As company disappears, legacy continues to Be As company disappears, legacy continues to Be (September 26, 2003)

Mountain View innovator to liquidate after $23 million settlement with Microsoft

By Samay Gheewala

With the announcement of a $23 million antitrust settlement with Microsoft, the story of Mountain View's Be Inc. -- an innovative firm that became a casualty of the software giant's market takeover -- is slowly coming to a close.

Be started developing software in 1990 that presaged many operating system innovations of the past 10 years. Now seen as a company that was ahead of its time, Be was too small to compete with Microsoft and is now on the way to dissolving, even as its technology is used by Palm in many of its handheld computing devices.

"It definitely looks like things should be beginning to wind down," said Be President Dan Johnston, who stepped in to manage the company after it sold the majority of its assets and intellectual property to Palm, Inc.

Johnston wouldn't expand further on the company's current situation, noting that there were still several issues to be worked out, including having the settlement approved by authorities in Delaware, where the company was incorporated. But the final chapters are being written on a classic saga of many '90s high-tech firms.

Founded in 1990 as the use of desktop PCs began to boom, Be followed in the footsteps of IBM's OS/2, a product, which was considered technically superior by software critics but failed to catch on with everyday users.

Be founder Jean-Louis Gassée a flamboyant Apple alumnus, left to found his own company as then-Apple CEO John Sculley embarked on a controversial effort to license the Mac OS to other manufacturers, in an attempt to combat the rising threat of Microsoft.

When Be started, Microsoft had yet to establish itself as the clear leader in operating systems, and its version of Windows was still just an adjunct to the clunky DOS operating system. Be offered a vision of a smooth, efficient graphical interface that would run cheaply on the most advanced technology available.

After a failed attempt at marketing its own proprietary platform, known as the BeBox, Be branched out to offer software to other manufacturers. But it got caught in Microsoft's successful endeavor to virtually corner the home computing market, and was unable to sell its software to a mass audience.

In its lawsuit, Be alleged that Microsoft prevented major computer makers from offering their systems pre-loaded with BeOS, and noted especially difficult episodes involving Hitachi and Compaq.

In the end, Be greatest achievement was to have its software used on the Sony eVilla web-surfing home appliance, and after turning down a buyout offer of $100 million from Apple in 1996, the company sold its assets in 2001 to Palm for $50 millon, although it was in debt for almost as much at the time. Palm has since started integrating features of the Be software into its own PalmOS, used on many popular handheld computers.

With the resolution of the lawsuit, the firm -- which announced its intention to dissolve itself last year -- will begin to disburse its assets remain among creditors and stockholders.

"We're not sure yet how it's going to work, we've got to work out a great deal of the details with our creditors, so I can't say how much of that settlement our stockholders will see," said Johnston.

Software ahead of its time

In a way, Be's software presaged much of the way desktop operating systems have developed in recent years. With its multitasking ability, the software was capable of maintaining several programs in operation at once, a key feature Microsoft was unable to fully implement until its release of Windows 98. And the Be system ran at a then-blistering 64-bit rate, making it a favorite of artists and graphic designers.

One of the most remarkable aspects of BeOS' design was the built-in capacity for multiple processors, well before any manufacturer anticipated the use of multiple processors in PCs. Microsoft and Apple have both recently brought out versions of their own software for dual-processor use, but only after applications like streaming video and desktop video/audio editing had started to establish themselves with mainstream users.

In the early 90s when Be began promoting the ability, however, such applications on home computers were unthinkable, and were usually left to high-priced workstations, such as those distributed by Silicon Graphics, Sun, and HP. Even those computers relied on single, albeit much faster, chips.

Aficionados continue to Be

While the sale to Palm ensured that no new official versions of BeOS would be released, those users who had grown accustomed to the system pledged to push on, and now there are several different open source BeOS clone projects working to produce new versions.

Much like Linux,the latest standard bearer against Microsoft, and its open-source cousin OpenBSD, the latest incarnations of BeOS are collaborative projects among programmers across the globe. The most advanced of the BeOS clones is the Zeta project, run by the German company Yellowtab, which has announced that a final version will be available soon.

So like many innovative technologies, the BeOS has survived the downfall of its progenitor and may yet prove to be a significant player.

E-mail Samay Gheewala at sports@mv-voice.com