New company wants to set standards for industry use

One might be tempted to think, now that the ink is dry on Apple and IBM’s wide-ranging technology alliance, that the days of speculation are over. But think again.

Despite the media circus around the October 2nd announcement –live from San Francisco, and beamed by satellite around the globe — we don’t know a whole lot more than we did when the news first broke in July.

So, what’s the score? As one industry pundit quipped, “It could be good. It could be bad. It could be nothing.” That’s as good a way as any to organize an analysis of the two firms’ new technology alliance for multimedia. First, the facts as we know them.

THEY CALL IT KALEIDA

Kaleida (as in kaleidoscope) is the name of the newly formed joint venture between IBM and Apple for multimedia technologies and products.

At this point, it’s expected that Kaleida will eventually employ between 200 and 300 people in offices located somewhere in Silicon Valley. Michael Braun, vice president of multimedia for IBM, says the company will start off with 20 or so “hand-picked individuals,” as well as a board of directors that’s split 50-50 between IBM and Apple folks.

David Nagel, president of Apple’s Advanced Technology Group and acting general manager of its consumer products division, says that Kaleida will also select two board members from outside the company. Names of members of the board and employees have yet to be made public.

The stated intention behind Kaleida (it’s tempting to write it “Collida” — as in, “They’re gonna collida with Microsoft …”) is to set and promote common data formats, scripting languages and system extensions that support rich media types, such as video, sound, graphics and rich text. In other words, Kaleida will develop a platform-independent multimedia software architecture and license it to Apple, IBM and the industry at large.

IT COULD BE GOOD …

In theory, Kaleida could prove to be the shot in the arm that media-based technology needs to gain widespread acceptance in a developer community beleaguered by incompatibility between computers and multimedia devices.

The challenge and the opportunity. Nowhere is that incompatibility more evident than in comparing IBM’s and Apple’s multimedia offerings today. Apple’s multimedia focus, which has wavered at best over the past couple of years, has been mostly on creating the underlying tools to allow “roll your own” multimedia productions. IBM, on the other hand, has for years been selling specialized industrial applications for multimedia in training and point-of-sale markets.

The two companies have not a stick of technology in common — no hardware, no data formats, no device drivers, no compression algorithms, nothing. This presents a formidable challenge to Kaleida.

Including the present. Apple chairman John Sculley says that Kaleida’s charter is to be platform-independent and inclusive of operating systems already in use by both companies.

It’s still not clear exactly what will be delivered into joint venture, but Sculley says that to “jump-start” Kaleida’s effort, Apple will license QuickTime and other yet unnamed technologies on a nonexclusive basis to the new venture. (Apple will continue to develop and market QuickTime as an Apple product.)

IBM’s Braun says there’s “no reason” not to bring riff (Resource Interchange File Format) and mci (Media Control Interface), public domain standards codeveloped with Microsoft for data formats and device control, into Kaleida as well.

“We want to be sure that titles already created will still play,” says Sculley. “In the context of architectures, this would mean run-time environments for all existing platforms.” Although there is no direct connection between Kaleida and the other IBM-Apple joint venture for object-based operating systems, called Taligent, Sculley says the intention is to make sure that Kaleida’s charter will be as expansive as possible, and that it will be able to integrate its products easily with Taligent’s OBS (object-based systems) world. “We want to make sure that the bar for multimedia is not set too low.”

Adds Braun: “Kaleida has to address the problems of multimedia developers. To energize applications development, we have to reduce the time, cost and risk. That’s a real problem. And what they’ll be getting is data specs from the two preeminent companies in the market. Whatever they need, that’s what we want to do.”

A single scripting language. IBM and Apple also believe that a single, platform-independent scripting language — a multimedia version of the industry-standard PostScript page description language — could spur title development. “Today’s scripting languages all create platform-specific programs,” says IBM’s Braun. “We think we know how to do this in a way that if the tools — HyperCard, MacroMind, AVC, Authorware, etc. — used Kaleida’s scripting language, the output could run on multiple platforms.”

Braun doesn’t know if today’s already-scripted applications would have to be rewritten to take advantage of the new Kaleida language when it appears — and he doesn’t seem unduly concerned about it either. “Most of the business is in front of us, not behind us,” he says.

Hardware, too? But Kaleida’s charter doesn’t end with software architectures. Despite the promise of combining Kaleida’s multimedia architecture with Taligent’s scalable, object-based operating system and the Apple-IBM-Motorola RISC processor — a perfect setup for a powerful multimedia product line, from consumer player to high-end multimedia workstation — Apple’s Nagel says “You don’t have to wait for RISC technology to have a player.” And in any case, he adds, “Kaleida will not be married to a processor or architecture. It’s primarily a software company — it won’t develop hardware products per se — but it will be involved in developing hardware specifications.”

