Notes :: A bitter-sweet analysis

by Volker Weber

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I always need a bit of time to think before I can form my own opinion. Executive summary: it's the best scenario for a Notes endgame.

Notes has been an exceptional success story. There is no other application platform that has lived and prospered for so long. It has pioneered many technologies we enjoy today but it never set the standard for those. Notes was always on its own and has adapted to the changing world around it. And Notes has always polarized. Some people loved it, some people have hated it.

I am writing this in the past tense since Notes has been on the decline for at least ten years. Customers have moved away and the winner is Office 365. Notes applications have proven to be difficult to migrate and the platform will survive in some pockets because of them. One way or the other, revenue from Notes is on the decline for IBM, as it is for many of its businesses. The reaction to the shrinking business is cost cutting. People have been let go at an alarming rate in 2017.

What do you do when you run out of funds to maintain an expensive platform? Nobody is going to give you a budget for a wholesale renovation. Your targets are to maintain as much revenue as you can while spending as little as you can. You aren't even running a cash cow business, since the cost of maintenance is just too high.

Enter HCL. They bring money to the table. They take over your development and support, lock, stock and barrel. Developers get transferred, away from your payroll. And you are making money doing so. Your revenue goes up, your cost goes down. What do they get in return? A long-term maintenance business. They get the know-how to run this business. If they can retain the developers for two years, they can replace them with less expensive people down the road. At this point they already recovered their investment. And to keep the customers from walking, they need to demonstrate faith in the product. If they succeed they will make big profits for a very long time.

That is what is happening now. It's a good endgame. Instead of running Notes into the ground due to lack of funds, you change the business and make it sustainable. This will give Notes a few more good years at its old age.

But it is not a new beginning. If you think it is, you are delusional.

Comments

Notes is DEAD, is a message that has been around since 1997, and it HAS Survived all that time. Well clearly it's not dead, and will continue to bring new stuff to the market.
Some People allways see the negative sides first, and last. Stop being so negative, be glad and chearfull about this. There IS a new future about to unfold for all of us.

I am aware that Management THINKS they can replace notes with something new and cool. But as allways those people are not there for long, and once they get their boni they leave, and what they leave behind is a mess, and usually at a much higher cost.

Notes and Domino do not only have a "few" more good years, they still have the best Return Of Investment, and the best Total Cost of Ownership in the industry.

Next to that, this still is the only product around that COULD do without a virusscanner in the mail client, as IT does not start any viruses by itself. The user has a safe environment in the Notes client. IF they so choose to use that. By using browsers to show domino Information, this (no virusscanner installed) no longer works, and becomes dangerous (so don't even think about it) but then the "user experience" get's something new, and well management just loves that.

Well I still preferr the Richclient, as it offers so much more, and is so much safer.

In the End? We will hear about notes and domino's death for at least 10 more years. Maybe, just maybe in 10 Years it might come true, although I even think that is unlikely. Until then, we, the treehuggers, will continue to love "our" yellow product some more.

Yellow Tree Hugger - Rudi

Rudi Knegt, 2017-10-26 17:41

Volker, I think your analysis of the endgame decision is correct. As for whether this is a new beginning or a new ending is much harder to say. Notes continues to have some real strengths, and it is possible that with new energy and money, the developers and marketers will find new ways to attract customers rather than just holding on to a dwindling supply. It is also possible that the past ten years or so of decline will be unstoppable, though this may push the endpoint out some. (For a number of my Notes admin and developer friends, this would still be huge if it allowed them to stay on the ride until retirement.)

With all that in mind, I'd say I was unable to answer your poll because I think the answer lies somewhere between the two. The "end" would have been if IBM had maintained the path they were going. The "great future" might have been if they had not spent years starving the beast. What we have is a reprieve with some promise that Domino (maybe even Notes) could be revitalized for some sectors or features. That's somewhere in the middle, in the very cautious optimism realm.

