SII users hear soothing words from board chair, CEO

SACRAMENTO, Calif. -- Showing up to talk to their customers and set a tone of listening and working harder, SII Chief Executive Erika Williams and Chairman of the Board Neil Diver were the highlights of the annual meeting of the System Integrators Systems Users Group, held here April 22-24.

Members of the European users group met concurrently with the North Americans for only the second time ever. Attendance was 90-plus from about 55 sites worldwide. For the first time delegates from Canberra, Australia, and Singapore represented SII's significant Asia-Pacific customer base.

Traditionally the U.S. group has met twice a year, spring and fall, but demands of this fall's national elections and the Atlanta Summer Olympics persuaded the organization to conduct a single spring meeting, as was done in 1992 and 1988.

Perhaps to underscore the importance of the gathering, SII sent its board chairman to explain the company's status and assess its future in a closed-door briefing. In an earlier briefing, CEO Williams gave the group an opportunity to quiz her on any issue.

After the private sessions, Steve Nilan, SII vice president of business development and marketing and the long-time leader of the company's new technology division, MediaBridge, commented on developments discussed in the private sessions.

He confirmed that users heard confidential updates on new products to be released this year by Tandem Computers Inc. of Cupertino, Calif. One was the already-delayed ServerNet. Tandem may announce details of this product by May 8, along with an expected big announcement on a long-awaited agreement with Microsoft.

Tandem has been negotiating for more than a year with Microsoft over implementation of a Windows NT "personality" for Tandem's Non-Stop Kernel operating system for its CPUs. That would allow Tandem systems to be file servers to any user workstations able to connect to Windows NT servers.

This would be a big and growing market.

Non-Stop Kernel already provides two "personalities," simultaneously serving as an old-style Tandem Guardian server (such as the SII system uses), and as a UNIX server. If Windows NT personality is added, Non-Stop Kernel could support users in all three modes. With those features and the fact that the hardware virtually never crashes, Tandem would continue to have a lock on its position as preferred top-of-the-line server.

Tandem's ServerNet product already has been profiled in computer industry press reports, and some public information is available on Tandem's own web site (http://www.tandem.com).

ServerNet will be something like a network of CPUs, disk drives and network ports with a built-in communications switch like a telephone system. Any device, CPU or port can connect in nanoseconds to any other device, CPU or port.

Tandem promises overall data throughput in the previously impossible range of terabytes per second. (A terabyte is 1000 gigabytes; a gigabyte is 1000 megabytes. Data transfer rates in most hardware now are in megabytes per second.)

Lunch with Chairman Neil
SII's post-Chapter 11 board has five seats.

Three represent banks and outside investors, inheritors of the company when SII emerged from bankruptcy and are holders of new Class A stock. They are Diver; Ed Thompson, former CFO of Amdahl Computers, and George Martin, a Dunn & Bradstreet vice president and new media analyst who has worked for AT&T and IBM.

Former directors, and some former and current employees, may own Class B stock, and their representative on the board is SII's former CEO, William Aaronson. Together, these four board members jointly elect an independent fifth member.

At first Diver was the fifth board member elected by the other four. After Class A Director Vaughn Morgan -- a private investment consultant based in Dallas and Santa Fe, N.M. -- resigned for personal reasons, Diver was asked to change his status, becoming a representative of Class A shareholders; he then was elected chairman of the board.

The fifth board seat remains vacant.

Diver, an active San Francisco-based investor and company management expert, founder of more than half a dozen companies, entrepreneur and civic activist, is now chairman of SII's board of directors.

Lunching with users, Diver said the board wants to strengthen SII's management and keep talented people working for the company. SII would move to introduce new products that work well and are delivered on time, he said, adding that failures to do so in the past are being corrected.

Reports that "banks are running the company" are not true, he said. None of the directors is an employee of any of the owning banks.

Chief Executive Williams spoke to the group at the luncheon, and also made herself available in another closed-door session to answer questions from customers.

She later characterized her remarks to the user groups as an admission that some products released in years past were not ready. She said SII has been working over the last 18 months to fix the problems.

With the new releases this year, she said SII hopes to regain the confidence of customers and get the company back on track as the provider of the world's most popular publishing system.

When asked about the pending lawsuit with CE Engineering Publishing Systems Inc. of Loomis, Calif., both Diver and Williams said they could not discuss the issue, but both pledged to listen to any proposal on the matter.

For more than two years SII's customers have said through the user group forums that they need a product like CE Engineering's Decade 33 software, which makes all functions of SII's venerable Coyote workstation available on a Macintosh or a standard PC running Windows 3.1.

SII's new workstation to replace its old Coyotes, for writing, editing, classified ad taking and pagination, is MTX, which implements most Coyote functions but works only on a PC running OS/2. A new version of MTX to run on both Windows 95 and Windows NT is set for release in December 1996.

Some users say the MTX product lacks certain key features of the old Coyotes and is less than perfect, but a few customers are pleased to use the product and publish their papers exclusively with MTX.

Announcements
In other announcements, Williams said Jack Pritchard, who has been heading sales in North America, now adds the territory of Asia-Pacific.

SII had previously announced that it has the first publishing system OEM agreement with Netscape Communications Corp. of Mountain View, Calif. Company executives elaborated on the agreement in a new product briefing; after the session, Nilan stressed that the new product line contains the entire Netscape suite of products and servers, not only the widely popular Netscape Navigator Web browser.

SII took one step customers greeted enthusiastically -- release of a confidential document outlining the company's current product development schedule and release dates for each item.

At a reception April 21, most delegates crowded into a large room set up as a demonstration area for outside or related suppliers, where they could see products such as CE Engineering's Decade 33 workstation client for SII systems and the Blue Skii Express Quark XTension for SII from John Juliano Computer Services Co. of Decatur, Ga.

On display were two pagination systems capable of receiving files from an SII database: Harris Publishing Systems Corp. of Melbourne, Fla., and CCI Europe of Marietta, Ga.

Other suppliers offering demonstrations included Associated Information Systems International of Auburn, Calif.; Datafleet Ltd. of North Harrow, Middlesex, United Kingdom; Electronic Repair Service & Sales of Rifle, Colo.; First USA Paymentech of Atlanta; Marshall Resources of Scottsdale, Ariz.; MCC Business Services of Rotterdam, The Netherlands, and Mission Critical Technologies of Concord, Mass.

The executive committee of the U.S. group announced that its members would meet only once in each of the next two years, in Washington, D.C., in spring 1997 and Denver in spring 1998.

-- Michael D. Kinerk

From THE COLE PAPERS, May 1996, Copyright © 1996, All Rights Reserved.