As the former president of Oracle, Lane helped the database and applications company reposition itself to take advantage of the Internet era. Today, as a general partner at Kleiner Perkins Caufield & Byers, he is charged with investing in the software industry's next big thing.
According to Lane, however, he doesn't have a clue as to what that is. What he has figured out is that the software industry -- and its historical focal point, Silicon Valley -- are at a watershed, and that the future is going to be radically different from the past.
It's a future with which Lane is comfortable, based on his reading that at least for the near term, customers will drive improvements in software.
It's a view that he expounded at Oracle until a falling-out with Oracle chief executive Larry Ellison. Today, the post-bubble software industry is beginning to come around to Lane's way of thinking: renovation, not innovation, is what's important.
After a recent speech outlining this vision at the Software 2004 conference in San Francisco, Lane spoke with CNET News.com about the broader implications for the industry, Silicon Valley, software customers and entrepreneurs.
When you say, "our technological progress is our vulnerability," what do you mean by that?
A lot of technology that's been developed and delivered over the last 10 or 15 years is not being used. So every year, a business gets the opportunity to ask, "how are we going to compete?" For instance, chief executive Ed Zander sits down at Motorola and wants to know ways to make it more competitive. Those ways include better information, better systems and better ways of going to market. The biggest challenge to him is in reorganising his systems. Changing those systems is not easy. The more technology we have installed, the harder it is to change your business.
Andy Grove's famous horizontal computing model, designed to take down IBM, was adopted to justify the construction of our current systems architecture. To compete with the vertically integrated IBM, Intel proposed separating each layer of the stack to improve quality and reduce prices. That certainly had its effect on IBM, which had to reduce gross margins from 75 percent to 25 percent. It also unleashed a complex, nonintegrated and difficult-to-maintain stack of software specialisation.