Ben Langhinrichs, 2017-10-26 17:53

I think it's a fascinating writhing in the ongoing IBM death throes.

Craig Wiseman, 2017-10-26 19:47

A good endgame needs good players - HCL is not. Their service and dev reputation is low to be frank. And the market moves to specialized applications, preferably web based, despite all Cassandra calls from Mr Knegt in regard of security. Thin solutions ... Domino was a lot but never was or will be a solution with a small footprint ... like the Dinosaurs or yellow tree huger: EXTINCT.

Lutz Haller, 2017-10-26 20:28

@Lutz Haller - what other solution with that amount of features in one box has a similar small footprint than domino ? Using Domino as webdev platform delivers so much more out of the box than any other JEE/LAMP/...god knows what fuckin framework you throw at me. The problem here again is perception. You can build/use thin solutions without any issues here and a lot of people do, especially for security reasons. Not Daimler, maybe not Deutsche Bank, not the banks per se as they used mostly Notes as an EMail Client but a lot of others. Be fair. Don't rate it stuff based on your own perceptions.

Heiko Voigt, 2017-10-27 10:49

Die Zahlen deuten ja schon länger darauf hin dass die IBM bedeutend mehr Probleme hat als die inzwischen relativ kleine Collaboration Sparte.

Wenn die IBM sich nicht ändert wird das eventuell der Markt erledigen, auch wenn das ja eigentlich ein "too big to fail" Konzern ist.

Manche Diskussion erinnert mich immer noch an den Schwarzen Ritter aus Monty Python. In gewisser Weise ist das erfrischend denn es erinnert an früher.

Wobei es am Ende oft egal ist ob ein Kunde zu "dumm" ist ein Produkt zu nutzen oder das Produkt selbst das Problem darstellt.

Henning Heinz, 2017-10-27 14:23

Is this really a money issue for IBM? If it is, why not rise prices? Office 365 certainly isn't cheap either and customers are obviously willing to pay. I cannot believe the costs for keeping Notes / Domino alive are not worth it, compared to the revenue it generates (how many "successfully migrated" companies have really shut down their last Domino server?). Or is it more of a brain drain issue? Anybody with insights on this?

Carsten Lührmann, 2017-10-27 14:49

Thank you Vowe. I was confused when reading the announcement - now I see it clearly.

This change is both a good thing and a sad thing.

ps: I really loved developing on the Domino platform. It was genuinely brilliant and I really did deliver some amazing applications. With this in mind a small part of me remains delusional.

Ian Bradbury, 2017-10-27 14:51

Whether or not you think "Notes is Dead", I doubt your view will have changed after this news. If you already thought Notes was doomed then this is proof you were right; if you thought Notes had a future this is also proof that you were right.

Do you think they're more likely to attract new customers now that they're partnered with HCL? I very much doubt it, I'd like to hear anyone who could justifiably claim it will. So in my mind it isn't going to save or revive Notes - at the best it'll keep it around as legacy a bit longer, at worst it'll finish it off as people give up on it.

Sam Wilson, 2017-10-27 15:52

The latest numbers around Office 365, say a lot also about the direction companies are going:

- Office commercial products and cloud services revenue increased 10% (up 10% in constant currency) driven by Office 365 commercial revenue growth of 42% (up 42% in constant currency)
-Office consumer products and cloud services revenue increased 12% (up 10% in constant currency) and Office 365 consumer subscribers increased to 28.0 million

Source: https://www.microsoft.com/en-us/Investor/earnings/FY-2018-Q1/press-release-webcast

Frank van Rijt, 2017-10-27 16:59

For me, the fact that US tech and business media have basically ignored this story tells quite a bit. I am not sure if that is because IBM hasn't done a formal press release (if they have, I can't find it) or whatnot. No one outside the core existing community is talking about this - and that speaks volumes.

John Head, 2017-10-27 18:21

"Your revenue goes up, your cost goes down." How does this announcement make revenue go up? To achieve that they need to either increase the price or increase the number of licenses sold?

