Live from AEC Systems 2000 in Washington DCSpecial @EC Editionby Ralph Grabowski (Reprinted from upFront.eZine, Issue #204, June 20, 2000, www.upfrontezine.com by permission of the author/publisher) Waiting for the Bubble to Burst
I am hurrying through Concourse B of Chicago's O'Hara airport on my way home from Washington DC. A faux ad catches my eye, and I pull out my digital camera: Xpiredfoods.com
Your B2B Exchange for Outdated Foods.
It could've been the unofficial theme for this year's AEC Systems show. The show had begun Tuesday under sunny skies with an exuberance I haven't felt since the 1986 show in Chicago. That year, attendees crushed the Autodesk booth for a look at AutoCAD, the affordable, open CAD system for drafters keen enough to go it alone. The Computervision and Intergraph hangers-on glared their annoyance at our excitement because we were ushering in a new era - unexpected by us; unwanted by them. That June, 14 years ago, my stay in Chicago was abbreviated by my wife expecting our first child. Fast forward to the year 2000, and my 14-year-old son is accompanying me to Washington DC. And it is us AutoCAD geezers who are glaring at those under-age dot.com-ers -- there are so many of them! -- with their bravado paid for by multi-million dollar investments. Joel Orr counts 170 dot.com firms, and that's the number everyone's using at this show; David Weisburg adds up US$450 million in venture capital invested in Internet-related construction dot.coms over the past 24 months -- a hundred-million for Buzzsaw.com alone. Let me step back, and explain who these "dot.coms" are. They have one thing in common: a Web browser interface, in many cases beautiful works of art. They provide a variety of services, primarily to the construction industry: hosting most aspects of your project; centralizing the bidding process; being the middleman for services, catalogs, and materials; checking for permits from city hall, et cetera. (At the show, I noticed a trend. Established companies, such as American Reprographics and Bluebook, had -- well, let's be frank -- ugly user interfaces on their browser software. The new dot.com-ers had beautiful user interfaces on their browsers. Form over function?) At the Tuesday morning keynote address in Room 40, Joel Orr pronounces: The project extranet industry has been funded on speculation; now they have to survive on profits. How many will crash? And, he adds, these apps are sticky; you are not going to want to switch your projects to another ASP. I find it's not hard to image the nightmare scenario: your project drawings and documents are inaccessible on a bankrupt dot.com's server. In the 24 hours following AEC Systems' triumphant Tuesday morning opening (10:00 a.m., sharp!), a sort of deathwatch descends, though unnoticed by many. I am seeing the extravagant booth prizes - a Ford F-150 pickup truck here, a Harley Davidson motorbike there, three VW Beetles at the end of this aisle, and a dozen Palm Vs and VIIs all about - as a desert traveler sees water wasted. Flush with cash and feeling the impending crush of the herd of 169 competitors, these dot.com-ers are fated to running a desperate race: who can outspend the others in order to buy their way into market dominance? Boys: hang on to your cash; you're going to need it for the tough times coming this winter. Not that CAD companies are immune. Five years ago, Numera blew through its venture funding while creating a Visual CADD that was wanted by too few people. But for awhile they had the money, and their booths were gorgeous, their offices were in the penthouse, their parties wonderful -- to my enjoyment. By Wednesday afternoon, it's as official as it can get. Matthew Phair is moderating a vendor panel entitled "B2B E-commerce for Construction." He is an editor from Engineering News Record, and is expressing publicly what we media have been rolling our eyes over to one another: Tell me in three minutes why I should go with your dot.com. Each of the eight vendor reps is shifting in his (and in one case, her) place, knowing this is the crux of the matter. One after the other, each ceo, cto, or marketing manager trots out their prepared spin. One says he uses the most secure servers in the world, located on three continents (but anyone can rent space on that same server, I am thinking to myself). Another says he has been in business for two years (but next year, everyone else will have been in business for two years). And it keeps on going, one undifferentiated claim for uniqueness after another. Sitting next to me, Construction Business Computing editor Joe Stoddard is muttering, "BS!" There is, in fact, no answer. But not all is doom and gloom. In my Palm III, I record the statement of one vendor rep: "New vendors are pushing established players." There's Autodesk with Buzzsaw.com; Bentley Systems with Viecon.com; Primavera Systems with PrimeContact.com; The Blue Book of Building and Construction with TheBlueBook.com. Later in the evening, I am speaking with Yoav Etiel, vp of marketing at Bentley Systems. His company is putting on a bash for invited guests at the National Press Club. I'm not eating any more; it's my fifth reception of the day. Yoav is asking me, Which of the dot.coms do you see surviving? It's the topic we in the CAD media have been discussing all day, and my answer comes easily: "Buzzsaw, Cephren, and Viecon." (My reasons come later in this newsletter.) Martyn Day ambles by. He's editor of the British CADdesk magazine, and this is my first chance to catch up with him this week. He is telling me of one dot.com started by college students. He had asked them, Surely you are looking to be acquired? Not at all, they had earnestly assured him. "Develop name recognition, and get acquired -- that's what it's all about!" I crow. Afterward, Randall Newton (editor of MicroStation Manager), Tony Zilles (publisher of CADinfo.net), and I forego the free busses lined up curbside, and are walking in the warm Washington night back to our hotels. I am telling them about Martyn's discussion with people who are pretty excited about this year's revitalization of the show; next year's show in Chicago will be even bigger and better! Martyn said they didn't understand that many of this year's exhibitors would not be around for next year. Most dot.coms will be acquired, or run out of money. Indeed, three or four acquisitions were announced during the show, including:
Bidcom acquired Cubus
Bricsnet acquired Viscomm
Revit is partnering with CMD [For photos from Washington DC and the AEC Systems show, visit http://www.upfrontezine.com/travel
The video coverage of the A/E/C Systems show listed last issue should be http://www.designarchitecture.com/aecsystems/]
Top @EC Rumors
When too many journalists get together, they trade stories you never (ever!) get to read about in their publications. We know where bodies are buried, and we don't want to join them. (I hope one day that someone braver than me dares write the book about politics in the CAD industry.) There are, however, some rumors as heard from at least two sources: Rumor: Autodesk was at the show. According to the rumor, Autodesk tried getting a booth at the last minute, but there was no room for them on the exhibition floor (that part can't be true). They instead took a room in the basement of the Washington Convention Center, showing AutoCAD LT and Land Development Desktop (that part's too weird to be true). Rumor: Microsoft was at the show. A journalist walked into the wrong meeting room, and recognized the Microsoft employee as a speaker on a panel discussing the progress of IFC (the IAI's Industry Foundation Classes). This rumor was later confirmed by a Microsoft spokesman, who apologized for not letting me know in time. Rumor: Engineering News Record is unable to hire a junior editor at $50K/year. I first heard the rumor from an editor who had turned down the job because the pay was too low. The rumor was later confirmed by an ENR editor making the job announcement in the media room. Rumor: Of the 170 dot.coms, only three will survive for next year's AEC Systems show, to be held in Chicago IL USA. Why three? That number comes from the survival rate of North American car manufacturers (ha!). The survivors are rumored to be: - Buzzsaw, because Autodesk will pump in as much money as ceo Carl Bass needs.
- Cephren, because they are the most with-it dot.com.
- Viecon, because Bentley isn't a dot.com, and Viecon isn't their main business.
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