as President and Chairman of the Export-        controversial merger with Compaq
funding to new broadband incentives. She         Import Bank of the United States. He was        Computer Corp., now recognized as the
also serves on the Board of Directors of         also the founder of Sutter Hill Ventures in     most successful high-tech merger in history.
BEA Systems, Cisco Systems, Network              Palo Alto, which organized and financed            In keeping with more than six decades of
Appliance, and the Foundation for the            several hundred high-technology manu-           HP corporate stewardship, and during a
National Medals of Science and                   facturing companies.                            time when corporations make up 51 of the
Technology.                                         Mr. Draper served as Chairman of the         100 largest economies in the world, Fiorina
   Bartz holds an honors degree in com-          Board of the American Conservatory              called for a new era of leadership, one in
puter science from the University of             Theatre in San Francisco, President             which corporate leaders have an opportuni-
Wisconsin. She was granted an honorary           of the Western Association of Venture           ty to redefine the role of the corporation, to
Doctor of Humane Letters degree from             Capitalists, Chairman of the Western            use profit engines to raise the capabilities,
the New Jersey Institute of Technology,          Division of the Institute of International      extend the hopes, and extinguish despair of
an honorary Doctor of Science degree             Education, and Chairman of the World            people across the globe.
from Worcester Polytechnic Institute and         Affairs Council of Northern California.                                 Continued on page 20
S D F o r u m         n e w s       •    v o l      8 / i s s u e         4     •    w w w . s d f o r u m . o r g                                                 3
                 sponsor profile:                   NASDAQ

                 NASDAQ Survey:
                 The Sarbanes-Oxley Act of 2002
O          verview
           The Sarbanes-Oxley Act of 2002
           (SOX) is one of the most signifi-
cant business reforms since the Securities
Act of 1933 and the Securities Exchange
                                                • Issuers require clarity and guidance from
                                                regulators with regard to the implementa-
                                                tion of the new law; too much ambiguity
                                                around the implementation of the law has
                                                pushed auditors to be overly conservative.
                                                                                                   adequate and that financial conditions of
                                                                                                   companies are adequately revealed.

                                                                                                   • 70% of respondents believe that the
                                                                                                   accounting industry does not have suffi-
Act of 1934. SOX contains many corpo-                                                              ciently trained staff for the 404 work, and
rate governance reforms that are aimed to         – Regulatory bodies have not been clear          61% do not believe that the accounting
promote enhanced corporate governance,            on definitions and scope. Guidance to            industry was qualified to certify.
be cost effective, and reduce financial           companies and auditors has been too
fraud.                                            top level.                                       By the Numbers
   As the listing venue for over 3,000                                                             • NASDAQ Issuers spent an average of
companies, NASDAQ surveyed its issuers            – The Act requires that all companies              $1.1 million on 404 implementation
to learn more about the impact SOX                adhere to the same standards of control;           costs.1
was having upon our issuers. We sent              however, auditors were initially unclear
two surveys to 3,053 issuers, the first           as to definitions and scope and erred on         • NASDAQ Issuers in total spent
received more than 454 responses and the          the side of conservatism. The “Big 4”              an estimated $3.5 billion on 404
second follow-on survey received 321              accounting firms did not have agree-               implementation costs.2
responses. On both surveys, 70% of the            ment on clear standards so they tried to
respondents were either the CEO or                “out-do” each other in terms of what             • For each revenue category, NASDAQ
the CFO of the company. Responses                 they required companies to do in order             issuers had 404 costs (both the external
in the survey were representative of the          to be safe.                                        and internal) that are 2.5 times more
NASDAQ population as a whole.                                                                        than their financial audit costs.3
   We believe it is of key importance to          – The scope of implementation evolved
provide this vehicle for our listed compa-        with time. Early implementers paved the          • As a percent of revenue, smaller issuers
nies to express their views and have their        way, but at a huge price.                          spent approximately 11 times more than
voices heard in ongoing discussions                                                                  larger companies.4
around this Act. In addition, NASDAQ is           – COSO (the “Committee of
striving to ensure that vigorous corporate        Sponsoring Organizations,” a voluntary           • 90% of NASDAQ issuers who
governance policies are maintained and            private sector organization dedicated to           responded to the survey believe their
that clear standards effectuating those           improving the quality of financial                 audit costs have permanently increased.
policies are provided to companies. In this       reporting) became the de facto 404
regard, these surveys were designed to            implementation framework. Not adapt-             Benefits and Effectiveness
learn from issuers’ initial compliance            ing the framework to companies with              One of the stated goals of SOX was to
efforts, to discover how the regulations          varying degrees of complexity and size           assure investors that financial controls are
implementing SOX worked, to assess how            put excessive obligations and control            adequate and internal processes accurately
the audit practitioners performed and to          requirements on smaller companies.               reveal the financial condition of the com-
share these learning’s with our companies                                                          pany. 58% of the NASDAQ issuers who
and their legislators.                            – Supply and demand drove up the price           responded to the survey believe that their
                                                  of auditors and other service firms.             audit with 33% stating that their disclo-
Summary Findings                                  Companies wanted top tier opinions for           sures will improve and almost a third
• 74% of respondents believe the                  their first attestation.                         believing that investor confidence will be
Sarbanes-Oxley Act was necessary.                                                                  restored.
                                                • 58% of companies believe the top bene-              We also asked what issuers believe
• The law is not at issue; the implementa-      fit from a 404 implementation is increased         would be the positive long-term outcome
tion costs associated with Section 404 of       audit controls, which support the SOX              or value achieved as a result of this Act.
the Act are the issue.                          goal of assuring investors that controls are                             Continued on page five

4              S D F o r u m          n e w s      •     v o l     8 / i s s u e         4     •      w w w . s d f o r u m . o r g
Continued from page four                             Costs                                          first-year final 404 implementation costs,
Some positive outcome answers included:              While this survey focused on the entire        both externally with auditors as well as
• Better disclosure and continuous                   Sarbanes-Oxley Act, the majority of the        internally assigned resources. We surveyed
   improvement                                       answers received centered on Section 404.      3,053 companies and received 321
• Improved financial reporting                       Cost was the main issue and the higher-        responses. Again, most of the respondents
• Leveraging IT processes, documentation,            than-expected cost theme ran virtually         were either the CEO or the CFO of the
   and control                                       through all the answers. All aspects of        company.
• Updated policies and procedures manuals            costs – audit, consulting, legal or compli-       Much of the complaint around costs is
• Stiffer penalties for criminal acts                ance costs, in addition to opportunity         that smaller companies bear a relatively
• Board of Directors more active with the            costs of diverted management focus from        larger share of the burden. As a percent
   company                                           running their core business or board focus     of revenue, companies that have revenues
• Audit committee much more integral                 from giving strategic guidance – were          less than $100 million spent 11 times
   to the operations of the company                  mentioned. Responses identified SOX            more than companies with revenues $2
• Whistleblowers more prevalent                      deficiencies in terms of its effectiveness.    billion or more.
• Increased investor confidence                      • Costs clearly outweigh the benefits             Many stated that their budgets
• Possible long-term help to smaller                 • Cannot legislate morality                    increased several fold during the imple-
   companies                                         • Little of the well-intentioned legislative   mentation or that they wished they had
• Many who were pessimistic thought that                intent was accomplished                     delayed the implementation to allow
   over time they might see benefit                  • All five of the benefits listed in the       clearer definitions in SOX 404 compliance
   However, when companies were asked if                question are worth < 10% of the costs.      to unfold.
SOX achieved its goal of holding all public          • 404 is form over substance
companies to the same ethical governance                                                            Costs per Company
and financial reporting standards, 54% of            Second Survey Looks at Costs                   • The average cost per company to
the respondents don’t believe this would be          Because of the cost-centric concerns,            implement SOX is just over one
effective and 30% are in the middle. Most            NASDAQ fielded a second survey focused           million dollars.5
of the responses indicated that ethics can           exclusively on the direct and indirect costs   • Extrapolated to NASDAQ issuers
not be legislated or that it is still too early      incurred by companies. The 404 Cost              in total, a conservative estimate is
to tell if SOX will be effective.                    survey was designed to learn our issuers’        $3.5 billion.6      Continued on page 21

                                                  HANSON & BRIDGETT AD
                                                    (printer to paste-up)

 S D F o r u m           n e w s       •     v o l      8 / i s s u e          4     •    w w w . s d f o r u m . o r g                      5
                 streetwise:               PricewaterhouseCoopers

