Targeting Oracle

IBM software division ready to battle the big guys.

2 min read
Steve Mills is taking on Larry Ellison and Bill Gates.

Steve who?

Next month, the 27-year IBM veteran--little known outside company ranks--will take over the helm of IBM's Software Group, a $13 billion-a-year business that makes up about 15 percent of Big Blue's overall revenue.

With the promotion from general manager to senior vice president, Mills will oversee a collection of software that ranges from the nitty-gritty infrastructure systems that help companies create e-business Web sites to emerging technology such as wireless and voice-recognition software.

PULLQUOTE TEXT He also oversees two IBM subsidiaries: Tivoli Systems, whose software manages the health of computing systems, and Lotus Development, maker of desktop software such as email, instant messaging, word processing and spreadsheet applications.

In an interview with CNET News.com's Wylie Wong, the 49-year-old Mills talked about rivals such as Oracle and Microsoft, his goals for IBM's Software Group, IBM's stance on the Java programming language, and the sometimes frosty relationship with Java creator Sun Microsystems.

CNET News.com: What's your vision for IBM's Software Group?
Mills: We're clearly focused on growth. Today, you look at our major products--DB2 (database software), WebSphere and MQ Series (e-commerce software), Tivoli, and Lotus Domino--and they are all solid, with double- and triple-digit growth. We are gaining market share across all our major competitors. My game plan is to kick growth rates to higher levels.

Nobody has our complete set of capabilities. I'm pouring billions of dollars into technology. I intend to put distance between me and my competitors. I'll niche them into corners of the marketplace and watch them become irrelevant. I plan to take market share from (Oracle chief executive) Larry Ellison every year for the next 10 years. And I have the talent and capability to do it.

What are some areas you are focusing on?
There's some key areas where we are investing heavily. Everything is going wireless and mobile. And we are infusing support for mobile and wireless capabilities into all our products. We have more XML (Extensible Markup Language) support across our products.

Microsoft recently announced a new software strategy, called .Net, that will move the Windows operating system more fully onto the Internet, allowing people to access software over the Web with any type of device. You have long supported Microsoft's Windows operating system in your products. But with the .Net strategy, it's no longer just an operating system--it competes with the vision of computing that IBM, Sun and Oracle have long touted. Will you support .Net?
We'll have to see. What Microsoft is talking about in "="" rel="follow">.Net, we deliver today. It's what e-business is all about. It's what we've been delivering throughout much of the '90s. We enable customers today to do support of any device.

We consider Microsoft competition in the "middleware" (Internet infrastructure software) market. Whether or not PULLQUOTE TEXT HERE we are going to become more competitive as a result of .Net is anybody's guess.

IBM is a strong supporter of Sun's Java programming language. But you've had a long-running spat with Sun over its handling of Java and its decision not to submit the language to an industry standards group. Where do things stand now?
We'd like to see Sun embrace a standards approach. That's what we've pushed them on, and that's what they've been resisting--and that's where the friction has come. Our view is Sun's licensing terms and their stewardship of Java are inhibitors to Java's growth. IBM has contributed as much as anyone else to Java's rate of adoption.

Java is more valuable to them as a Sun brand than as an industry-wide initiative. They're fighting to maintain control, and it's hard to have an (open) initiative when one company has very tight control. This is up to Sun. We've made our position clear. Discussions will continue.

Microsoft just announced a Java-like language called C#. Do you plan to support it?
I'm not concerned about it. Is the world really clamoring for yet another language? We're clearly fully invested in Java. We'll look at C# and watch it.

IBM is also working with Microsoft on creating potential new XML standards for exchanging data between e-business sites. A new communications technology, called Simple Object Access Protocol (SOAP), for example, allows Java software to link to Windows-based software. With IBM's push for standards, do you consider your company the industry watchdog?
We want customers to have freedom of choice. Our principal goal is interoperability.

We're a business. Our job is not to police the industry. Our economic interests are what motivates us. It's not altruism.

We've been encouraging Microsoft to move toward open standards. The SOAP effort had a little bit of that.

Both Oracle and Microsoft have entered the application service provider (ASP) market by renting out software over the Web to smaller businesses. Oracle has created Business Online. Microsoft has created bCentral.com. Do you plan to tackle the same market?
We are in the small-business market. What we're focused on doing is enabling our partners and ASPs to support our technology. We're driving a partnership strategy to reach out to small businesses.