Baan bets big on Windows NT products

It's now pretty strategic for Microsoft, but its financials are looking shaky

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

Baan has just ended thirteen consecutive quarters of meeting financial analysts' expectations, and started a partnership with Microsoft. But which is the bad news? At BaanWorld in The Hague, 3,500 attendees heard Microsoft, in the shape of sales and support VP Jeff Raikes, bless the creation of a partnership whereby Baan will provide all its software, upgrades and self-service support, with exclusively Microsoft software - NT, SQL Server, Exchange Server, and Site Server Commerce Edition. All this for a fee starting at $99 per desktop per month - providing there are 5,000 desktops in the enterprise, providing the deal is for three years or more, and providing that all desktops are counted, whether they are involved in some aspect of enterprise work or not. It makes it a pretty expensive proposition if you do the sums: nearly $18 million over three years for a 5,000 desktop company on our abacus. Previously, Baan's prices were based on the number of users. Raikes' speech could best be described as winging it. He tried to elaborate on the metaphor that Gates casually introduced of the digital nervous system, but his knowledge of genetics was not up to it. There seems to be no correlation between Raikes' claim that "we can facilitate the development of DNS in your organisation" and any concrete definition of what a DNS is really supposed to be. Gates, still an undergraduate despite his honorary doctorate from a private Dutch university, should mug up some undergraduate textbooks on the subject. Baan provided its own definition of DNS - an integrated information management system - so why not call it that? We were left wondering whether users that might want Baan's software would really be influenced by this deal: decisions about servers are rather religious, after all, although pricing is a concern. If Raikes winged his speech, he rode out handsomely on a bicycle made for two that was presented to him as an appearance fee. Baan CEO Tom Tinsley was at the front of the tandem, and this probably marks the only time that Baan will lead Microsoft. Jan Baan and the move to NT Jan Baan's last major contribution to the company seems to have been to have put in place a fundamental move to NT, away from Unix, and away from everything that is not made by Microsoft (or bought-in by Microsoft - such as SQL Server, from Sybase to give just one example). As a result, Baan was able to say that more than half of Baan's sales were now with NT. Jeff Raikes, who should know the real Microsoft sales figures as he's Microsoft's VP of sales and support, claimed that NT Server was achieving 2 million sales/year, Exchange Server 15 million/year, SQL Server 4 million/year, and Office 25 million/year. Until now, Microsoft has mostly talked about percentage increases in sales, because the sales, particularly of NTS, were so low that percentage increases looked like good news. Now that numbers are being claimed, it's interesting that no dollar sums are attached, and that is for the simple reason that there is deep-discounting going on, and quite a few free samples, we suspect. Raikes congratulated Baan for getting the Microsoft BackOffice logo - although we wondered whether Baan's software would roll out problem-free with SMS. Raikes said that there would be native COM/DCOM integration, and liked the way Baan was developing decision support strategy around SQL Server and OLAP Server. The naming of Baan products and services is, well, barmy rather than balmy - fermenting froth rather than fragrant exudations. There's just to much 'Baan'. One very interesting flight-from-Baan is the renaming of Baan Business Innovation to TriArch, which is owned by Vanenburg Ventures, previously known as , err . . . Baan Investments. The company is concerned with enterprise modelling, and employs 200 people worldwide. The relationships between Jan Baan's private companies and Baan NV that caused the financial stir still seem to be very close, and we see the shadow of the Baan Board in the renaming. TriArch's website just happens to reside on baan.com, however, and consists at the moment of a squiggly-pattern page. Baan's new pricing model of per PC rather than per user is a gamble, but one familiar to Microsoft. Remember when per-processor licences of Microsoft operating systems were banned by the consent decree, stopping Microsoft from collecting a fee from OEMs whether a PC was shipped with a Microsoft operating system or not? We see a replay here that could lead to more trouble with the European Commission's DGIV for Competition, and the DoJ if they ever had the time for it. If users feel locked in, they will pay, and perhaps Baan will just improve its income from volume rather than price. The conventional wisdom, which is usually wrong, is that the market is stagnating because of Y2K issues. Wiser councils suggest that users feel that prices are too high for ERP software and that prices may fall for competitive reasons. Some Baan users may not like the strategy being based on the Microsoft relationship, and vote with their feet. SAP remains Baan's major competitor, but although the companies are European neighbours, their cultures differ sharply. SAP's offerings are more expensive and more complex, and there is an element of betting-the-company in deciding to install SAP. SAP's pre-announced Q3 result suggests the full year will be more-or-less on target, but this hasn't stopped SAP's shares halving over the last couple of months. However, even that's better than Baan having more than quartered its share price in six months. An element in this rapid change includes the belief that the ERP market is over-valued, it would seem. So is all this enterprise resource software a good thing, and should an enterprise trust itself to Baan and Microsoft? It would be best to ask Baan: they run on their company on their own code, and Microsoft BackOffice. Baan's evergreen products, as the company likes to dub them, are looking rather deciduous: the leaves are beginning to fall. ® Click for more stories

Secure remote control for conventional and virtual desktops

More from The Register

next story
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
The 'fun-nification' of computer education – good idea?
Compulsory code schools, luvvies love it, but what about Maths and Physics?
Doctor Who's Flatline: Cool monsters, yes, but utterly limp subplots
We know what the Doctor does, stop going on about it already
'Cowardly, venomous trolls' threatened with TWO-YEAR sentences for menacing posts
UK government: 'Taking a stand against a baying cyber-mob'
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Don't bother telling people if you lose their data, say Euro bods
You read that right – with the proviso that it's encrypted
prev story


Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.