                 A Matter of Security
I   nvestment in all subsectors of software
    has declined with the exception of
    security, which was up 46 percent
from 2000 figures. Compare this to
eCommerce or Services for Internet, for
                                                high growth rate sector and it’s an area in
                                                which we will continue to invest. Because
                                                threats continuously evolve, technology
                                                continuously needs to evolve as well.
                                                However,” she notes, “right now there
                                                                                                  Patch management. No one believes that
                                                                                                  worms have gone away and the rate of
                                                                                                  exposure to all levels of the organization
                                                                                                  is extremely high. With experts discussing
                                                                                                  the very real possibility of a Zero day
example, which were both down by 91             is a lot of hype around security and there        exploit, where patches are not available
percent or business process outsourcing,        are too many dollars going into it. It’s          before an exploit is unleashed, the
down by 92 percent, and a high-stakes           easy to make an investment that becomes           concept of “defense in depth” has
story unfolds.                                  obscured by the multitudes of other               never been as meaningful.
   How much money are we talking                companies that are out there. You can
about? Cumulatively, security-related           look at other areas that have garnered            Identity management, authentication,
investment across all VC sectors was $3.1       a lot of investment over a short period           and authorization. “While there are
billion, with the software sector receiving     of time, such as communications or the            some robust solutions in the marketplace
$2.5 billion, or 80 percent. What is driv-      Internet, and you could argue we’re in            today, there are still only a small number
ing the awareness of security products and      a security bubble right now.”                     of organizations that have managed to
increasing demand for them?                        Despite the many companies in the              successfully implement this in a consistent,
   “Primarily, and in order of impact,          security marketplace providing innovative         secure, and efficient way, primarily
regulatory requirements, such as manda-         point solutions, Bolton notes: “We’re still       because it’s such a hard problem to
tory compliance with Sarbanes-Oxley for         missing the complete envelope to get our          solve,” says Bolton. “Legislation like
public companies; increasing privacy            arms around the distributed environment           Sarbanes-Oxley, has really caused organi-
regulations that have security compo-           and a way to make sure that the enterprise        zations to focus on the business need to
nents; and an awareness that privacy legis-     is protected and data is protected wherev-        understand which employees need access
lation beginning to hit Congress is more        er it goes – onto laptops and remote com-         to what information, how you control
likely than not to become law. In combi-        puting devices, across the Internet, or to        that access, and how you achieve effective
nation, these factors are driving a trend to    third-party vendors that perform services         segregation of duties across multiple
focus security into the operations layer of     on behalf of the enterprise.”                     enterprise systems.
the enterprise, making real-time security          Among the technology solutions                    “Software is needed to automate
monitoring, reporting, and risk manage-         Bolton sees being explored most often             security processes to help make them
ment a significant factor in defining the       by corporate computer users includes              effective on an enterprise scale,” says
parameters of the evolving security             the following:                                    Bolton. “Consider the technology intru-
marketplace,” says Jay Bolton, a partner                                                          sion detection systems that throw out an
with PricewaterhouseCoopers’ Security           Encryption, which scrambles information           overwhelming amount of data rather than
Practice in San Francisco.                      and makes it theoretically impossible             organize it according to rules that help
   Andrea Kaufman, a partner at Novak           for people who don’t know how to                  call attention to important activities. And,
Biddle Venture Partners in Bethesda,            unscramble it to get the information              anything that would help companies
Maryland, which has a history of security       even if it is accidentally disclosed.             address identity management – especially
investing, agrees and observes that the            “Organizations entrusted with                  the ability to help in defining roles, such
need to protect the corporate crown             personally identifiable information have          as determining what specific information
jewels is becoming more widely under-           a vested interest in making sure it is not        an accounts payable clerk should be
stood, particularly in the wake of wide-        vulnerable to the targeted attacks on such        allowed to have – would be of interest.
spread damage and enormous cost around          information that we are beginning to              Today that’s a time-consuming, manual
security breeches now featured in the           see,” he explains. “Encryption is some-           process. Maybe the future of this is some
media. As more organizations collaborate        thing that people are increasingly looking        combination of artificial intelligence meets
across enterprises, security is necessary to    at to protect laptops, desktops, portable         rule-based security controls that allow the
protect the data that is being shared.          computing devices – places where you              organization to monitor common access
   “Security usually falls within the top       may have shadow copies of sensitive pieces        patterns, establish baseline for typical
three priorities for CIOs,” says Kaufman.       of information that was historically under        access requirements, allow business
“We’ve seen that it continues to be a very      the control of IT professionals in the data                           Continued on page seven
6              S D F o r u m          n e w s      •    v o l     8 / i s s u e         4     •      w w w . s d f o r u m . o r g
Continued from page six
owners to validate those patterns, and
then call attention to anomalous activities,
for example flag transactions that adminis-                                      Emerging Technologies
trators might want to take a look at
because they were outside of the normal                                               Showcase
access patterns or had a high risk profile.
This is being done today through highly
                                                                                    CALL FOR PAPERS
manual, costly processes.”
                                                             SDForum’s Emerging Technologies Showcase is a semi-annual
   Novak Biddle seeks investments that                 competition that highlights technologies developed by SDForum member
deliver true business ROI, such as                   companies. Industry leaders and venture capitalists review, rate, and award
automation and cost savings. One of its              participation to those companies with the top scoring executive summaries.
New York City-based portfolio companies,
Counterstorm, is building an anti-worm                                Apply today to present at the
product using advanced data mining                              SDForum Emerging Technologies Showcase.
                                                         This is an incredible opportunity to get visibility and feedback from
techniques and anomaly detection to help
                                                       over 30 investors. Maybe you will be the next SDForum success story!
companies keep a step ahead of threats.
   “The software doesn’t need to know                                              ◆◆◆◆◆◆◆◆◆◆
what a new worm looks like; it infers it
based on behavior that looks abnormal                                             Why Showcase?
compared to a baseline it sets,” says                    • Your executive summary will be reviewed by 3-5 top tier investors
                                                           as part of the application process.
Kaufman. “After it detects the worm,
                                                         • All participants receive written feedback from the reviewers.
it stops it from propagating and doing
                                                         • If selected, your company will get valuable face-to-face time
damage within seconds. Other products                      at a private pitch and meeting session with over 40 investors.
on the market rely on knowing what the                   • SDForum and our partners provide each accepted company with
worm looks like in advance.”                               at least one hour of coaching.
   “Typically, we like to invest around the
edges; not where the crowd is,” adds                                               ◆◆◆◆◆◆◆◆◆◆
Kaufman. “We’ll invest in companies that
                                                                   THE FOLLOWING CATEGORIES ARE AREAS OF INTEREST
have the [U.S.] government as their initial                                 EXPRESSED BY OUR SPONSORS:
market and look to take the product and              (Their interest is not limited to these categories so please submit all entries.)
deliver it to a broader initial market.”
   Examples of current innovative                                                Semantic Technologies
technology investments that meet Novak                                         Storage/Data Management
Biddle’s criteria include:                                                          Social Networking
                                                                                  Digital Entertainment
                                                                          Wireless/Consumer/Content Services
Intelli7, a Washington, DC-based
                                                                                  Software as a Service
company that Kaufman says uses a new                                                     Security
paradigm for security by using traffic
analysis to stop unwanted behavior on                                              ◆◆◆◆◆◆◆◆◆◆
a network. “It looks at all seven layers
of a network and allows the customer to
                                                               Application Deadline: Friday, October 21st at 12:00pm
define which activities can take place
                                                        Top VC firms will review executive summaries and the highest scoring
rather than trying to look at all the poten-                  companies will be invited to participate. Space is limited.
tial attacks and malicious behavior that                 VC’s include Accel, Greylock, Hummer Winblad Venture Partners, NEA,
could occur,” she explains. “It reduces the                     Norwest Venture Partners, Sequoia, and many others.
amount of data that you need to under-
stand because you can limit the amount of                                          ◆◆◆◆◆◆◆◆◆◆
traffic on the network to specific applica-
                                                                                Date: December 1, 2005
tions. For example, it could disallow all
music file sharing traffic, through which           Details for eligibility, registration & fees can be found on the application page:
many viruses, worms, and other attacks                             
are facilitated.”     Continued on page 22

S D F o r u m          n e w s       •    v o l   8 / i s s u e       4     •     w w w . s d f o r u m . o r g                          7
                  volunteer spotlight:                       DAVID NIELSEN
                  Interviewed by Barbara Cass

D        ave, you started the Web Services
         SIG in May 2001 and joined the
         Executive Council last year.

How has the Web Services industry changed
                                                 Services SIG has had surprising longevity.
                                                 Today, with companies like PayPal, eBay,
                                                 Amazon, Google and Yahoo exposing
                                                 their own Web Services, we spend less
                                                 time explaining and more time exploring
                                                                                                  need to implement these new Web Services.

                                                                                                  Has your volunteer work with SDForum in
                                                                                                  anyway provided a stimulus for writing your
                                                                                                  book which has recently been published?
since 2001 and can you predict its future?       innovative uses and integration scenarios
                                                 that best work with SOAP or even other           DAVID: The idea to write PayPal Hacks
DAVID NIELSEN:                                   data exchange techniques like REST and           was inspired by my previous manager
                       By early 2001, the        RSS.                                             Dave McClure, now at SimplyHired, who
                       Internet bubble had                                                        offered me the PayPal job while at an
                       burst. Tech entrepre-     What do you do in your “real” job?               SDForum event. Dave and I have known
                       neurs were looking                                                         each other for years, ever since he started
                       for the ‘next big         DAVID: As Manager of the PayPal                  the SDForum eCommerce SIG back in
                       thing’ and Web            Developer Network (,          1997.
                       Services fit the bill.    I support over 300,000 3rd-party devel-
                       We had huge turn-         opers who are building ecommerce appli-          What do you like to do in your spare time?
outs at first, and it was a complicated          cations on top of our PayPal Payments
topic so we spent most of our first year         Platform. PayPal just launched its new           DAVID: I’m a part-time triathlete, which
explaining what SOAP-based Web                   Website Payments Pro which includes              means I squeeze in a couple workouts each
Services were and how they were different        new Express Checkout and Direct                  week, though most of my time is really split
from raw XML or more traditional ‘web            Payment APIs. We just held our annual            between PayPal and preparing for the wed-
services’ like Hotmail or Evite. The hype        Developer Conference where we intro-             ding Erika and I are planning which takes
eventually died down, but the Web                duced developers to the resources they           place in October.

                                  New RFID SIG Started in June!
                                                                      Topics include but are not limited to:
             Our goal is to promote the emerging RFID                 ■ Passive and active ID tags and
            technology, foster understanding, and build                  their related readers
              relationships within the industry and the               ■ Location Based Services (LBS)
              public. The group plans to deliver, within              ■ Application Infrastructure (servers and network)
            the framework of a Special Interest Group,                ■ Asset control and management
            education, information, and networking via                ■ Supply Chain Management (SCM)
               technology domain briefings, seminars,                 ■ Warehouse Management System (WMS)
                and monthly meetings in Silicon Valley                ■ Customer Relation Management (CRM)
              locations. We cover the RFID technology                 ■ Enterprise Resource Planning (ERP)
              arena from passive to active UWB, from                  ■ Logistics, Data Mining
             access control to retail apps, and issues                ■ Homeland Security related issues
              from application design to data security,               ■ Hardware and software design,
                       protection, and privacy.                          including Bluetooth, WiFi, UWB
                  The inaugural meeting had over 80 attendees – we hope to see you at the next meeting.
               Please check our website for dates and time. The RFID SIG will be meeting at Pillsbury Winthrop in Palo Alto.

8              S D F o r u m           n e w s      •    v o l     8 / i s s u e         4    •      w w w . s d f o r u m . o r g
                  Noël’s product management corner – MEMBER SUCCESS STORY
                  Cfares – Making Sense Out of Chaos and
                  Delivering Added-Value in the Process
C         fares is a company with a value
          proposition that is so clear and so
          easily identifiable that it sounds
almost too good to be true. But it is true
– the founders of Cfares have taken a task
                                                   search database. Then they apply Dynamic
                                                   Pricing Engine (DPE) technology to the
                                                   process. By combining the power of a
                                                   comprehensive air-travel search engine with
                                                   a unique Point of Sale Dynamic Pricing
                                                                                                    the site is not just a search engine, but a
                                                                                                    dynamic pricing tool Cfares has a lot of
                                                                                                    opportunity to make money. The airline
                                                                                                    pays a portion of the fare when Cfares
                                                                                                    delivers a customer. Additionally the
that millions of people do-booking online          Engine (DPE), Cfares not only empowers           company has advertisers, affiliate programs,
travel – and have not only made it easier,         consumers to compare prices across travel        and a premier membership program for
but loaded in value for both the customer          sites, but also ensures that they will be        consumers. For now customers can visit
and the supplier. Here’s how Cfares is             delivered the lowest price, a price that to search for the best air-
revolutionizing the online travel market.          would not otherwise have been available          line prices. In the future the company will
                                                   had they used a travel site other than           add hotel and other travel related products
The Market Opportunity                             Cfares. Based on the Cfares meta search          and services. Eventually you can expect to
According to Forrester, customers spent            engine results, the DPE generates a new          see Cfares on many partner sites, similar to
$52 billion in Internet travel spending in         set of prices at the Point of Sale that do       the “powered by Google” model.
2004. Travel is one of the largest sales           not exist anywhere else on the web,
categories in online commerce. The                 including the airline supplier’s own web         Why It Will Work –
category accounted for 40% of the total            site, giving the consumer the lowest possi-      The Strength of the Team
Internet sales volume in 2004 and is               ble price and the airline a sale that would      The founders of Cfares are pioneers in the
projected to be $75B by 2006. (Source:             have been lost to a competitor.                  travel industry. The founder has started a
Forrester Research 2004). Not surprising-             The DPE technology is the key to the          total of six companies in the travel technol-
ly with such a market opportunity there            true value. At the heart of the DPE tech-        ogy space. He and his other executives
are hundreds of travel sites. But this has         nology is a sophisticated rules engine based     were some of the first to work on the Sabre
led to confusion and a headache for the            on routes, historical pricing, competitive       systems, the primary infrastructure to the
consumer. For any given itinerary there            fares, vacant status, frequent flyer points      airline ticketing system. They have since
can be a wide price variation across sites.        and other variables. Airlines can select         developed many new technologies including
In addition, none of these sites has access        their requirements for each parameter. By        an ATM self-service ticketing product and a
to many of the low-cost carriers like              allowing its partnered suppliers to change       patent in self-booking. These are not new
Southwest or JetBlue. Customers often              prices at the point of sale, after viewing the   kids on the travel block. With a combined
search several sites and still wind up not         competitor’s prices through the Cfares           50 years of deep domain knowledge in
finding the lowest price. Or, many cus-            meta search engine, Cfares gives the part-       travel industry, they understand the value
tomers search only the one site that they          nered suppliers an unfair advantage in the       proposition. See for yourself. Visit
believe to have the lowest fares, leaving          marketplace. The value to the airline?  to book your next trip.
themselves at a disadvantage. And the              Unsold inventory costs airlines $30 billion
                                                                                                    Company Information: Cfares, Inc.
suppliers, the airlines, often lose a sale         a year. Airlines break even at an average of
                                                                                                    2000 Alameda de Las Pulgas, Suite 159
because of a few dollars difference in price.      65-70% capacity (Source: Air Transport           San Mateo, CA 94403; TEL: 650-377-0500
                                                   Association). Cfares estimates that it helps     Vajid Jafri, Chairman & CEO;
Cfares – The Solution to the Pain Point            its partnered airlines sell an additional 5%
What’s the answer? Most Internet travel            of its airline seats, resulting in incremental   Noël Adams is President of Phase Forward
sites layered a pretty front end on top of         revenue that can take an airline supplier        ( Phase Forward is a
the old airline infrastructure. Cfares set         from a “loss” to a “profitable” position.        product management and product marketing
out to instead change the whole infrastruc-        Cfares has a patent filed on the DPE tech-       firm in San Francisco that executes projects
ture. First Cfares creates one point of            nology. The law firm they are working            along the product lifecycle from new product
access for all Internet travel search includ-      with is so impressed with the patent that        research and market analysis to writing prod-
ing the airline suppliers, discount airlines,      they invested in the company.                    uct requirements to outbound product mar-
and the private wholesalers, combining                                                              keting and product launch. Phase Forward
legacy airline systems, Internet only sites        The Business Model                               team members also deliver seminars and
and brick and mortar wholesalers into one          So, how do they make money? Because              coaching on a variety of new product topics.
S D F o r u m          n e w s        •    v o l       8 / i s s u e          4    •     w w w . s d f o r u m . o r g                         9
                   event highlights

