The Real Story of Informix Software and Phil White 

By Steve W. Martin

 

Real Story of InformixSilicon Valley has been around only for about sixty years, so it’s still in its historical infancy. The history that has been written so far tends to romanticize the past, focus on the “geeks” who struck it rich, or relegate the Valley to trivia. For example, you probably have heard about David Packard’s legendary Palo Alto garage, known as the “birthplace of Silicon Valley.” Most certainly you have read about Larry Ellison, Steve Jobs, Jerry Yang, and the other high-tech billionaires. You may even know that the late Stanford University professor Fred Terman is the answer to the trivia question, “Who is the father of Silicon Valley?”

However, history is a collection of remembrances, and none of the existing writings accurately represent my Silicon Valley experience. I think this is due in part to the writers’ motivation for recording the Valley’s history in the first place. Some scribes have been zealous journalists in search of a career-making scoop. They sensationalized reality. Others were industry insiders who wrote to proliferate their ideas, expound their technology, or promote their company. They edited reality. And finally, some have been disenfranchised columnists who never worked for a high-technology company. Their purpose has been to denigrate the world’s epicenter of wealth creation. They never truly experienced the reality of Silicon Valley.

My reasons for writing The Real Story of Informix Software and Phil White do not fall into any of these categories. First, I wrote this book to explain the incredible events surrounding the rise and fall of what was once a great company. Second, I wanted to record a unique chapter in Silicon Valley history between 1991 and 1997--the period after the technology recession of the late 1980s and before the Internet boom shifted into high gear in the latter half of the 1990s. Third, this book is a remembrance of a unique time in Silicon Valley. We worked there with the hopes and dreams of making our marks on the world during a time frame that can be best described as California’s second gold rush. While the environment was challenging and success was never guaranteed, back then we felt we had a fair chance of striking the “mother lode.” We felt that we were taking part in history, not merely trying to survive and make a living like today. Finally and most importantly, history repeats itself and many of the business and sales strategies that enabled Informix to survive and succeed in similarly tough times and a hypercompetitive market are directly applicable today.

 

Overview

The Real Story of Informix Software and Phil White chronicles the meteoric rise of Informix Software, how it became a billion dollar software giant, and the scandal that ultimately led to its spectacular fall. In 1991, Informix was just one of many database suppliers in a market that included companies such as Sybase, Ingres, Unify, and Progress. Together, they were competing against Oracle, the eight-hundred pound Gorilla. In only four years, Informix was able to challenge Oracle’s dominance, moving past all these other companies in the process. This was a truly remarkable feat and many of the sales, marketing and product strategies that enabled Informix to survive and succeed in tough times and a hypercompetitive market are directly applicable today.

As president, CEO, and chairman of the board, Phil White and Informix Software were synonymous. At the height of his popularity he was recognized as one of Silicon Valley’s most brilliant business leaders. This fascinating behind the scenes book offers an insider’s perspective on the business strategies that succeeded, the products that failed, and how a technology industry titan ended up in jail.

1980 -- Informix is founded by Roger Sippl as Relational Database Systems Inc.
1986 -- The company conducts an initial public offering and changes its name to Informix.
1980 -- Informix is  founded by Roger Sippl as Relational Database Systems Inc.
1986 -- The company  conducts an initial public offering and changes its name to Informix.
1988 -- Informix  merges with Innovative Software and flounders financially.
1989 -- Phil White  joins Informix as president and CEO.
1993 -- Informix   stock is ranked number one for return on equity in the Silicon Valley Top  150. Informix stock purchased for $32,000 in 1991 low is now worth $1 million.
1994 -- Informix introduces an entirely rewritten database named OnLine Dynamic Server. Phil   White is named Financial World magazine’s CEO of the year for the second straight year.
1995 -- Informix overtakes Sybase as the number one challenger to Oracle. Informix stock is  named the top five-year-performer by the Wall Street Journal. Informix  purchases Illustra, an object-relational database software company, in December.
1996 -- Informix  announces Universal Server, the merging of Informix and Illustra. Phil White   declares war on Oracle, sues the company, and calls it “sleazy.” Phil White  receives NASDAQ’s Legend in Leadership award. Informix posts $939 million in annual sales.
1997 -- Informix misses its first quarter revenue, its first revenue miss in seven years. Informix announces a $140 million loss for the first quarter, and class-action lawsuits are filed. Phil White names Robert Finocchio Jr. president and CEO.   Phil White resigns as chairman. Informix restates revenues by $311 million for 1994-1996.
1998 -- Informix restates revenues for the second time in six months.
1999 -- Class-action lawsuits against Informix are settled for $142 million.
2000 -- Informix acquires Ardent for $880 million. Informix moves its operations from California to Ardent’s Massachusetts headquarters.
2001 -- Informix database assets are sold to IBM for $1 billion. Company renamed Ascential.
2004 -- The Securities Exchange Commission civil case against Phil White is settled. Phil   White pleads guilty to securities registration fraud in the criminal case against him. He serves a short prison sentence at the United States Federal  Correctional Institute at Lompoc, California.

