After 14 years at Oracle under the tutelage of Larry Ellison, Bloom is striking out on his own as chief executive of Veritas Software--and his goals are as grand as his former boss', but his ego is much smaller.
Bloom's aim: to emulate the success of the No. 1 database software maker by increasing Veritas' yearly revenue from $1 billion to $10 billion in the coming years.
"There's nothing I haven't seen before. What that means is, where Veritas needs to go, I've been there," said Bloom, a former executive vice president at Oracle, where he ran the company's database business and worldwide marketing, among other duties. "I'm in a unique position where I can avoid the pitfalls that may have affected Oracle over the years. Very few companies get past a $1 billion run rate. A smaller number have passed five. I can architect a smooth transition from $1 billion to $10 billion."
Four months into the job, Bloom has a good head start. Wall Street analysts view Veritas as the early market leader in storage management software. It competes against players such as Legato, Computer Associates, IBM's Tivoli Systems and new entrants in the market, such as Microsoft and Sun Microsystems.
Veritas' technology backs up company data in case of a computer system crash. The company offers "clustering" technology, which connects high-end computers together. If a computer goes down, businesses can still retrieve their data because another computer steps in to do the work. The company is also an early player in the storage area network market, which comprises special-purpose networks for storing data.
Veritas' stock price has plunged from $110 to about $50 since Bloom has taken over the helm. But the company's sales have remained hot while the U.S. economy has cooled. The data storage software maker says it's still on track for 45 percent to 50 percent revenue growth this fiscal year after recently raking in a fourth-quarter profit of $83.9 million, or 19 cents a share, on sales of $370.1 million.
Bloom spoke with CNET News.com's Wylie Wong this week about his reasons for leaving Oracle and his goals for Veritas.
What was the deciding factor for you to become Veritas' chief executive?
Veritas is in the pre-eminent position to grow phenomenally. Veritas had two key ingredients that mirrored what Oracle had: a great company with the opportunity to become the technology standard in the marketplace for data availability software, just as Oracle became the standard for databases eight to 10 years ago. Second, Veritas has a multiplatform strategy, supporting multiple vendors, all operating systems and storage devices.
On a more personal side, I was ready for the CEO position, and my belief is the No. 1 position at Veritas is better than being the No. 2 guy at Oracle. How patient do you have to be? I was there for over 14 years. It was my belief Larry (Ellison) was not going to retire anytime soon. I didn't want to wait until my late 40s and 50s to be CEO. I've passed up many opportunities to be CEO for companies I didn't think warranted my skill level.
What's your vision for Veritas?
We're clearly focused on accelerating growth and maintaining the growth we've enjoyed so far. Our guidance for the quarter is 45 to 50 percent revenue growth. That's bold in today's economic climate.
How realistic is your goal of becoming a company with a $10 billion run rate?
If you look at the information space and look at everything you do as storage--calendars, PowerPoints and Excel files, and everything companies are doing around e-business--there's more need for storage. It's customer relationship management, online music and video. Companies depend on information. People are used to having it. We're in the heart of that. The reliable delivery of data. The storage space will accelerate, and we're the software to manage that information. It's a market that has yet to be tapped.
How do you view the competition? You sell a lot of software on Sun hardware, but Sun's also entering the storage software market. You were quoted recently as saying, "Sun's been trying to engineer Veritas out."
We're both partner and competitor to Sun as well as EMC. We both add value to their storage platforms. But in both cases, both have proclaimed (their intent to enter) the software business.
Are you concerned?
When you have big players entering the marketplace, you watch them carefully. But we serve multiple storage server platforms. Veritas is very unique in supporting everyone's hardware. We give interoperability to (customers) that they can't get any other way. Even if Sun and EMC want to (support other storage hardware makers), they will get little cooperation (from their competition) and are not well positioned to do it. Our partnerships far outweigh the competitive angle.
Our Windows NT data backup sales grew 51 percent in the last year, and our Unix sales grew 72 percent, and those markets were believed to be at 15 percent and 25 percent, respectively. So obviously, we're taking market share from our competitors.
Some Wall Street analysts say Veritas can become the operating system for storage. Do you agree?
It's precarious to use the operating system terminology. In some ways, yes, we are similar to MVS (mainframe operating system), to IBM's OS/390 systems, or Windows NT for the Intel chip. We are going to be the operating system, but the difference is that most operating systems become commodity items. We don't believe data availability will lead to being a commodity.
Do you see any gaps in your family of products?
We have no problem reaching the $5 billion to $7 billion revenue range with the product family we have. We're forever looking for ways to broaden our approach to data availability, but we're in very good shape.
How will you weather the current economic downturn?
We want to expand our business overseas. We can sell a much larger piece of our product portfolio in Europe, Japan and Korea. Our sales are 28 percent international and 72 percent U.S. I'd like to see the international mix grow one to two points a year over the U.S. mix.
We're in a horse race with the economy. Can I expand (sales) with new products and new platforms (in different geographic regions)? Veritas has historically sold on Sun Solaris and Windows NT. Last year we supported the Hewlett-Packard platform and did $100 million in the first year. We're now working on an IBM product line, and we think IBM is a huge opportunity for us.
Since you've become CEO, two other former Oracle executives have joined you at Veritas. Is there any concern of a culture clash?
When you have a leadership change, naturally it's a change. I'm from a different place. I have a different personality and a different way of operating. But with that said, my background at Oracle was one of counterculture. I never ran my operations like most of Oracle ran. I was known for a high degree of sane business decision-making, and a clear focus on deliverables. That was the atmosphere. Our chairman, Mark Leslie, who was our former CEO, made a comment that I fit better to Veritas than I did with Oracle's culture.
Veritas' culture has yet to be defined. We're growing so quickly. Our hiring plan is to go from 5,000 employees at the end of the calendar year to 7,400. If we meet our hiring goals a year from now, 50 percent (of the employees) will have less than 18 months with the company. In the Oracle environment, I adopted different ways of operating. Given that flexibility, I can really fit in at either location.