■ PMI Silicon Valley Tools and                     to work in a different way to that currently        successfully navigating data migration devel-
Techniques Forum: XPROCESS                         defined in the process they can do so.              opment and execution with examples from
XProcess is a process improvement environ-         Comparing the actual performance of                 a recent complex data migration project.
ment created to unify agile planning, project      episodes with the defined way allows for            • How to reduce development time
execution, and process improvement across          audit of the process and most importantly              and costs
the enterprise.                                    for capture of new and better ways to               • Design and development strategies
                                                   approach problems.                                  • Automating data migration processes
XProcess is designed to help you ...                                                                   • When and how to use ETL tools (Extract,
• define your processes                            XProcess Architecture and Interfaces                   Transform, Load)
• plan your projects based on your                 XProcess is built on a server-based service         • Data validation testing techniques
  processes                                        oriented architecture (SOA) and is delivered
• perform your projects with live updates          with a rich-internet application (RIA) Flash        Location: SDForum, San Jose
  to planning and process information              client. This requires no special installation       Date: September 14th
• improve your processes throughout                on the client machine as it is effectively          Time: 12:00 noon – 1:30 pm
  projects and on their completion.                loaded by accessing the server through a            Price*: (Refreshments included; NOT
                                                   browser. An Eclipse client is also provided.        lunch, please bring your own!)
Process Defining                                   XProcess’s architecture allows integration          $10 for PMI & SDForum members;
Defining and modifying a process in                with a wide range of other tools including          $20 non-members
XProcess is straightforward and is based           IDE’s, mobile devices, planning tools (e.g.         (*at the door add $5 to member and
on frequently occurring task patterns, or          Microsoft Project, Niku) and configuration          non-member prices)
“episodes,” along with the artifacts (deliver-     management tools.
ables), roles and gateways (quality checks)
that these tasks use. Typical episodes             Location: SDForum, San Jose                         ■ Web Based Architectures:
include defining and developing a new              Date: August 10th                                   Where do we go from here?
requirement, handling a bug report, releas-        Time: 12:00 noon – 1:30 pm                          Software architecture is getting a lot of
ing a build, or developing a business case.        Price*: (Refreshments included; NOT                 attention and architecture for the Web is
                                                   lunch, please bring your own!)                      on the march again. New technologies and
Project Planning                                   $10 for PMI & SDForum members;                      approaches are providing new solutions —
Planning a project based on your process           $20 non-members                                     and new challenges. Traditional enterprise
starts with the “New Project Wizard” in            (*at the door add $5 to member and                  vendors are driving some of this change,
XProcess which, with a relatively small            non-member prices)                                  but leading web based companies are
amount of information about your project,                                                              playing a critical and equal role in defining
automatically creates the base project plan.                                                           the landscape. Join SDForum to share case
Each task in your project has a default            ■ PMI Silicon Valley Tools and                      studies, design patterns, best practices,
range for estimates applied, but starting          Techniques Forum:                                   and lessons learned from web designers
with the highest priority tasks you can now        Successfully Navigating                             and architects, along with insights from
enter more accurate “3 point estimates.”           Data Migration                                      industry thought leaders. To learn more
The 3 point estimates determine Best Case,                                                             visit:
                                                   Speaker: Rand Bradley
Most Likely and Worst Case effort required
for each task.                                     Data Migration is often one of the most dif-        Location: Parc, Palo Alto
                                                   ficult and complex parts of a software imple-       Date: September 14th
Project Performing                                 mentation. Poor data management, unclean            Time: 9:00 am – 1:45 pm
As you and other team members perform              data, and lack of data migration experience         Price*: $25 SDForum Members;
activity on your project, XProcess provides        all add to complexity. Learn how to address         $35 Non-members
important facilities for guiding your activity     the project management complexities of              (*at the door add $10 to member and
and for you to feed back progress easily           relying on software vendors and contractors         non-member prices)
and unobtrusively. Each participant on             for architecting, developing and executing
a XProcess project has responsibility              the migration. Understand how to manage
for their own planning and process. They           these difficult and complex issues proactive-       ■ Founders Forum Brown Bag
have access to the estimates, dates, and           ly to increase project success and reduce           Series with Mitchell Kertzman
priorities and so can update these as soon         project risk.                                       Mitchell Kertzman, Partner,
as better information is available.                                                                    Hummer Winblad Venture Partners
                                                   This talk presents a high-level overview            Founder, Powersoft (acquired by Sybase) and
Process Improving                                  for project managers and project leaders            former CEO of Sybase Inc, and Liberate
XProcess provides flexible process guid-           on key issues related to data migration
ance, which means when participants want           projects. Attendees will learn strategies for                             Continued on page 11

10              S D F o r u m            n e w s      •     v o l      8 / i s s u e          4    •      w w w . s d f o r u m . o r g
                  event highlights

Continued from page 10                             Hummer Winblad Venture Partners. These          ■ The New Rules of the Road
                                                   meetings are designed to help founders          for High Performing ISVs
About The Series:                                  and CEO’s of early stage companies identify     Competition gets tougher every day and
The Founders Forum Brown Bag series                partnerships, provide industry insight and      the pressure on margins in the software
helps new and seasoned entrepreneurs               perspective, and help with tactical ideas       business continues to rise. So what are
learn from the experience, focus, and vision       and contacts.                                   the strategies available to today’s software
of recognized founders and industry execu-                                                         companies? The bestselling book, “The
tives. Mitchell Kertzman will share his expe-      This is not perceived as a funding exercise,    Discipline of Market Leaders” gives
riences and key lessons learned from by            more a discussion session that promises         companies three choices:
the founder of Powersoft to getting acquired       to be a good use of your time. They are         • Achieve Operational Excellence
by Sybase and taking over the helm, to             looking to have an interactive conversation     • Maintain Product Leadership
Liberate and now his role as a partner at          with 10 companies. Hummer Winblad               • Create Customer Intimacy
Hummer Winblad Venture Partners.                   Venture partners believes they can provide
                                                   the best insight to software companies          Choosing to excel in one of these disci-
About the Presenter:                               seeking their first round of institutional      plines must be based on an evaluation
Mitchell Kertzman is a Partner at Hummer           funding. If you are an entrepreneur with an     of what each company believes is core to
Winblad Venture Partners. He has over 30           idea or a CEO of an early stage company,        their success. Increasingly in the software
years of experience as a CEO of public and         please submit a one-page summary of your        industry the winners are those who under-
private software companies. Most recently,         business for selection. Accepted compa-         stand the customers’ needs, market their
Mitchell was Chairman and CEO of Liberate          nies will be notified one week prior.           solution effectively and develop trust-based
Technologies, a provider of platform soft-         Send a one page executive summary to            relationships with them. However, a focus
ware for the delivery of digital services by                              on customer intimacy cannot totally eclipse
cable television companies. Before joining                                                         either of the other two disciplines.
Liberate, he was chairman of the board and         In 1989 John Hummer and Ann Winblad
CEO of Sybase, Inc. Mitchell was founder           formed Hummer Winblad Venture Partners,         Leading software companies VerticalNet
and CEO of Powersoft, which merged with            the first venture capital fund focused exclu-   and AutoDesk will describe how they are
Sybase in February 1995.                           sively on software companies. Although the      balancing core and context by leveraging
                                                   software industry was then in its infancy,      offshore development resources to enhance
A former programmer, Mitchell founded              John and Ann held two convictions that          operations and reduce costs so they can
Powersoft in 1974 as Computer Solutions.           continue to drive the firm’s thought process    increase focus on the customer. Microsoft
He renamed the company and became a                today. First, they believed that software       will speak about new developments in tech-
member of the Hummer Winblad family in             companies enjoy a simple but superior           nology that can help software companies
1991 when Hummer Winblad invested in               economic model based on the low variable        maintain product leadership.
the company, which became the leading              cost of production. Second, they felt that
provider of client-server development tools        software would have a dramatic effect on        Join SDForum as we discuss the trends
with its flagship product, PowerBuilder. The       how we live, work, and play. This vision has    that are shaping the software industry and
merger with Sybase in 1995 was, at the             become reality; software has grown into         how to address the challenges that lie
time, the most valuable in the history of the      one of the largest industries in the United     ahead.
software industry.                                 Stages. Despite this remarkable growth,
                                                   they believe that software’s future has only    This program is for C-level and Senior
Event Sponsor: Ernst &Young LLP
                                                   just begun.                                     Executives within emerging technology
Location: SDForum, San Jose                                                                        companies and larger independent
Date: September 15th                               How to apply: Please email one page             software vendors as well.
Time: 12:00 noon – 2:00 pm                         executive summary to
Price*: $15 SDForum Members;                                                                       Brought to you by: Microsoft, Symphony
$30 Non-members                                    Deadline to apply: Please submit                Services, and Autodesk
(*at the door add $10 to member and                one page summary by 5:00pm,
non-member prices)                                 Tuesday, September 6th.                         Location: DLA Piper Rudnick Gray Cary,
                                                                                                   East Palo Alto
                                                   Location: SDForum, San Jose                     Date: September 28th
■ Coaching Session with Hummer                     Date: September 20th                            Time: 9:00 am – 12:00 noon
Winblad Venture Partners                           Time: 9:00 am – 12:00 noon                      Price*: $25 SDForum Members;
SDForum is hosting a unique series of one-         Price: Free SDForum Members;                    $40 Non-members
on-one executive coaching meetings with            $35 Non-members                                 (*at the door add $10 to member and
                                                                                                   non-member prices)

