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Autumn 1999
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In a recent 10-Q filing to the US Securities and Exchange Commission (SEC), Ardent Software has revealed that it has decided to cease marketing the O2 object database product line following disappointing sales.
The second-quarter filing (for the period ended 30th June 1999) states: “The decision to discontinue the marketing of its O2 product line was made due to ongoing difficulties experienced by the Company in achieving projected sales and forecasts which indicated that ongoing performance would continue to be problematic and less than originally expected. Accordingly, the Company determined that scaling back this activity and investing funds elsewhere was a more appropriate use of the Company’s limited capital resources.”
Ardent’s involvement with O2 extends back to the pre-merger days of August 1997, when Unidata was preparing to launch its first object-relational database product, codenamed Falcon, created using a blend of the Unidata RDBMS and programming tools from O2 Technology SA, in a client-server model. Within weeks Unidata had announced the acquisition of O2 Technology, the Falcon project was dropped and its features were scheduled to be incorporated into a new line of Unidata-O2 products, destined to eventually replace the Unidata RDBMS.
Hard on the heels of this news came the announcement that Unidata and rival Vmark were to merge, but object technologies were still high on the agenda. The new combined company, Ardent Software, made Object Technologies one of its three core business units, with Data Warehousing and Databases & Tools the others. Data warehousing and object technologies were to be the focus of the new company’s strategy for the future, with revenues from the ‘traditional’ RDBMS side of the business expected to fall to 50% of total over the next two years.
Now, embarrassingly, Ardent is having to walk away from the object-relational market - although there has been no formal press announcement of its intentions to wind down the marketing effort, all but historical references to the O2 product family have disappeared from their website.
It is also having to shoulder a one-time restructuring charge of over $9.8m relating to the discontinuation of the O2 product line, the bulk of which relates to impairment of assets and severance and related benefits. Conversely, data warehousing appears to be booming for them: their second-quarter results (see p8) show exceptional growth in this market, with data warehousing revenues up 357% to $16m compared to $3.5m for the same quarter in 1998, and contributing to an overall revenue increase of 49% over the same period in 1998. Revenues from Ardent’s traditional database markets for the six months to 30th June 1999 remained at around $27m compared to the previous year, and at 55% of the total, shrinking as a proportion of overall income.
It is not yet clear what this decision regarding object technologies means for the Unidata RDBMS, and by extension, for Universe. Without O2 as an evolutionary path towards a “Universal Server”, it is difficult to see how much longer Ardent will continue to support Unidata alongside Universe. Although the two databases still account for a significant proportion of the company’s revenues, that proportion is dwindling, and development budgets for the two RDBMS are shrinking alongside it, by as much as 50% over previous years. In contrast, the budget for Ardent’s line of data warehousing tools continues to grow. This is sure to make many Universe and Unidata users uneasy about the future of the databases they have come to depend on.
Ardent Software LimitedLast Updated: 08December 1999