Fwd: Wall Street article on a new Cooperative

Begin forwarded message:
> Avalanche Project
> Is Clearing the Path
> For Tech Cooperation
> April 12, 2004; Page B1
>
> Co-ops have been a fact of life inU.S. agriculture for decades, with 
> farmers banding together to solve common problems. Now, a group of 
> computer chiefs at some of America's biggest companies are trying to 
> do the same thing with technology.
>
> If their Project Avalanche is a success, and it's hard to imagine it 
> failing, it will be the biggest thing to hit the technology scene 
> since open-source software like Linux. And just as with Linux, 
> Avalanche threatens to be enormously disruptive to many of the tech 
> industry's big players.
>
> Avalanche is the brainchild of Andrew Black, head of computer 
> operations at Jostens Inc., the people who make class rings, and Scott 
> Lien, who holds the same post for ePredix, which does employee > 
> testing.
>
> Both companies are inMinneapolis. Three years ago, the two men found 
> themselves in the sort of gripe session common to their line of work. 
> Why, they asked each other, were they writing such big checks to their 
> software companies, but getting so little in return? Why were their 
> in-house programming staffs writing the same sorts of custom programs 
> written at thousands of other companies? If Detroit car makers can 
> collaborate on research, why couldn't U.S. technology users?
>
> The problem, they decided, was an imbalance of power between 
> technology companies and their customers. Project Avalanche is their 
> way of restoring that balance.
>
> Avalanche is a legally constituted intellectual-property cooperative. 
> Companies pay $30,000 a year to become members. They can then donate 
> any in-house software they choose to the Avalanche library, with the 
> project becoming the legal owner of the code. Project members get to 
> use, free of charge, any of the other programs in the library.
>
> While just a few weeks out of the chute, Avalanche already has some 
> impressive sponsors, including tier-one names like Best Buy, Cargill 
> and Medtronic. The group has a board of directors and full-time CEO, 
> Jay Hansen, a former IT consultant. Its Web site is 
> www.avalanchecorporatetechnology.com1. Maybe it will buy itself a 
> shorter URL one of these days.
>
> Mr. Black says most of the past three years have been spent ironing 
> out legal issues to immunize companies from the risks associated with 
> either giving their software to Avalanche or using programs they get 
> from it.
>
> One of the first software donations to Avalanche was from Best Buy. It 
> is a piece of so-called plumbing software called AppTalk that allows 
> programs to communicate with each other. It may not be sexy stuff, but 
> it took Best Buy about 100 programmer-years to write it.
>
> John Schmidt, the Best Buy executive in charge of AppTalk, says his 
> company was willing to give it away because it expects to benefit from 
> the additional improvements made to the program from the others using 
> it. Those improvements could also be donated back to the Avalanche 
> library, a technique common in the open-source software world.
>
> While many of the programs donated to Project Avalanche will work with 
> Linux, it isn't a precondition. Avalanche takes all kinds of software, 
> including programs that work with Windows. Members, says Mr. Hansen, 
> aren't expected to give away any in-house software that gives their 
> companies a unique competitive advantage.
>
> So what exactly is so threatening about this effort to big software 
> companies? Just listen to the plans the men have for the group.
>
> Suppose, says Mr. Lien, that some Avalanche members chipped in money 
> to create custom software to run their call centers? Any other 
> Avalanche member would then be able to use the code -- and wouldn't 
> have to write checks for millions of dollars to Siebel Systems, which 
> makes much of its money on these sorts of programs.
>
> Or, asks Mr. Black, what if Avalanche members collaborated on a 
> foolproof collection of open-source programs that could be used on 
> their corporate desktops instead of the Windows and Office 
> combinations from Microsoft? Mr. Black grumbles about having to pay 
> Microsoft hundreds of dollars a year per employee for programs like 
> word processing and spreadsheets, which he says should be commodities 
> by now.
>
> The men sayU.S. companies have all sorts of talented programmers on 
> staff, and could easily match, or exceed, the quality of the code from 
> the best-known software companies. Their ultimate goal is to allow 
> companies to spend less of their time and money on fairly generic 
> software, much of which brings no specific business advantage, and 
> more working on projects that will bring clear benefits to their 
> business.
>
> Because large corporations like those in Avalanche are the biggest 
> customers of software companies, any shift like this would have 
> enormous repercussions. The last thing any company wants is to have 
> its customers banding together.
>
> As residents ofMinnesota, Mr. Black and Mr. Lien know their snow, and 
> they say the name of their project was carefully chosen. An avalanche 
> isn't only unstoppable, it also either buries everything in its path 
> or carries everything along. Software companies may soon be needing to 
> choose their fate.
>
>  
>
>  
>
> Dr. Costis Toregas, President Emeritus
>
> Public Technology Inc.
>
> 1301 Pennsylvania Ave. NW Suite 800
>
> WashingtonDC20004
>
> (202)-626-2411
>
> cell 301-814-5613
>
> [email protected]
>
>  
>
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>
>  
>