S D F o r u m          n e w s        •    v o l       8 / i s s u e          4    •     w w w . s d f o r u m . o r g                        11
                   SDForum SPECIAL INTEREST GROUPS (SIGs)

                                                           NEW SIGs ARE FORMING
                                                              Check website for details:                       Software Engineering Management. The
     Special Interest Groups (SIGs)                                                                            Software Engineering Management SIG is a
        are informal evening meetings                          Business Collaboration                          forum for discussing new ways for engineering
         held on a monthly basis and                                and Search
                                                                                                               (principally, software development) managers
     organized around a specific business                                                                      to improve their effectiveness by providing a
        or technical area of interest to            Marketing. Success or failure of companies,                deeper understanding of the process, person-
     software and Internet professionals.           including technology companies, is often deter-            nel, organizational, and technical aspects of the
         Please always check our                    mined by the quality of their marketing. This SIG          software development environment in today’s
      website for the latest information            helps people learn how to better position, brand           economy. Check website for details of next
        before attending a meeting.                 and promote products and services. Meets                   meeting. Contact Chairs: Stephen McHenry and
      There is typically no charge for              second Monday of the month, 6:00 PM at the                 Steve Mezak
 SDForum Members, $15 for Non-Members.              SDForum offices, San Jose. Contact Chairs: Jim
                                                    Schibler & Tammo Stubbe                Software As A Service. The SaaS SIG will
                                                                                                               present thought leadership and practical
Business Intelligence. Provides a forum for dis-    Multimodal Interactive. This SIG was created to            execution strategies for current and future
cussing the growing opportunities software pro-     establish and support a community of software              SaaS entrepreneurs, investors, developers and
vides to use information to improve business        developers interested in creating wireless                 industry executives. Meets each month (check
management practices. Meets third Tuesday of        and voice based web applications. Monthly                  our website for exact dates) at 5:30 PM at DLA
the month, 6:30 PM at Cubberley Community           meetings serve to provide technical insight into           Piper Rudnick Gray Cary, 2000 University Ave.,
Center, 4000 Middlefield Rd., Rm. H-1, Palo Alto.   the rapidly emerging technologies, as well as to           E. Palo Alto. Contact Chairs: John Koenig and
Contact Chairs: Paul O’Rorke and Richard Taylor     provide an environment in which attendees                  Stacey Curry Bishop Sponsored by Microsoft.           can network with each other. Meets first                   Sponsored by IBM.
                                                    Thursday of the month, 6:30 PM at Openwave,
Emerging Technologies. A forum to discover and      Seaport Boulevard, Redwood City. Contact Chair:            Venture Finance. This SIG will help you practice
discuss the most recent developments in tech-       Joe Jasin                          your pitch and presentation and get feedback
nology, how these technologies affect us, and       Sponsored by Microsoft.                                    from VCs and entrepreneurs who have talked
how we can define business models around                                                                       the talk and walked the walk. Meets third
these technologies. Meets second Tuesday of         Open Source. This SIG provides a forum for IT              Wednesday of the month, 6:30 PM at DLA Piper
the month, 7:00 PM at Cubberley Community           executives, business strategists, marketers,               Rudnick Gray Cary, 2000 University Ave, E. Palo
Center, 4000 Middlefield Rd., Rm. H-1, Palo Alto,   investors and advisors to discuss Open Source              Alto. Contact Chairs: Steven Bennet, Tom
Contact Chairs: Janice Carter, Bill Grosso and      issues, and achieve clarity and predictability             Cervantez and Phil Korn
Tom Hill Sponsored by El          regarding the commercial, legal and investment             Sponsored by Microsoft, Pricewaterhouse-
Dorado and IBM.                                     implications of open source software. Meets                Coopers, Silicon Valley Bank, and White & Lee
                                                    each month (check our website for exact dates)             LLP (NOTE: COST TO ATTEND THIS SIG; $20 MEMBERS;
Founder’s Forum. Helps new and seasoned             at 5:30 PM at DLA Piper Rudnick Gray Cary,                 $30 NON-MEMBERS).
entrepreneurs learn from each others experi-        2000 University Ave., E. Palo Alto. Contact
ence, enthusiasm, focus and vision. Meets first     Chairs: Andrew Aitken and John Koenig                      Web Services. Web Services allow program-
Tuesday of the month, 6:00 PM at SDForum, San                                       mers to write code that can be used by other
Jose, Contact Chairs: Omar Baig, Nancy Tubbs,                                                                  programmers written in any language, on any
and Chris Yeh                     Security. Fills the need for developers to get first       operating system, running on any hardware plat-
                                                    hand information about security products, tech-            form over the Internet. Mildly put, Web Services
International Software. This SIG is the interna-    nologies, and processes, and to exchange infor-            represents a revolution in the business model
tional arm of the SDForum, connecting global        mation on current practices and encountered                of e-commerce. Meets fourth Tuesday of the
and technology communities with Silicon Valley.     threats. Meets fourth Thursday of the month at             month, 6:30 PM, eBay Silicon Valley Conference
Meets third Monday of the month, 6:30 PM at         Cubberley Community Center, 4000 Middlefield               Center, San Jose. Contact Chairs: Frank
Bingham McCutchen, 1900 University Ave, E.          Rd., Rm. H-1. Contact Chairs: Ames Cornish and             Cohen & David Nielsen
Palo Alto. Contact Chairs: Jeannine Athas and       Ira Victor Sponsored               Sponsored by eBay Developers Program, IBM,
Alex Sousa                       by Sierra Ventures.                                        Microsoft, and PayPal Developer Network.

Java. Gives developers a chance to interact         Software Architecture & Modeling (SAM). This               Windows. An open forum for collecting and dis-
with and learn from other Java developers.          SIG focuses on two main areas: the roles and               seminating technical information on program-
Presentations cover significant products or tech-   responsibilities of the software architect and             ming Microsoft Windows. Technical panels,
nologies of interest. Meets first Tuesday of the    related functions; and technical matters                   presentations by experts, and previews of new
month, 6:30 PM at Cubberley Community Center,       of interest to the architect/abstractionist/               development tools by company representatives
4000 Middlefield Rd., Rm. H-1, Palo Alto.           modeler. Meets fourth Wednesday of the month,              all teach the latest Windows technology. Meets
Contact Chairs: Paul O’Rorke and Dave Yost          Cubberley Community Center, 4000 Middlefield,              first Wednesday of the month, 6:30 PM at Sponsored by Agitar             Rm. H-1, Palo Alto                      Cubberley Community Center. Contact Chairs:
Software, eBay Developers Program, Hummer           Contact Chairs: Ron Lichty and Aaron Ludtke                Chuck Berg, David Korn
Winblad Venture Partners, IBM, and Sun              Sponsored by Agitar Software.                              Sponsored by Microsoft.

12              S D F o r u m            n e w s       •      v o l       8 / i s s u e            4       •      w w w . s d f o r u m . o r g
                                                                                       For all SDForum event listings, including SIGs,
CALENDAR – SIGs ONLY                                                                     please visit our website calendar weekly.

            M O N D AY                           T U E S D AY                        W E D N E S D AY                     T H U R S D AY
                                      2                                    3                                    4
                                                    Java SIG
                                          6:30 pm, Cubberley Community

                                                 Center, Palo Alto                      Windows SIG                    Multimodal Interactive SIG
                                                                                6:30 pm, Cubberley Community              6:30 pm, Openwave,
                                                 Founders Forum                        Center, Palo Alto                     Redwood City
                                            6:00 pm, SDForum Offices,
                                                    San Jose

8                                     9                                    10                                   11
           Marketing SIG                       Emerging Tech SIG
        No meeting this month.            7:00 pm, Cubberley Community
                                                 Center, Palo Alto

15                                   16                                    17                                   18
           International SIG                Business Intelligence SIG             Venture Finance SIG
     6:30 pm, Bingham McCutchen,          6:30 pm, Cubberley Community      6:30 pm, DLA Piper Rudnick Gray
             East Palo Alto                      Center, Palo Alto               Cary LLP, East Palo Alto

22                                   23                                    24                                   25
                                               Web Services SIG
                                          6:30 pm, eBay’s Silicon Valley            Software Architecture                     Security SIG
                                          Conference Center, San Jose                 and Modeling SIG               6:30 pm, Cubberley Community
                                                                                6:30 pm, Cubberley Community                Center, Palo Alto
                                                    RFID SIG                           Center, Palo Alto
                                           6:30 pm, Pillsbury Winthrop,
                                                    Palo Alto


                                   PLEASE CHECK WEB CALENDAR FOR DATES:                                               Multimodal Interactive SIG
                    SaaS SIG – 5:30 pm, DLA Piper Rudnick Gray Cary LLP, East Palo Alto                                  6:30 pm, Openwave,
                   Open Source SIG – 5:30 pm, Piper Rudnick Gray Cary LLP, East Palo Alto                                   Redwood City

             Marketing SIG
       6:00 pm, SDForum offices,
               San Jose

                                                     Java SIG

                                                 Founders Forum
                                            6:00 pm, SDForum Offices,
                                                    San Jose

                                               Emerging Tech SIG
                                          7:00 pm, Cubberley Community
                                                 Center, Palo Alto

                                                                                        Windows SIG
                                                                                6:30 pm, Cubberley Community
                                                                                       Center, Palo Alto


19                                   20                                    21                                   22

           International SIG                Business Intelligence SIG              Venture Finance SIG                        Security SIG
     6:30 pm, Bingham McCutchen,          6:30 pm, Cubberley Community          6:30 pm, DLA Piper Rudnick           6:30 pm, Cubberley Community
             East Palo Alto                      Center, Palo Alto              Gray Cary LLP, East Palo Alto               Center, Palo Alto

26                                   27                                    28                                   29
                                               Web Services SIG
                                          6:30 pm, eBay’s Silicon Valley
                                               Conference Center                    Software Architecture
                                                                                      and Modeling SIG
                                                    RFID SIG                    6:30 pm, Cubberley Community
                                                6:30 pm, Palo Alto                     Center, Palo Alto

S D F o r u m           n e w s       •      v o l      8 / i s s u e            4    •    w w w . s d f o r u m . o r g                            13
                  streetwise:               ACCEL PARTNERS