 

Table of Contents

1  Informix Background: 1991 and Before
2  Phil’s War Strategy: 1992
3  Reaching the Summit: 1993-1994
4  Nothing but Database: 1995
5  World War III: 1996
6  A Terrible Year: 1997
7  The Wheels of Justice: 1998-2004
8  Lessons from Lompoc Prison: An Interview with Phil White

 

The Informix and Oracle Billboard Wars

Excerpt from The Real Story of Informix Software
and Phil White

 

In late 1994, in a sneak attack, Informix had rented a billboard on Highway 101, the major freeway directly in front of Oracle’s headquarters (Informix’s worldwide headquarters was a fifteen-minute drive south on the highway). The first billboard message was an announcement for an Informix user conference. Following the conference, another ad was placed that touted Informix as “The best database on 101.” Oracle employees would have had to drive to work with their eyes closed not to see it. At the time, there was much backslapping in the hallways of Informix that we had one-upped Larry Ellison and fired a warning shot across Oracle’s bow. Now that Sybase had been conquered, the billboards became even more confrontational.

The “billboard wars,” as they were known in Silicon Valley, would continue for three years until Informix’s collapse in 1997. They were a frequent topic of media coverage in the local newspapers and industry magazines. It seemed the press was more interested in our billboards than our products, as reflected in a BusinessWeek article. “Phillip E. White, Informix' feisty CEO, says he's paying only $10,000 a month to tell 30 million drivers passing by Oracle each year that Informix has ‘snuck up Oracle's technical tailpipe.’ Plus, thanks to heavy traffic near Oracle headquarters and his sign, ‘Oracle employees get a chance to sit and look at our little jabs,’ he says.”

The press reported that the signs infuriated Ellison. Ellison even called Phil White to complain directly. One billboard showed the inside of a car with the word "Oracle" in the rearview mirror and several dinosaurs walking toward Oracle’s headquarters. The caption underneath read, "Warning: Dinosaurs crossing." The billboards also attacked Larry Ellison personally. In a reference to his affinity for the Japanese samurai culture, one billboard showed a samurai sword broken in two. On one half of the sword was written “Oracle.” On the other half, “Late,” in reference to the Oracle 8 database, which was way behind its promised release date. The caption read, “Maybe the warrior needs a new blade.”

The battle soon escalated into each company’s advertising, and Oracle even parked a mobile billboard in front of Informix's headquarters. Its billboard read, "Informix: The best database company on Highway 101? ... As seen in snail systems." This was a reference to a prominent Oracle advertising campaign that used snails to show the TPC benchmark results of Informix. By now, many at Informix wished the billboard wars had never started. It seemed we had awakened the eight-hundred pound gorilla and it was coming directly at us.

 

Testimonials

"Greed, lies, and the lust for power--The Real Story of Informix Software has got it all. However, the book's real value lies in the author's decision to take the high road. If you don't pick up a wealth of leadership lessons from this story, you're just not paying attention."
Bruce Hadley, Founder, SoftwareCEO.com

"An insider’s view of Silicon Valley that provides great insights on corporate strategy and the long-term consequences of unchecked ego. It should be a must-read in business schools and executive suites."
Bruce Richardson, Senior Vice President, Research, AMR Research

"A riveting tale of how one of Silicon Valley’s venerated leaders slipped over the line from high achievement to disgrace. Phil White will not be the last leader in our industry to follow this ageless story line."
Scott Raskin, President, Telelogic, Americas and Asia

"There are great sales guys and good marketeers; the story of Phil White is about a master of both."
Dave Hanna, Chairman, Tropos Networks

"The Informix story has all the characteristics of a good mystery. Why did the CEO falsify information, why did others go along, and how did they get into this situation?"
Gerald D. Cohen, CEO, Information Builders Inc.

"Every executive team considering an acquisition should read this book first. Don’t fall in love with technology, be careful of what you acquire, and make sure you really need it."
Judith Hurwitz, President and CEO, Hurwitz Consulting