The question was: Do we want to continue to ride the VxWorks horse or expand the range of possibilities by embracing Linux? Our customers were asking for help. Many experimented or tinkered with Linux, but it's not free. There are time-to-market costs. It takes awhile to test it and maintain it and support it. It was a clear mandate to us that someone needed to help them with that.
So if the customers don't want to hand control to Microsoft, why would they want to do that with Wind River?
You want a supplier with a stable platform and product development environment, but (one) that is not going to compete with you, a la Microsoft's entry in the set-top box market. They're not just interested in being a software supplier; they're interested in taking over the business altogether.
Why are you trying to replace the term "embedded software" with "device software"?
Embedded software was incidental and invisible. It was hidden. When you call it device software, you realise it's becoming the brains of the product. You're talking about a much more strategic opportunity.
There's a shift in the marketplace. The time-to-market windows are shrinking, down to nine months from 12 recently. That's shifted customers toward buying software instead of building it. The average OEM — Siemens, Sony, Nortel, Motorola — they're spending 62 percent of engineering money on software. Whether they like it or not, they are in the device software business. It's software that's becoming the key differentiator, not the form factor, not the colour of the plastic.
So does the term show a power grab? A move to give Wind River more prominence?
People didn't care about the embedded industry. Embedded software wasn't viewed as being very important. But it's changing. In five years, there will be 14 billion intelligent, connected devices. Software is going to make these devices intelligent. It's the iceberg principle. What "device software optimisation" does is it shines a light under the water.
And the finances are looking up?
We had our first profitable year in five years. We had the highest cash flow from operations in five years.
What are your ambitions?
I see no reason why Wind River can't get to the next stage, which is a $500m [annual revenue] company with 20 percent operating margins. That's goal number one: to get from a $250m company to a half-billion-dollar company on a subscription-based business model.