                  The Elusive Great Consumer Experience
W           ith the prolonged lackluster
            IT spending growth by enter-
            prises, many investors and
entrepreneurs have recently turned their
attention to the consumer space. The
                                                  before adoption was proven (think online
                                                  pet stores, groceries, and many others).
                                                  There are certainly exceptions, but they
                                                  are few. Why is this?
                                                                                                      downloaded and used by thousands
                                                                                                      before Accel invested. Ebay’s initial
                                                                                                      growth was fueled almost entirely by word
                                                                                                      of mouth. The services that somehow aid
                                                                                                      word of mouth through network effects
reasoning goes that many of the most              The key “hit-making” characteristics of             usually have the most explosive adoption
prominent venture-backed successes of             an experience are often subtle and only             characteristics. theFacebook was started
the past decade have been consumer                discoverable through early experimentation.         by a 19 year old Harvard student out of
businesses (Ebay, Google, RealNetworks,           Ebay’s user feedback system was critical            his dorm room, and the service has grown
etc.), consumer spending has remained             for building trust and community.                   to several million users on 600+ campuses
robust, and the online advertising market         theFacebook’s membership restriction to             without spending a dime “acquiring
is experiencing strong growth. So it              college students with “.edu” email                  users.” Of course, the entire early nature
would seem like a good time to fire up            addresses kept the service relevant and             of theFacebook usage was communicating
PowerPoint and hit Sand Hill road with            free from the pollution of undesirable              with others, so distribution was a natural
the next big consumer idea, right?                users and behavior that plague “social              outgrowth of product adoption. Money
   Unfortunately, some of the most colos-         networking” sites. Skype’s NAT/firewall             can buy “traffic” or user trial, but not
sal venture failures were also consumer           traversal and the incredibly clear voice            true repeat usage. If the service is not
projects. The overwhelming majority of            codec they licensed made the first-time             compelling, then money just temporarily
the well-financed e-commerce and social           experience with their product frustration-          masks a failed consumer experience.
networking companies are either in the            free and exhilarating. For every successful
scrap heap of the dot-com bust or are             product there are generally several failed          When possible, draft behind an 18-wheeler.
rapidly headed in that direction. I thought       competitors with the same idea that                 This is not to diminish the importance of
it might be helpful to reflect on some            missed these important subtleties (Six              strong distribution, however. Google’s
takeaways for the would-be consumer               Degrees vs. theFacebook, Dialpad vs.                “OEM” deal with Yahoo contributed
entrepreneur:                                     Skype, etc.). Traditional consumer com-             much of their early traffic. Skype
                                                  panies (movie studios, electronics firms,           benefited from distribution through the
It is best to experiment and get real             packaged goods manufacturers, etc.)                 Kazaa network. PayPal’s de-facto distri-
adoption before raising money.                    recognized this long ago and structured             bution through EBay users was important,
Virtually all of the best venture-backed          their businesses as portfolios where cash           though it is notable Billpoint, Ebay’s
consumer businesses didn’t raise their first      cow products fund failure-prone new                 own service, could not benefit from that
round of venture capital until a large and        product introductions. So, it shouldn’t             same distribution. The PayPal/Billpoint
growing number of users had adopted the           be a surprise that venture capitalists trying       example reinforces the premise that
product or service. This doesn’t mean the         to predict consumer adoption generally              consumers are extremely loyal to a great
companies were profitable or even gener-          lose their shirts. Worse yet, many venture          user experience.
ating revenue (though Ebay famously               investors exacerbate the problem by
never spent a dime of their venture capi-         pressuring their entrepreneurs to abandon           Usage should never be
tal), but instead that the company had            experimentation in order to focus on                mistaken for adoption.
proven to some degree that the user expe-         rapidly growing revenue. If the product             Not every service with good traffic or
rience was compelling. This was true for          has not achieved resonance yet, that is a           “usage” statistics makes a great business.
Ebay, Google, and RealNetworks, and it is         recipe for disaster.                                For example, I looked at a mobile TV
also true for some of the most interesting                                                            service with great “subscriber” growth
new consumer investments today like               Money cannot acquire customers. Great               numbers. A deeper look revealed that
theFacebook (an online media company              consumer experiences acquire customers.             while a lot of people tried the service,
adopted by millions of college students)          A common question is, “How can I                    few actually used it more than once per
and Skype (the European p2p voip                  launch my service without money?”                   month – if that. The best consumer expe-
company with tens of millions of users).          Word of mouth is almost always the                  riences are addictive, and they become
On the flipside, virtually all of the colossal    best form of customer acquisition.                  more and more embedded in the user’s
failures raised large amounts of capital          The RealNetworks media player was                                          Continued on page 15

14             S D F o r u m            n e w s      •     v o l     8 / i s s u e          4     •      w w w . s d f o r u m . o r g
Continued from page 14                              or to help them “collaborate.” Simply
daily life over time. Ebay has become the           put, initial consumer demand is usually                  membership
entire livelihood for thousands of people           driven by more primal instincts: free or
and small businesses. Families stay in              cheap stuff (Ebay, Skype, LendingTree,
touch with overseas relatives on Skype.
theFacebook has extended beyond social
                                                    Wal-Mart), rapid access to information
                                                    (Google, Yahoo), entertainment
                                                                                                         Do you
interactions into many facets of campus
life including events, coursework collabo-
                                                    (RealNetworks, iTunes), loneliness miti-
                                                    gation/social interaction (theFacebook,
                                                                                                       know your
ration, communications, etc. Therefore,             Skype,, or competition                   SDForum
it is important to understand statistics like       (games, fantasy sports, etc.). Of course,
repeat usage and churn. Most consumer               vices like pornography and gambling                 Benefits?
businesses with rabid and growing                   are big drivers, but without being too
                                                                                                    Individual Members
adoption are ultimately able to make                Freudian one can argue those are simply
money if the cost of delivering the                 extreme forms of loneliness mitigation          ■ Borders Books Discount
product or service is reasonably low.               and competition respectively. This list
                                                    of drivers is not exhaustive, and success-      ■ UCSC Extension Discount
Learn and own your early                            ful consumer businesses often graduate          ■ Conference Discounts
demographic before expanding                        to satisfying more sophisticated and              & Free Passes
Successful consumer businesses generally            subtle needs, but if the initial consumer
                                                                                                    ■ LinkedIn Group Membership
resonate first within a particular commu-           idea is pretty far removed from all of
nity of interest before expanding, though           these drivers then the entrepreneur
that community may not be the one                   should think pretty carefully whether           Startup/Company Member
initially anticipated! EBay started as              the service is likely to strike a nerve.
                                                                                                    ■ Business Planning
a service for pez-dispenser collectors.                                                               & Strategy Coaching
Tickle, an online dating site that pio-             The right partner and capital are
neered the use of psychological profiling,          crucial for exploiting the opportunity          ■ Phase Forward – Discount on
found early adoption by evangelical                 So…is there a place for venture capital           Product Development Services
women from Texas. Skype started with                in a consumer business? Absolutely.             ■ 401 (K) Plan
the teenage Kazaa user base cultivated by           Once the kernel of the service has estab-
the Skype founders (who were also the               lished some resonance, the right partner        ■ Company in Residence Program
Kazaa founders). theFacebook focused on             and capital are critical to make sure you
                                                                                                    ■ By Appointment Only – Discount
college students, but is now expanding to           lock down the distribution sockets, hire          on Telesales Service
alumni. PayPal adoption started with the            the best team, build out the required
Ebay community (though the initial target           infrastructure for growth, establish your       ■ Meeting Room Rental
market was PDA users exchanging money               brand, and suffocate the competition.           ■ Legal Coaching
through infrared exchanges!). While it              Fledgling consumer businesses are
may not always be easy to predict which             extremely fragile, and often can be easily      ■ VC Coaching
consumer segment will first resonate with           copied and crushed by well-capitalized
your service, it is important to recognize          incumbents. eToys was crushed by                Additional Resources
and reinforce those effects post-launch.            Amazon. Microsoft notably crushed
Usage grows best from a base of strength.           Netscape, but RealNetworks,                     ■ IT Conversations Audio
                                                    Macromedia, and Intuit thrived despite
Forget about ROI. Consumers don’t                   Microsoft’s onslaught. Winning initial          ■ Vendor Resource Pages
behave like engineers or businesspeople.            adoption is a huge hurdle, but it is only
Many former enterprise software or                  the first step.
                                                                                                    COMING THIS FALL:
infrastructure entrepreneurs bring an                                                               ■ Member Breakfast
enterprise orientation to consumer                                                                    Networking Event
projects…with disastrous results.                   Kevin Efrusy invests in consumer internet
                                                    and other software companies for Accel               Visit the website at
Entrepreneurs scratch their heads why
consumers eschew every attempt to                   Partners. He led Accel’s investment in               for more details on
“organize” internet searches better, to             theFacebook and serves on the board of                all of the benefits!
manage their calendars more efficiently,            BBN Technologies.

S D F o r u m          n e w s        •     v o l      8 / i s s u e          4    •     w w w . s d f o r u m . o r g               15
                 event review:                 WEB SERVICES CONFERENCE

                 The Next Generation
O         n May 24, 2005, SDForum
          held the annual Web Services
          Conference at the Network
Meeting Center in Santa Clara. Since
2000, XML-based web-services applica-
                                                said the WS-* Architecture creates a layer
                                                of security allowing IT managers to
                                                control network access across platforms.

