MS finally conquers Borland

Once-mighty competitor accepts $$$ for intellectual property

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Microsoft has finally conquered Borland, even if it took the departure of BillG's bete noire Philippe Kahn, and then the sudden and mysterious board-requested resignation of CEO Del Yocam on 31 March, as the result of "philosophical differences regarding the company's growth strategy". It has just been announced that Microsoft has bought a $25 million stake in Inprise (about 10 per cent), and paid $100 million for access to Inprise technology. The deal is called "a set of strategic technology and licensing agreements". There was a long-standing patent and licensing dispute between the companies, and it looks as though Microsoft decided this was not a good time to be in court with Inprise, so what has become known as the "Stac solution" was used. Quite simply, Microsoft forked out enough cash to ensure a "friendly" outcome. This isn't the first time there has been legal wrangling between the companies. Yocam sued Microsoft after it started helping itself to key Borland staff, offering golden hellos, allegedly in an attempt to ruin the company. Microsoft settled out of court. This was sweet revenge for Yocam, since when he was at Apple he initiated the action against Microsoft for stealing the Mac GUI for Windows, although Apple did not ultimately win the case. For its part, Inprise had to agree to support Windows 2000, COM+, and Windows DNA. Inprise will also ship MFC with Borland C++ Builder, and license the Windows SDK. Inprise had a number of consecutive profitable quarters, following Yocam's turnaround plan, but Q1 produced an unexpectedly large loss, rather than an expected small profit, mostly because of restructuring charges. After a change of name to Inprise in April 1998, Yocam split the company into two separately-located operations in January this year - Inprise, based in San Mateo and focussing on enterprise software, and borland.com, a Web tools and services operation in Scotts Valley. The splitting was to be a solution to infighting between those working on the traditional products and the new Java-Corba direction. There must be more than meets the eye in this, and the company's efforts in COM-CORBA bridging could well be one, especially as CORBA is gaining so much ground with the military and in government. The company is one of very few with Java, COM and CORBA experience. Some cynics suggest that this is a move by Microsoft to keep Sun away from Inprise, but this does not seem very likely. Dale Fuller, late of WhoWhere?, Apple, and NEC, was appointed CEO and interim president. Fuller is credited with the ability to create shareholder value. Hambrecht & Quist were retained to advise the board on strategic alternatives, which could have meant separating Inprise from Borland.com, but might well have been this quickly arranged wedding. ®

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