When Mitchell Kertzman, chairman and joint CEO of struggling database vendor Sybase Inc, says he’s committed to turning the company around, it’s hard to disbelieve him. When he sold his own startup company to Sybase four years ago he received a handsome pile of Sybase stock, then trading at $47 per share. But as Kertzman addressed investors at the Hambrecht & Quist conference in San Francisco this week, his shares were worth just $8 each. Not much of a retirement premium, but then Kertzman says he has no intention of rolling over just yet, despite the recent appointment of John Chen as joint CEO (ostensibly to handle the day to day running of the business). Acting in his new role as chief liaison officer to the outside world, Kertzman spelled out his plans for Sybase’s survival in a stagnating database market. We’re looking for the faster moving currents in a slower moving stream, he said. What this entails was spelled out in three stages, albeit not for the first time. Firstly there will be key efforts made to push the forthcoming UltraLite version of Sybase’s ‘Adaptive Anywhere’ relational database management system. This is a 50K, pure Java version that will run on Windows CE. It is designed specifically to be squeezed onto pagers and cell phones. Expect announcements shortly, Kertzman says. Secondly, we’ll see a push into data warehousing and business intelligence based around Sybase’s purchase two months ago of Intellidex Systems LLC, a Massachusetts based data warehouse, data management software company. The first products from this meeting of minds are apparently due out next week. And thirdly, we’ll see more web-based computing efforts, with Sybase relishing the prospect of underpinning the web site for the impending soccer World Cup in France, a site that promises to be the most visited in sporting history. Sybase hopes to raise its web profile through this event. You see, we’re not simply trying harder to do what we did last year, we’re trying to be creative, he said. Presumably not an allusion to the creative accounting at Sybase’s Japanese division which caused such a storm earlier this, forcing revenues to be substantially watered down. Sybase’s last reported quarter was a depressing sight. Losses of $81m and revenues down by 11% in the three months to March; showing that after repeated heavy losses and restructuring charges, the company is still in deep trouble. The last quarter was one in which we went more backwards than forwards, Kertzman admitted. But he argues that turnarounds of this type are not easy to pull off. And just as Sybase was making its recovery, he claims, the slow down in the database market arrived to ruin it all. Conditions aren’t helped by customer confusion and general reticence, caused by what he calls the geopolitical wars currently raging between the likes of Microsoft Corp, Sun Microsystems Inc and Netscape. Confused customers spend less money it seems. But blaming extraneous circumstances won’t pacify out of pocket shareholders for much longer, as Kertzman well knows. He may well tout the stock as being good value because it fails to account for Sybase’s army of highly trained consultants, but this is cold comfort for those already nursing a $40 loss. You can’t imagine anyone in the US who is more interested in increasing shareholder value than I am, were his parting words.