Carl Tyler, 2017-10-27 19:36

I suspect announcing a new Notes version may coax a few extra license renewals or maintenance payments. This really is all about lowering costs to the bone.... have HCL make a few minor changes in the hopes of extending existing contracts and milking the downward revenue spiral to its logical conclusion.

Everywhere I've seen, HCL has competed on the basis of price, not value, and has NEVER been put in charge of anything important. IBM is turning into the CA of software.

Luke Kolin, 2017-10-27 19:41

Sounds like a plan to extend the lifecycle of Notes and Sametime for a few more years, but when you think about the approach, a few questions come to my mind (in addition to what has already been said by some others):

1.) will the developers stay when they are asked to move from IBM to HCL? I think that it will be hard to take over such a huge piece of software without keeping the former developers. Developers get good jobs everywhere these days. The best ones will be gone first. And as other people said before: HCL is not known for better quality, if they replace the developers with their own ones. So, I don't get your argument, Volker, that HCL can deliver at lower cost than IBM. IBM has most people in India anyway. So they could have given it to lower cost developers internally, if it was really about the business case.

2.) does it make sense to split the development between Notes and Sametime on one side and Connections, Verse, Watson AI and the other pieces kept on the other side by IBM? In my point of view, integration is the key and it will only get harder to keep up with the competition with that split. And what will Cisco say about IBM's partnership, when Sametime now gets a refresh? Microsoft and Google both strive by completing their collaboration platforms. IBM is trying the opposite, which I think is the wrong strategy.

3.) New version numbers will not make customers stay, only real innovations will. I witnessed how annoyed Ed Brill was when partners pushed for new version numbers at IBM Connect "meet the developers" session. Ed thought that they don't get it - we are now in a cloud era with continuous updates and version numbers are for legacy on-prem customers. With the move to HCL, customers will only watch more closely which new features will be delivered in the so called "R10".

4.) There is so much more what differentiates IBM's collaboration platform from Microsoft these days, like the whole cloud architecture, so that this can never be a complete game changer.

With that, IBM is now officially showing that they are getting out of the collaboration market. I doubt that it changes much from what would have happened anyhow. It will even destract the developers from doing real work as they will think about their personal development more than developing the product.
I doubt that it will increase profits for anybody except for the competitors.

Bernd Vellguth, 2017-10-27 21:47

@Heiko: I did not question the idea in general to hand over Domino to another partner which is able to earn money with the product but I strongly doubt the chosen partner HCL. Also Domino until today has the oldest Java Container, JRE and Lotus Script/Formula which failed to deliver in scalable solutions. In the past people wanted and needed the Swiss army knife: Can do it all but never very good. Nowadays the demand is for specialized apps / forms / robots ... if this is really progress time will decide. I share you doubts about it but nobody can stop the time.

Lutz Haller, 2017-10-30 14:26

This news is even more sad than watching all the Fortune 500 companies "migrate" to .net and/or whatever chaotic techno-soup they must furiously hobble together to attempt to replicate the features that Domino delivers with zero sweat.

Sad because the effort will likely not address the longstanding requests the community has made over the years.

Sad because it is just another sign of the filleting of this once great American company. First they outsource their PC business, then their servers, then their consulting and finally here we are watching this foreign influenced, focused and led management teams cut backroom development deals with a foreign software firm, with complete ignorance of the innovative spirit that was Iris.

Sad because we know this is not about saving money, but cutting deals. The same thinking that hoodwinks management at a major Notes shop to "migrate" away from Notes & Domino just to make the consulting money while delivering merely half of the required functionality.

Xpages was the worst direction they could have gone. It accelerated the decline. Who knows what terrible idea this new effort will hatch. Let me guess: They will phase out the client, fragment the server into separate products, add facebook and twitter into the Notes kernel, replace the flat file system with sql, and replace the Full Text search engine with google.