                                                The State of the Service
                                                                                                   control process. In turn, process should
                                                                                                   drive application development. Because
                                                                                                   of this new dynamic, process is finally
                                                                                                   becoming a first class citizen in application
                                                                                                   development. Businesses need the flexibil-
tions are gaining attention and acceptance      The first panel discussed the unfolding of         ity offered by the BPM convergence. ESB
in the enterprise space. This conference        three standards, SOAP, REST and AJAX.              is a connectivity layer for BPM. They
helped clarify the current state and future     Moderated by David Nielsen, Manager                think there is a need for a choreography
direction of the industry by focusing on        of the PayPal Developer Network, the               between BPM, WSDL and SOAP, etc. to
“the web services stack in action.”             panelists were Jeff Barr, Web Services             increase high-level interactions. Business
   Frank Cohen, author and web service          Evangelist, Amazon, M.R. Pamidi, CEO               rules allow partners access with controls
expert, kicked things off by talking about      C-Cube Consulting, and Bret Taylor,                you both agree upon. Standard Portable
the importance of XML in web services in        Product Manager, Google Maps.                      Abstractions allow you to write less code
remote procedure calls. He thinks SOAP             Of the three standards, SOAP is the             and leverage existing body of work. On
is an experiment in XML.                        oldest standard and most mature. Used              the topic of business transactions versus
                                                by Fortune 500 companies, SOAP is                  Service Oriented Architecture (SOA), they
Web Services and Identity                       considered ugly but it works and handles           think there is room for both. They also
The first keynote speaker was John              financial data well. The second standard is        think BPEL is catching on.
Shewchuk, CTO Distributed Systems at            REST. It returns XML to a browser and                 The second keynote speaker was Kelvin
Microsoft, speaking on Web Services and         is fast and easy to learn. The http gets and       Lawrence, DE and CTO, Emerging
Identity, Metadata, Identity Metasystems        displays results on the browser. Security is       Internet Software Standards, at IBM.
and Security Token Services (STS).              not the big concern; the idea is to just get       He said the evolution of the Internet
Shewchuk said we must recognize that            the data to customers. The latest WSDL             is toward OnDemand business. Using
there will never be a homogenous data           uses both SOAP and REST. AJAX is the               history as a guide, he talked about how
environment. Heterogeneity is a given           newest standard, using Javascript for http         standards were established. The Chinese
and interoperability a must, but security       requests. Used mostly in browsers, it is           Emperor Qin tried to establish standards
is the real issue. Ultimately, you will need    becoming a state-full vs. stateless operat-        in currency, weights and measures etc.
more than a user name and password              ing system. AJAX works on the client but           The standards were strictly a top down
because of identity theft. Corporations         not the server sides, so you don’t know            affair. You had to accept them.
issuing smart cards to employees are not        how it will behave on different clients.              Today, companies have to be persuaded.
enough. Consumers rejected Microsoft’s          Microsoft’s WS* uses SOAP. GoogleMaps              There are lots of mergers and companies
Passport idea, so that won’t work, but          and Gmail use AJAX. Amazon builds for              bringing horizontal IT systems online.
metadata might. Metadata makes difficult        SOAP, REST and AJAX. The panel said                The legacy systems are custom built, so
tasks automatic, quickly describing data        there would be SOAP in the future. Its             they don’t share easily on the web, but
and the level of security attached to it.       use may even increase with improved                companies don’t want to just them throw
At the moment, there is no single solution      tools.                                             away. The SOA key is OnDemand and
for signing on, so how do you make it                                                              open source system models. We need
easy? The solution may be to invent a new       Workflow and Business Process                      flexible IT systems with composable
layer for security. Remember that a file is     The second panel discussed workflow and            processes supplying composable services.
just an abstraction, so we need to create       business process. Moderated by Ash                 Security, reliability and interoperability are
an abstract for security. WS Security           Parikh, Director of Development and                the three things customers demand. The
allows you to connect with abstractions.        Technology, Raining Data, the panelists            OASIS organization’s WS Security 1.0 is
Shewchuk described the laws of identity as      were Jelle van Geuns, Director of                  more widely adopted and SOAP/WSDL
follows: user control and consent, minimal      Solutions Engineering, ILOG, Edwin                 Security is more widely deployed. You
disclosure, justifiable parties, directional    Khodabakchian, VP Product                          don’t have to write the code, IBM will do
identity, apluralism open to all and human      Development, Oracle, and Jeremy                    it for you. Web Services Interoperability
integration. The Service must negotiate         Westerman, Director Integration Product            (WS-I) is developing standards to test new
with WS Security and customer while             Management, BEA.                                   apps and see if they are compliant. While
encapsulating the information. Shewchuk           They believe business rules should                                       Continued on page 17
16             S D F o r u m          n e w s      •    v o l      8 / i s s u e         4     •      w w w . s d f o r u m . o r g
Continued from page 16                             along those lines. XML, SOAP and               Simpler technologies like REST do
there are many horizontal functions like           WSDL need to be able to use and parse          everything over http. Universal Business
payroll being addressed, there are a lot of        metadata. Another question was how long        Language (UBL) is a document language
vertical or industry specific functions like       could you ignore the momentum of a new         to carry out biz processes like sales,
health care that need to be. In conclusion,        standard? Yahoo and Ebay still use SSL         catalog, purchase, and invoice. European
web services are being broadly adopted,            and not WS Security to keep it simple.         governments are using UBL. ADAM
open source is a serious choice and tools          SOAP doesn’t work everywhere like PHP,         is standardizing RSS with language and
are improving.                                     Perl, and Python. SOAP eliminates the          protocol. Everything has titles, IDs and
                                                   need for SDKs for Java or .NET, but still      date stamps. Specs are boring, doing is
You Can’t Model Everything                         needs to be tested with each client to see     exciting.
At lunch, the speaker was Gordon                   if it works well. At Salesforce, reliable
Simpson, VP Applied Platform                       messaging is important to make outbound        The Future: Management,
Technology from SAP. He said from his              calls, so they need new specifications on      Control and Optimization
experience, selling software was a lot like        standards. Kenai looks for automation          The fourth panel was moderated by Steve
an old time traveling medicine show, with          of security in different environments for      Gillmor, Journalist contributing editor,
XML no exception. XML promised a lot,              reliable messaging. There is a demand and      ZDNET, Larry Abrahams, Senior Vice
but it has gone through two Gartner                an opportunity for interfaces in different     President, Product Development and
disillusionment curves. He thinks we have          languages. Third party developers can          Engineering, Blue Titan, Sean Fitts,
learned our lessons and are leveraging             help you fill the gaps in your service and     Chief Architect, Amberpoint, and Joelle
them now. Models are limiting. You                 increase revenue. Highest performing sites     Gropper Kaufman,VP Marketing,
can’t build a model for everything. Web            are using REST.                                Reactivity.
services should be low risk, high value,                                                             The discussion began with: is there any-
enterprise class, and on an interoperability       The Loyal Opposition                           thing for SOAP acceleration? What next?
platform. He thinks it can deliver.                The third keynote speaker was Tim Bray,           Amberpoint provides management sys-
Simpson is disturbed that his business             Co-inventor of XML and Director of             tems on XML. Management operations.
process does not have pyramids or                  Web Technologies, Sun Microsystems.            Insert management and control in this
spheres. It does, however, have an XML             Describing Sun as the loyal WS opposi-         environment. Networks are configured in
based interface, treating it as a native           tion, Bray thinks WS* will not work well.      a declarative fashion so they will under-
language in SOA. By 2007, all SAP                  The web worked and allowed enterprises         stand that and still use internal business
solutions will be ESA Enterprise Server            to work across platforms and still scale up.   processes. Execute a series of policies and
Applications compliant.                            The future lies in systems built to handle     Amberpoint will optimize it.
                                                   messages. Things that are ridiculously            Reactivity tries to optimize SOA and
Why Standards Matter                               simple succeed. This is of overriding          network operations. By offloading schema
The third panel was moderated by                   importance, as seen with Google.               and cryptography, they speed things up.
William Grosso, VP Engineering,                    Technology predictors show that complex        They want agility but visibility by keeping
Echopass and the panelists were Benji              schemes fail. To succeed, you need good        track of message flow. Major businesses in
Jasik, Sforce Product Manager,                     implementation that really works, happy        manufacturing, travel, retail and govern-, Jack Quinnell, CTO,                programmers and technical elegance, but        ments are going SOA in a big way to deal
Kenai Systems, Adam Trachtenberg,                  the most important is hitting that 80/20-      with each other. Some organizations are
Manager of Technical Evangelism, eBay,             point. Does it get you 80% there with          using it to solve internal problems to
and Jeremy Zawodny, Technical Yahoo,               20% of the effort? Hitting that point will     avoid fiddling with their mainframes and
Yahoo! Inc.                                        change the world. Toys are the turning         IT suppliers. There is considerable growth
   There have to be standards, but at what         points. Bray quoted Gall’s Law. A com-         in bigger messages 2MB or larger, mainly
level? At Yahoo the bare minimum was               plex system that works evolved from a          of maps and documents.
HTML over http, because they wanted a              simple system that works. Extreme pro-            Blue Titan supplies SOA networks with
low barrier of entry for the average con-          gramming takes the top three most              routers that enforce policy using many
sumer. EBay started with more standards            important points and does them really          approaches. They supply security and
but still tried to keep it simple, but the         well, and moves on to the next three.          reliability. Agents are invasive like
SOAP stacks are now mature enough to               There are better solutions than XML            Amberpoint. Blue Titan believes in
address the needs of developers. Salesforce        schema like ISO standards with open            federation, data managed in many differ-
started with XML but went quickly to               source tools. If you view source on WSDL       ent ways. A smart network infrastructure
SOAP for B2B solutions. From a vendor              code, you can’t understand it like an          can be built through standards in a
perspective, Kenai asked customers what            HTML code. It is too complicated.              federated manner. SRM is used for reliable
standards they wanted and developed                                                                                      Continued on page 23
S D F o r u m          n e w s       •     v o l      8 / i s s u e          4    •     w w w . s d f o r u m . o r g                      17
                 event review:                 MARKETING SIG

                 Say Less Listen More: Business Weblogs
C         redible companies with loyal cus-
          tomers and employees are realiz-
          ing that they must participate in
the discussion of their current organiza-
tional effectiveness by using Weblogs for
                                               real conversation, encourages personal
                                               introduction and value added personal
                                               communication. This dynamic characteris-
                                               tic of weblogs and their word of mouth
                                               referral linking result in consistently high
                                                                                                     commenting and discussing them online.
                                                                                                     Employees have the potential to influence
                                                                                                     the way customers perceive the organiza-
                                                                                                     tion in the very same way.
                                                                                                        There are issues as with any new tech-
both internal and external communica-          quality and fresh content. Stavinsky                  nology. Proprietary company information
tions. By creating and facilitating a casual   repeatedly cited quality and content as the           must be protected by employing employee
online discourse that augments their           biggest benefits of business weblogging. In           common sense. Comment spam filters
conventional marketing efforts, companies      addition, by adding the consumer’s voice              must be updated to prevent the weblog
are increasingly able to generate immediate    consistently to the marketing mix, the net            version of email spam from filling your
goodwill, awareness and support brand          effect generates an authentic, personal and           weblog comment section with unsavory,
identity. The same technological tools that    credible tone for corporate communica-                suggestive and sometimes hateful content
gave root to personal journaling (weblog-      tions. As an added benefit, search engine             which can reflect poorly on brand identity.
ging) and artisan journalism (non-creden-      rankings are positively impacted when                    Fortunately, because of the way weblog
tialed reporting) have been co-opted by        adding a weblog to your static business               software is organized, postings that do
savvy marketers and company evangelists        web page. It really does drive new web                not find an audience of other webloggers
to include a wide range of potential           visitors and new customer revenue.                    willing to build the buzz of the original
customers both internal and external to           Weblogging, both corporate and artisan             comment will quickly fade from the top
the organization – and the concept is          are quickly eclipsing the static world of             rankings on that subject across weblogs
becoming wildly popular worldwide.             traditional marketing communications.                 worldwide. That is an important contrast
   Weblog’s are like the water cooler          Customer buzz is being created every sec-             to the last participatory web community
conversations of old, except now everyone      ond by happy and disappointed customer’s              development, commonly known as the
gets to join in and therefore the dialog       word of mouth and immediately linked                  online message board. Negative and
benefits all, even if the message has ele-     throughout a network of millions of                   unpopular weblog comments fade from
ments of the good the bad and the ugly.        weblogs. The current and future reality               view quickly as quality, integrity and valu-
Moderator Robin Stavisky, Managing             is that traditional corporate marketing               able conversations quickly push the chaff to
Partner of New Venture Marketing in Palo       communications, ie. “the press release”               the bottom of the conversational choices
Alto1 introduced the concept of business       are now treading water and fading quickly             well beyond most reader’s attention spans.
weblogging and cited her current source        as the means to influence and build brand                In summary, weblogging has been made
of inspiration/guidance as audience mem-       awareness with fresh credibility.                     easy enough for the average web user to
ber Evelyn Rodriguez’s business market-           Ms. Rodriguez, a gifted artisan journal-           master. Micro publishing websites are
ing weblog: “Crossroads Dispatch”2.            ist specializing in business marketing,               springing up faster about your products
   Old school marketing exec’s take notice:    advises that business blogs should be a               and corporate policies than any PR depart-
Repackaging your current message and           place where customers are proactively                 ment can put out clarifying redefining press
expecting bloggers to march to that tune       encouraged to participate. Savvy marketers            releases. Is your company prepared to join
will be met without success. Corporate         are creating a seat at the marketing table            the conversation?
weblogs can’t just be more marketing plat-     and facilitating those willing to voice their
itudes. They must be honest, open, inter-      feedback on company policy, product                   David Chamberlain, resident of Half Moon
esting and offer value that resonates with     quality, management decision making and               Bay, California and Savognin, Switzerland
real people. Most importantly, the content     just about every other issue possible.                is the founder of
offered and discussed must garner and             Customers and employees like to be                 a six year old boutique travel consulting firm
maintain ‘street cred,’ better known as bal-   heard. Weblogs represent a valuable new               and leading provider of custom designed lux-
anced and fair minded assessments rather       paradigm in web technology.                           ury adventure photo safaris, small ship cruis-
than auto generated marketing messages.        Conversations can be carried on across                es and expeditions to the most enchanting
   Non-weblogging business websites are        weblogs utilizing technology only found               wilderness chillout retreats on earth! Contact
typically restricted by strict corporate       in weblog software. Customers are influ-              David via or
brand/competitive and legal policy per-        encing customers by writing reviews and               1-866-589-8792.
taining to linking and affiliating with 3rd                    1
party websites. Business blogs, just as in                     2
18            S D F o r u m          n e w s      •    v o l          8 / i s s u e         4    •      w w w . s d f o r u m . o r g
                 event review:                     OPEN SOURCE SIG