In other words, it’s quite likely that Kaleida will develop a specification for hardware alternatives to both the Multimedia PC (MPC) and Philips’s Compact Disc-Interactive (CD-I), due to ship this month.

“CD-I was maybe a necessary learning step for the industry, but it would have been a lot more successful in the 1980s than in the 1990s,” says Sculley. “A hardware-defined system is obsolete before it ships. The ’90s are software-defined. Kaleida is looking at an entire architecture to take us out at least 10 years, though its initial products will be more focused to near-term.”

No altruism here. Each in its own way, both Apple and IBM have been trying to make multimedia cheap and widely available on a much broader range of devices, and to remove the confusion about how it’s represented to customers. And both companies believe the multimedia devices of the future will be cheaper, as well as more “sophisticated and interesting,” than MPCs — including desktop machines, portables and consumer devices.

But despite these concentricities, says Apple’s Nagel, Kaleida isn’t about altruism, or about losing competitive edge. “We’re not a service organization,” he says of Apple. “We want to enable new products and to be profitable. As a product guy, [Kaleida] forces the pace of technology and innovation.”

IT COULD BE BAD …

It’s been said that the only thing worse than hate is indifference, and the greatest danger that the Apple-IBM alliance faces is that no one will care about it by the time products are ready to ship.

As we said in an earlier piece on the Apple-IBM multimedia agreement (see Vol. 1, No. 3), even if Kaleida comes off according to plan, almost every title developer in the business is either considering or already developing products to run under the Multimedia PC specification set forth by Microsoft and the MPC Marketing Council. Sun Microsystems is also working on promoting multimedia computing, as is Silicon Graphics with its new Indigo multimedia workstation.

Taking on the MPC. But Sculley is unfazed by the potential hazard. He says multimedia specifications based on today’s standard architectures fall short.

“It’s a lot more complicated than taking DOS and adding technology on top of it and calling it multimedia,” Sculley says, making an oblique reference to Microsoft’s MPC specification. “We have more multimedia technology than anyone and we know that’s not the way to do it. You need run-time versions of an operating system for consumer electronics devices.”

Speaking softly of the future. In addition to pointing out the shortcomings of present offerings from Microsoft and consumer companies such as Philips, IBM and Apple are quick to emphasize that whatever products either Kaleida or Taligent delivers will be compatible with both companies’ present offerings.

There’s at least one good reason for such emphasis. At this critical time in both companies’ hardware businesses — IBM losing market share, Apple gaining market share but losing profit by selling at lower cost — neither company wants to axe themselves out of the next three years of hardware and software sales and development by stressing the future too heavily.

Hence, it is vital that Kaleida deliver some standards earlier than two years from now to be able to capture any appreciable share of mind from developers. Considering the disparity between the companies’ product offerings today, this will be a thorny challenge.

“Pre-competitive cooperation”? Also, there are still some very real questions about whether it’s possible for two competitors to be linked so closely and still maintain their competitive edge — against either each other or the rest of the industry. At the October 2 announcement, every other phrase out of each speaker’s mouth addressed the competition question, which indicates that at least the perception of the problem exists.

“We intend to remain fiercely competitive,” went one version of the stage growl. “Don’t even think for one nanosecond that we’ll back off from competition,” was another presenter’s version. “We will continue to aggressively evolve our own products,” said yet another. Later, Sculley said privately, “There’s one thing I want to impress upon you. We intend to be everywhere.”

But let’s just say that Apple, for example, finds itself riding a wave of popularity at IBM’s expense. Then what happens in those Kaleida and Taligent board meetings, populated even-Steven by IBM and Apple executives? Is it still possible to “cooperate on a pre-competitive level,” as Sculley says? Where do good intentions for the future of the industry go when one company gains a clear lead over the other?

IT COULD BE NOTHING …

The benefits of cooperating at the “pre-competitive level” are clear, both for customers who are tired of trying to make square pegs fit into round holes and for vendors and developers trying to sell products into a world that increasingly requires coexistence.

Of course, if the Federal Trade Commission decides that these joint ventures between Apple and IBM constitute a restriction of free trade, we can forget any benefits coming from Kaleida or Taligent. Even with the FTC’s blessing, history does not make many good cases for the success of such agreements. (Recall Sun’s failed joint venture with AT&T to merge two versions of the Unix standard, a relative no-brainer with clear benefits to both parties, as one example.)

No matter how carefully a venture is crafted, something always can — and usually does — go wrong. How IBM and Apple handle those problems as they arise will decide the ultimate success of the venture.

A good case could be made that, considering the state of the two companies’ businesses today and Microsoft’s growing stranglehold on the industry, neither Apple nor IBM had any choice but to make a move so bold. As the comic philosopher Ashleigh Brilliant says, “I don’t have any solution, but I certainly admire the problem.”

Denise Caruso