What they should do is make a few mobile clients and build on the strengths of the platform (RAD, Flat-file, Security, Languages, Mail & Web Server) and make integration with Office even easier.

Notes is not dead. IBM's management's brains are.

Larry Hammons, 2017-10-30 16:16

Totally agree with your take on this. It may be the most spot on post you've ever written.

Russell Maher, 2017-10-30 19:00

I don't think Notes is so "difficult to migrate". It's a fascinating product that has allowed incredibly flexible and powerful rapid application development. I'm not sure that that this move will bring new blood to the table. I suspect not.

We've started migrating things to SharePoint and the platform is ... okay. It's not as good as notes but it's getting better ... slowly.

We're at the point where migrations to SharePoint don't lose too much functionality and don't require too much coding but the fact is that for many applications, the migration is literally a deconstruct-analyse-rebuild scenario.

These things cost money. Sometimes, when you're dealing with two very different technologies, they cost a LOT of money. Money that businesses aren't necessarily willing to part with.

If it costs significantly less to stay on Domino, then you've now got a whole lot of extra time to plan a migration (and maybe, just maybe there's a chance the platform will take off). If you're already in the process of migrating though, I really can't see a reason to stop.

Gavin Bollard, 2017-10-31 04:22

Great analysis Volker, and what a pleasure to read you again as well as the other pillars whose names I find in the comments, I've been following you for so many years guys, it's a pleasure to find you here.

Coming back to the subject: it's difficult to imagine a bright future for Notes. It will take another decade to decommission the platform which will provide a niche market to those experts who have been able to maintain their skills. But at the end it will either disappear or become another confidential tool like Cliché (the pick/universe database).

Lionel Conforto, 2017-11-07 15:18

I was a Notes/Domino developer going back to release 3, and I was always very excited about the product. But in the last 10 years, I, too, have moved away from it because of its lack of direction and visibility in the marketplace. Unfortunately, this announcement doesn't excite me at all. It's a disguise for more IBM cost cutting of a business that is no longer strategic for them. (Remember Visualizer under OS/2? Same thing happened many many years ago.) I agree with Volker that this is the beginning of the end of Domino as we know it.

Mark Feinman, 2017-11-08 15:57

What could IBM do to get Notes/Domino back on the scene? We all have years of experience in ND and would love to see it springing back into life. Maybe involve some business partners and embed some products with some vision in the next release? Bring in something to make it bold and shiny as it used to be, something to increase its unbeatable ability to boost communication and collaboration, something to foster productivity and ultimately ROI. What could it be? What about Unified Messaging? Any other ideas?

Romano Arnaldi, 2017-11-14 11:27

Like Mark Feinman I've been working on Notes since R3 (pre-IBM acquisition) and spent some time working inside IBM in R5/R6. The problem isn't anything inherent in Domino/Notes itself - the platform has always been streets ahead of anything else it competes with. The problem is the lack of commitment inside IBM. The vast majority of IBMers have never understood the reasons why IBM bought Iris in the first place, they lack the knowledge of what it can do, and they have no desire to acquire this knowledge. IBM's internal organizational structure broke the vast business into four separate entities and Domino/Notes was the orphan that no-one wanted to adopt. So since the late 90s, there has been no cohesive marketing strategy, inadequate marketing budgets, and more and more reluctance to plot a future. That's the main reason why the outside world's perception has been that Domino is dying.

When I read pieces like the bit by Gavin Bollard comparing Sharepoint to Domino, I wince (no criticism of him intended). But the heart of the problem is there is really no valid alternative for the customers, so they take what they can get. And I've been around long enough to remember the old cliche the "no one ever got fired for selecting IBM", but sadly that has now been reworked to read "no one ever got fired for selecting Microsoft".

Now I'd like to inject a positive note. Thinking about finding a solution that would incorporate Supply Chain Management together with ERP into a blockchain environment, my first though is that Domino would be the perfect platform. Anyone else interested?

Henry Kaye, 2017-11-16 21:41

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