                 The Next Wave of Open Source: Applications
L    arry Augustin is CEO of Medsphere,

     an open source software company that                                                                   PROPRIETY                open source

                                                 OPEN SOURCE
        delivers a sophisticated healthcare                                 Sales Cycle                        Long                        Short
information system. Prior to Medsphere,                                     Pilot                               Yes                    Do it yourself
he was a partner at venture capital firm                                    Enterprise ready                    Yes                        Nearly
                                                                            Install Time                   Long (months)               Short (weeks)
Azure Capital Partners where he special-
                                                                            Large up-front License              Yes                          No
ized in software and systems investments,
                                                                            Developer Community                Small                    Large/Open
including Linux and Open Source busi-
nesses. He is currently of the board of
directors of VA Software, the Open Source              is key – they do not have offerings in the                traditional companies, model is not cost
Development Lab (OSDL), the Free                       low-and-medium-spaces and this is also                    effective in the low-and-medium markets.
Standards Group (FSG), and Linux                       true for the three other business spaces,                    Their investment-expensive structure
International (LI). Larry has a BSEE in                CRM, VOX, and Health Records.                             mitigates against them wanting to compete
Electrical Engineering from the University                All four of these markets are presently                in these areas; hence, the great opportuni-
of Notre Dame, and MSEE and PhD                        served by big, expensive, proprietary                     ties for the open source companies. Open
degrees in Electrical Engineering from                 companies. In other words, a company                      source advantages are summed up in the
Stanford University.                                   wanting to use these products must invest                 table above.
   Larry’s talk at the May Open Source                 millions to achieve their return on their                    Augustin summarized his talk by saying:
SIG meeting focused on answering one                   investment.                                               “If you want to start an open source
key question: Can the open source model                   “This is where the open source model                   business look for:Enterprise applications
lead to making a profitable business?                  can make money – the lower-and-medium                     that have long sales cycles, long installation
   And a short version of his answer would             ends of each of these markets that are                    times and where there is large small-to-
be: Yes, most definitely there are many                not being served by the big, traditional                  medium business market demand”
opportunities using open source and the key            software companies” says Augustin.                           Larry’s talk was excellent – concise, full
is to build a business around a present-day               The key question then becomes: How                     of good information, enlightening – and
market niche that large companies cannot               can anyone compete with these big play-                   anyone interested in starting an open
and are unwilling to compete in.                       ers? Yes, because the open source model is                source business should get in contact with
                                                       based upon a totally different set of model               him. He makes a strong case for the open
To make a case for his answer                          fiscal assumptions.                                       source model as a money-maker, assuming
he examined four companies:
                                                          The chief differentiator between open                  you pay attention to his well thought-out
1. SugarCRM: Customer Relationship
   Management (CRM) company                            source and traditional companies is that                  strategy.
2. Compiere: Enterprise Resource (ERP)                 traditional companies spend approximately
   company (ERP)                                       about 75% of their licenses income on                     Dan Dunne, Ph.D. is an eLearning
3. Asterisk: Voice Over PBX company                    marketing and sales while open source                     Developer and Senior Technical Writer
4. VISTA (Medsphere): Electronic Health
   Record company
                                                       companies have little or no sales or                      and can be reached at
                                                       marketing organization. Therefore, the                    and 408-577-1521.
All four of these companies have
three chief characteristics:
1. Open Source quality-based software
2. Thousands of downloads (close
   to a million each)
                                                                                     SDForum Welcomes
3. Targeting a niche market where                                                    New Staff Member
   the big-boys don’t play
                                                                             SDForum is delighted to introduce Kristen Miller,
                                                                       Executive Assistant to Laura Merling. You will meet Kristen
To be a successful open source company,                                at many of our events and she will be assisting Laura
it’s a must-have for you to have all three                             behind the scenes as well. Kristen has lived in the area
of these qualities.                                                    for 25 years and has done event planning and administra-
   The major companies all compete in                                  tion work for the past 11 years. In her spare time, she
                                                                       enjoys golfing and spending time with family and friends.
these markets, for example, SAP and
Oracle in the ERP space, but – and this
S D F o r u m          n e w s       •       v o l                   8 / i s s u e          4    •    w w w . s d f o r u m . o r g                          19
 sponsor profile: MICROSOFT                      Wal-Mart and Dell. Both have mastered
 Continued from page one                         the complexity of supply chains and                                                                              event review:
 capable of stepping up and adding value         production efficiency in a powerful and                                                                          VISIONARY AWARDS
 to the entire business from day one.            unique fashion. At the heart of this suc-                                                                        Continued from page three
                                                 cess we can find complex and powerful                                                                               Fiorina took an unconventional route
 Creating Business Impact                        systems architectures that run the whole                                                                         to becoming CEO of a leading technolo-
 through Architecture                            business. Again, architecture helps drive                                                                        gy company, earning a bachelor’s degree
 The opportunity for a software or services      success.                                                                                                         in Medieval history and philosophy from
 company to have real impact in the mar-            Finally, a business can excel in the area                                                                     Stanford University. Fiorina holds a
 ketplace is enhanced greatly by the skills      of customer intimacy. Companies like                                                                             master’s degree in business administration
 and vision of certified architects as part of   Amazon leap to mind in this area. The                                                                            from the Robert H. Smith School of
 an overall business team. The underpin-         ability to drive that intimacy is certainly a                                                                    Business at the University of Maryland
 nings of a successful enterprise today are      function of the priorities and people that                                                                       at College Park, Md., and a master of
 the products and services delivered, the        staff the business, but it is also a function                                                                    science degree from MIT’s Sloan School.
 operational model, and the ability to           of the underlying systems that create deep                                                                          Prior to joining HP, Fiorina spent
 create customer intimacy. The architect         customer knowledge and make it readily                                                                           nearly 20 years at AT&T and Lucent
 plays a key role in each.                       available at each engagement between                                                                             Technologies, where she held a number
    At the core of any business are the          business and customer. Imagine Amazon                                                                            of senior leadership positions and
 products and services they offer. These         without the deep and strategic architec-                                                                         directed Lucent’s initial public offering
 might be a distinguishing characteristic of     ture that underlies every aspect of its                                                                          and subsequent spin-off from AT&T.
 the business (e.g., BMW) or they might          business.                                                                                                           Fiorina was named an Honorary Fellow
 be a commodity (e.g., a power company).            Architects of all types are helping to                                                                        of the London Business School in July
 In either case, the ability to deliver in       drive the enterprise forward in this age of                                                                      2001. She has been honored with the
 a timely and efficient manner is key to         rapid and endless change. Entrusting your                                                                        2002 Appeal of Conscience Award and
 driving the business forward. The soft-         business to these individuals sometimes                                                                          the 2003 Concern Worldwide “Seeds of
 ware and IT architects play a key role in       requires a leap of faith in the promises                                                                         Hope” Award in recognition of her
 ensuring that systems support the rapid         they make and the experiences they bring                                                                         worldwide efforts to make global citizen-
 creation and delivery of the offering, and      to the table. The Microsoft Certified                                                                            ship a priority for business. The Private
 that change can be accommodated quickly         Architect program creates a model of con-                                                                        Sector Council honored Fiorina with its
 and efficiently. One of the hallmarks of        fidence in skills, experience, and individual                                                                    2004 Leadership Award for her contribu-
 the certified architect is being able to        characteristics that can diminish your risk                                                                      tions to improving the business of govern-
 combine a perspective on the business           and drive greater returns. That rewards                                                                          ment. The White House appointed her to
 strategy with the specific tactics and          everyone from architect to customer, and                                                                         the U.S. Space Commission to advise it
 processes necessary to run the business.        makes business impact that much greater.                                                                         on the nation’s space science agenda and
 This can prove exceptionally valuable for          The opportunity to use architects and                                                                         contribute a broad range of high-tech
 any enterprise distinguishing itself            architecture is clearly evident, and the                                                                         expertise. Fiorina also sat on the New
 through unique products and services.           Microsoft Certified Architect program can                                                                        York Stock Exchange’s executive board.
    For many companies, the key to com-          provide guidance, insight, and access to                                                                            Fiorina has previously served on the
 petitiveness is operational efficiency. Being   one of the best credentialing model in the                                                                       boards of Cisco Systems, Kellogg
 able to drive lowest cost and fastest time      industry. Visit the Microsoft Architecture                                                                       Company and Merck & Company.
 to market can distinguish the good from         Resource Center today to find out more                                                                           –Introduced by Mr. Larry Sonsini
 the great. Some examples here might be          (
                                                                                                                                                                  Ray Ozzie
                                                                                                                                                                  Chief Technical Officer, Microsoft
          event review: VISIONARY AWARDS SIGHTS & SCENES                                                                                                          Ray Ozzie, the creator of IBM Corp.’s
                                                                                                     Photos by Frederic Arnaudie, S.F. Black and White Gallery

