BUSINESSWEEK ONLINE : DECEMBER 11, 2000 ISSUE
BUSINESS WEEK E.BIZ -- COVER STORY Q&A with BEA's William Coleman The CEO of the world's hottest Net-software company talks about the tough market and how the software world has changed BEA Systems CEO William Coleman suddenly finds himself looking down at the rest of the world's Internet software companies. BEA, just five years old, is toying with $1 billion in annual revenues. It's profitable -- and it's winning away major banking customers from the biggest tech company of them all, IBM. Business Week Silicon Valley correspondent Jim Kerstetter recently spoke with Coleman about the tough realities of the Internet software world and the secret of his success -- flexibility and a willingness to jump on new technologies. Q: BEA is just five years old, but you've gone through several iterations. You started out doing really complex software to integrate big corporate computer systems, didn't you? A: Yes. We started out as a middleware company in 1995. We were doing the hard, hard plumbing for corporations. Anyone can plumb a two-story house. But it's real hard to plumb the Sears Tower. We were plumbing the Sears Tower. Q: What was the big moment for BEA? A: The big transformation took place when we bought WebLogic. I wish I could say we had a big master plan. We didn't. We've grown up to be more of an adaptive company. We react to the market. Last quarter, WebLogic constituted 70% of license sales. Half of the rest was WebLogic-related stuff. Q: Wall Street is very unforgiving right now, isn't it? A: In the high-tech world at the moment, if you're on the side where your economics are going down, you're getting crushed. The PC guys? There's nothing wrong with PC business. But 20%-to-30% growth is now down to 10% to 20%. The market isn't quite sure if there is going to be a sustainable leader in the new economy.... [The attitude is] since there's noise in the street, you just throw out the baby with the bath water and then wait and see. Q: All things considered, BEA hasn't been beat up quite as much as everyone else. Why? A: In the last few years, the software world has changed. It's a fundamental shift, and it's a very good thing. What's happening is we have spent the last 50 years of IT being on the expense side of the ratio, not the profit side. This is the one point in time that it's about fundamental economics. It's about getting in touch with every customer at zero cost. It's all about taking the dollars out of supply chain and inventory. The fundamental economics in every market are being affected. That's what we're trying to be about. Q: Do you have faith in the dot-coms? A: The bricks-and-mortar [companies] are going to win this thing. It's not going to be the dot-coms. There's going to be only a handful of megacompanies left. Q: So what is this industry all about right now? A: This is all about market share right now. This is truly a gorilla game: In the end, there can be only one. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS The New Software Whizzes TABLE: Software's Brash Upstarts CHART: The Upstarts Are Growing Fast...Boosting Their Stock Performance... TABLE: ...And Winning Buy Recommendations GRAPHIC: i2 Technologies Snapshot GRAPHIC: Vignette Snapshot GRAPHIC: BEA Systems Snapshot GRAPHIC: Ariba Snapshot GRAPHIC: BroadVision Snapshot Microsoft's Little Bro' TABLE: Still King of the Hill ONLINE ORIGINAL: A Hill of Beans That Could Have Buried BroadVision ONLINE ORIGINAL: How E.piphany Gets Them to See the Light ONLINE ORIGINAL: Q&A with BEA's William Coleman ONLINE ORIGINAL: Q&A with Commerce One's Mark Hoffman INTERACT E-Mail to Business Week Online

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