                                                                                                                                                                  Lotus Notes, is an industry visionary and
                                                                                                                                                                  pioneer in computer-supported coopera-
                                                                                                                                                                  tive work. As a chief technical officer of
                                                                                                                                                                  Microsoft Corp., Ozzie reports to
                                                                                                                                                                  Microsoft Chairman and Chief Software
                                                                                                                                                                  Architect Bill Gates. In this role, Ozzie
                                                                                                                                                                  has responsibility for influencing corporate
                                                                                                                                                                  communications and collaboration
                                                                                                                                                                                       Continued on page 21
20             S D F o r u m          n e w s     •     v o l      8 / i s s u e          4      •                                                               w w w . s d f o r u m . o r g
Continued from page 20                           sponsor profile:                                     The companies and the service providers
strategy, applications, and platform infra-      NASDAQ                                             (auditors, consultants, attorneys) all scaled
structure. Ozzie is the founder of Groove        Continued from page five                           the learning curve together, but it was the
Networks Inc., a leading provider of             • For each revenue category, 404 costs             companies that bore all the financial costs.
collaboration software for the virtual             (both the external and internal) are             • The scope of SOX implementation
office, which Microsoft acquired in April          2.5 times more than the financial audit            increased as definitions evolved.
2005. Ozzie continues to be involved               costs.7                                          • Regulatory bodies weren’t clear on what
with future development of the Groove                                                                 they wanted or fully expected.
technologies as part of Microsoft’s                 Not only is there an increased cost to          • Guidance from the “experts” was too top
Information Worker Group.                        implement 404, but most issuers state that           level – no practical help was available.
   Before founding Groove Networks in            their audit costs have also increased perma-       • No consistent approach from the audit
October 1997, Ozzie was the founder and          nently. One viewpoint is that 404 costs will         firms – each had different definitions and
president of Iris Associates Inc. There he       level off and only be a minor expenditure            process models for attestation.
created and led the initial development of       after the initial implementation. Issuers          • Companies trained the auditors who,
Lotus Notes. Before Iris, Ozzie was              believe that if this is the case, the audit will     many times, were very young and
instrumental in the development of Lotus         absorb this new level of control spending            inexperienced.
Symphony and Software Arts Inc.’s                and that overall costs will not come down.
TK!Solver and VisiCalc, and was involved                                                            Qualified Resources
in early distributed operating systems           Opportunity Costs                                  Overwhelmingly, NASDAQ issuers feel that
development at Data General Corp.                The largest opportunity cost is that compa-        the accounting industry does not have ade-
   Ozzie earned a bachelor’s degree in           nies will simply take a reduction to their         quately trained audit staff to work on SOX.
computer science and has been honored as         earnings and then still pursue their planned       • 70% believe that the accounting industry
a distinguished alumnus of the University        business execution. However other areas of           did not have sufficiently trained staff for
of Illinois at Urbana-Champaign, where           businesses were impacted. Many responses             the 404 work.
he was first exposed to the nature and           included:                                          • 61% did not believe that the accounting
significance of collaborative systems and        • Major distraction of priorities – human            industry was qualified to certify.
computer-supported cooperative work.               and capital resources were diverted              • Industry expertise is an issue.
This significantly influenced his perspec-         from building the business to focusing           • Help was inconsistent through the project.
tive on collaborative systems and the              on compliance.                                   • Auditors and consultants deployed “learn
projects he has undertaken throughout            • It is harder to recruit board members.             as you go” model.
his career.                                      • Acquisitions are on hold.                        • Unclear regulatory direction and lack of
   Ozzie is honored as one of seven              • Companies willingly deregister or                  Big 4 cohesion.
Windows® Pioneers by Microsoft, was                decide to stay private.
named Person of the Year in 1995 by PC           • Auditors have an “open checkbook.”               END NOTES
                                                                                                        NASDAQ Issuer Cost Survey, March 8,
Magazine, and was inducted into the
                                                                                                        2005: Weighted average.
Computer Museum Industry Hall of Fame            Clarity and Guidance on 404                        2
                                                                                                        NASDAQ Issuer Cost Survey, March 8,
as well as the InfoWorld Hall of Fame.           Implementation                                         2005: Cost figure was reached based
In November 2000, he received the                There is no real issuer consensus on what is           on a conservative extrapolation to 3,053
                                                                                                        NASDAQ issuers.
Institute for Electrical and Electronics         needed for clarity and guidance from the           3
                                                                                                        NASDAQ Issuer Cost Survey, March 8,
Engineers (IEEE) Computer Society’s              SEC and PCAOB. Clarity on implementa-                  2005: Average Audit cost was $425,078.
W. Wallace McDowell Award. He has                tion requirements, however, did increase as            Average 404 costs was $1,059,969.
served as a member of the National                                                                      NASDAQ Issuer Cost Survey, March 8,
                                                 the year went on. Those who started imple-
                                                                                                        2005: Smaller issuers are here defined as
Research Council’s Computer Science and          menting early paved the way for those who              having revenues less than $100 million.
Telecommunications Board, and was a              started later, but paid additional costs as            Larger issuers are here defined as having
member of the NRC committee that pro-            they were asked many times to retest                   revenues greater than 2 billion.
                                                                                                        See note 1 above.
duced the landmark CRISIS report on the          processes per a new or more conservative           6
                                                                                                        See note 2 above.
societal impact of cryptography, a comput-       requirement.                                       7
                                                                                                        See note 3 above.
er security technology. Ozzie is a member        • 31% of respondents thought requirements
of the National Academy of Engineering,             were clear and understandable.                  Thank you to Bill Shaw, Managing Director,
and was honored as a World Economic              • 42% of respondents thought requirements          NASDAQ, for making these surveys available
Forum Technology Pioneer in 2001.                   were not clear and understandable.              to our readers. More detailed information
–Introduced by Ms. Esther Dyson                  • 27% were not certain.                            on the surveys can be found on the SDForum
    S D F o r u m          n e w s      •     v o l    8 / i s s u e           4     •     w w w . s d f o r u m . o r g                       21
streetwise:                                     making sure there is no unwanted intru-              router,” Kaufman observes. “We are look-
PricewaterhouseCoopers                          sion. It has also been deployed at ports             ing at these kinds of issues all the time in
Continued from page seven                       and other critical infrastructure facilities.”       terms of assessing our own proclivity for
Object Video, based in Reston, VA,                 The convergence of data security and              continuing to invest in a sector. We do
offers intelligent video surveillance for       physical security makes sense. “If you look          not lack for investment candidates,”
physical assets, such as people, buildings,     at the large number of cases of data theft           she adds. “Many, many companies are
and their contents. It is a high-tech twist     that have hit the newspapers,” points out            focusing on security, one of the reasons
in a traditionally low tech area that auto-     Bolton, “it hasn’t just been that people             being that the exit values have been very
mates data delivery from surveillance           have actually broken into data centers,              high and the multiples have been high as
sensors and provides analytics around that      which are typically relatively secure, but           compared to other areas of software,
data. “Using machine vision algorithms,         that they have broken into rental cars or            which are viewed to have been commodi-
Object Video allows customers to indicate       offices and have taken laptops and desk-             tized. Seeing the potential for a really
which events and objects in a video are         tops. Historically the perpetrators were             good return makes security an attractive
important to them,” Kaufman explains.           looking to steal the hardware and didn’t             area to invest in. But, again, not every
“For example, if you care if someone            necessarily realize the value of the person-         company will achieve that goal.”
crosses a perimeter at midnight, you can        ally identifiable information on them.                  A product that makes true security
trigger an alert to someone who is sup-         This pattern is beginning to change as               simple could be a welcome addition in
posed to be watching the video. The alert       identity theft is becoming much more                 the current environment. Unfortunately,
is triggered automatically by software          significant and coordinated. It would not            too often, security is as much a people
analyzing the video. That’s an example of       be surprising to see future efforts target-          and process issue as it is a technology
an interesting area of security where           ing computers because they are believed              challenge.
there’s room for automation and, as a           to have sensitive data given the market
result, there’s a possibility of driving ROI    that is emerging for this information.”              Bill Tobin is Director of the Emerging
for the customers. This is deployed on our         “Another trend we’re seeing is that               Company Services practice at
northern order at various oil refineries        security components are being built into             PricewaterhouseCoopers in the Bay Area.
where the customer is concerned about           technology, whether it’s a database or a             He can be reached at

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                                                                                                        w w w . s d f o r u m . o r g
                editor’s note                                                     This series was initially spearheaded by
                                                                                  Sanford Rockowitz who was joined during its
                                                                                          second year by Bebo White. Together
           SDForum wishes to express                                                      with their committee they brought a
        our sincere appreciation to the
          Distinguished Speaker Series
                                           Thank                               You        round of very special presenters to
                                                                                         the podium. A big thank you to Sandy
                                                                                        and Bebo who are stepping down as the
           committee for their excellent                                               organizers of this series. (To listen to
            monthly programs these past three                                   some of these past events, visit our website at
               years and to thank our co-hosts.                       

event review:                                    insert with Xquery with the current            hardware pushes it even farther. A million
WEB SERVICES CONFERENCE                          standard. Data warehouses are good for         bucks buys a lot, sometimes getting 2 ter-
Continued from page 17                           supplying information to SOA. More data        abytes with faster networks. We respected
messaging. Web services give real                warehouses are gathering information           physics by using a coarse grained model of
ROI and ROA. Expect an explosion                 from disparate sources. Schema problems        restricting messages to the server. We
in RSS-based traffic in public and inside        are getting easier. It is possible to work     made it stateless and broadband now
companies. RSS is just another kind of           without schema because of self-describing      helps ship big AJAX files. Queries are bet-
web service. It is a straightforward way to      data. The future of Xquery is in the           ter ways to get information than through
deliver not just blogs but any information.      embedded market like cell phones or            methods and then applications. RPC is an
   The next disruptive technology could          PDAs with databases of calendars, contact      example of roundtrip protocols turning
be managing IM traffic of financial trans-       information, e-mail. They have a small         into web services and making everything
actions with huge volumes. Not a single          footprint that doesn’t require virtual         hard again. XML query may be unusable
customer operates in a homogeneous               databases from some other place. This          and too complex. RSS worked out very
environment. Heterogeneous environ-              is driven by business needs to find the        well for business documents. Amazon’s
ments mean a future for SOA. That future         price information at the high end for data     Open Search RSS is the way most people
is federation and governance.                    traffic and capacity.                          search, by typing in plain text as used in
                                                                                                A9. We need to develop a standard way
The Role of Data in SOA                          Changing the World Again                       to query a search. Tags are a way to find
The fifth panel was moderated by Frank           The final keynote speaker was an irrever-      related things like photos. The future
Cohen, Founder, PushToTest, Paul                 ent Adam Bosworth, Vice President              is billions of queries a day in a global
Pedersen, Co-Founder and CTO,                    Engineering at Google.                         network that is truly open protocol.
MarkLogic, Sandeepan Banerjee,                      He thinks the web service goal should       Databases will natively support open
Director Product Mgmt, Oracle Server             be to organize the world’s information.        protocol. Closed proprietary protocols are
Technologies, Nitin Mangtani, Senior             Back in1995, a small community devel-          20th century dinosaurs. Mobile phones
Product Manager, Liquid Data Product             oped applications for the web. By 2000,        should use RSS, not try to surf websites.
Group, BEA, Alex Cheng, VP                       over 90 percent of applications were           Distributed transactions do not work on
Engineering, Ipedo.                              written for the web. Perl, Python or PHP       the web. Simple sloppy protocols changed
   The web is one big XML database.              developers are now building bread and          the world because anyone could play. RSS
Xquery or XMLquery reduces the amount            butter applications. HTML is forgiving         2.0/Atom can do this for information.
of code you need to extract the data.            and good for ordinary people running           We need to add a formalization for
There is a debate between the predictabil-       it anywhere. The web scaled really well        requesting a subset or query in a massively
ity of SQL and flexibility of XML.               reusing old files. The web is stateless and    scalable, flexible, and simple way. We can
Replacing SQL and huge tables with               not like object programming. Because of        change the world again.
XML is a more common sense way to                the web, we really do have information at
organize files, documents, etc. Federation       our fingertips. Google is faster than others
allows a question to be answered by              and used more. It became a breakthrough        DJ Cline writes about media and
looking at several sources. Silos are major      when people used it as a verb. Livejournal     technology for SDForum, STC, and the
hurdles for moving data across a company.        is also a verb. Verb products win. Youth       Future Salon. He can be reached via
Unfortunately, you can’t update delete or        socialize with it. It catches on. Cheap        email at

S D F o r u m         n e w s       •    v o l      8 / i s s u e          4    •     w w w . s d f o r u m . o r g                      23
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