Santa Cruz Operation
The Santa Cruz Operation, Inc. was an American software company, based in Santa Cruz, California, that was best known for selling three Unix operating system variants for Intel x86 processors: Xenix, SCO UNIX, and UnixWare.
SCO was founded in 1979 by Larry Michels and his son Doug Michels and began as a consulting and Unix porting company. An early involvement with Microsoft led to SCO making a product out of Xenix on Intel-based PCs. The fundamental insight that led to SCO's success was that there was a large market for a standard, "open systems" operating system on commodity microprocessor hardware that would give business applications computing power and throughput that previously was only possible with considerably more expensive minicomputers. SCO built a large community of value-added resellers that would eventually become 15,000 strong and many of its sales to small and medium-sized businesses went through those resellers. This community was exemplified by the annual SCO Forum conference, held in a scenic setting that reflected the company's Santa Cruz culture. SCO also had corporate customers in the replicated sites space, where a SCO-based system was deployed in each of a retail or restaurant chain's stores.
Despite seeing rapid growth in terms of revenues, SCO tended to have high research and development costs and was never consistently profitable either before or after going public in 1993. SCO bought two former Xenix outfits, the Software Products Group within Logica in 1986 and HCR Corporation in 1990, thereby gaining development offices in Watford, England and Toronto, Canada. During the mid-1990s, SCO acquired two further UK companies, IXI Limited in Cambridge and Visionware in Leeds, which led to a suite of client-to-Unix integration products and then the Tarantella product line. SCO's operating system technology moved from Xenix to System V Release 3 as reflected by the products SCO Open Desktop and SCO OpenServer. In 1995, SCO bought the System V Release 4 and UnixWare business from Novell and, in collaboration with several hardware partners, the New Jersey development office it gained in the deal led a series of enhancements to the UnixWare product aimed at the high-end enterprise and data center spaces.
Beginning in the late 1990s, SCO faced increasingly severe competitive pressure, on one side from Microsoft's Windows NT and its successors and on the other side from the free and open source Linux. In 2001, the Santa Cruz Operation sold its rights to Unix and its Unix divisions to Caldera Systems. After that the corporation retained only its Tarantella product line, and changed its name to Tarantella, Inc. Caldera Systems became Caldera International and then changed its name to The SCO Group, which has created some confusion between the two companies. The company described here is the original Santa Cruz Operation. Although generally referred to simply as "SCO" up to 2001, it is now sometimes referred to as "old SCO", "Santa Cruz", or "SCO Classic" to distinguish it from "The SCO Group" to whom the U.S. trademark "SCO" was transferred.
Early history
Origin
SCO was founded in 1979 in Santa Cruz, California, by Larry Michels and his son Doug Michels as a computer consulting company that focused on both technology and management considerations. Larry Michels, 48 years old at the time, was an electrical engineer who had gone into the aerospace industry in Los Angeles. He had then founded a credit verification company, Credifier Corporation, which he sold to TRW Inc., for whom he subsequently served as a vice president for ten years. Towards the end of that time, Michels became head of the Advanced Products Laboratory for TRW Electronics, and relocated to Santa Cruz to run it remotely from there.As part of this, Michels was involved with a telephony business, TRW Vidar. This was a company, based in Mountain View, California, that TRW had acquired and that was a part of TRW Electronics. TRW Vidar was a pioneer in digital telephone switches, and also an early user of Version 6 Unix in its development environment. Michels felt that TRW as a whole did not understand the rapid change that computers were bringing to businesses or what it had with Vidar – "They thought they were buying a telephony business, they thought that telephony was telephony, but they really were computers. Unless you approached them as being computers, you didn't end up with anything." He then left TRW to do management consulting work, thinking, as he later said, that "if TRW was having so much trouble, it was probably an interesting business go about making these transitions." As a result of this connection, some have considered The Santa Cruz Operation to have been an offshoot of TRW Vidar.
Doug Michels, 25 years old at the time, had graduated from the University of California, Santa Cruz in 1976 with a degree from their department of computer and information science. He had then started his own consulting operation, focusing on technical work.
The two saw some commonalities in their consulting endeavors and decided to join forces to reduce overhead. They chose to stay in Santa Cruz both because of the relaxed lifestyle there and because the university would provide a ready supply of technically suitable employees. By some sources The Santa Cruz Operation, Inc. was incorporated in January 1979. The name came from Larry Michels' time as head of the TRW advanced research group, when the remote outpost had been known as 'the Santa Cruz operation'. The Michelses decided to use that for the name of their new firm, and the name was retained in the years that would follow because it told people where they were coming from.
Unix porting company
Offices for the new firm were established at 500 Chestnut Street in the downtown area of Santa Cruz. But as Doug Michels conceded in a 2006 interview, in terms of what they would be doing, "We didn't really have an idea." Pure consulting work held little ongoing appeal, and the notion of helping large businesses manage rapid technological change proved difficult in practice.However, the Michelses soon became intrigued by the microprocessor revolution then underway, in which computer systems based on processors such as the Intel 8080 or the Zilog Z80 could be put together much quicker than the minicomputers of the past. In the consulting work they did, SCO was dealing with various resellers and small time-sharing companies in helping those companies formulate their technology strategies. The people at SCO had, and further acquired, a familiarity with the Unix operating system and its potential for use in the business world. By early 1981, SCO was selling a report analyzing Unix features and availability based on a poll it had taken of over sixty members of the /usr/group association.
Moreover, people at SCO realized that since Unix was portable and not controlled by any hardware manufacturer, use of it could allow microprocessor-based system manufacturers to avoid having to develop a proprietary operating system of their own, which they had neither the time nor the expertise to do. Accordingly, the company decided to focus on custom jobs of porting the Unix system and applications that ran on it. Eric S. Raymond, in his book The Art of Unix Programming, calls SCO the "first Unix company", although Interactive Systems Corporation, which put out the first commercial Unix release in 1977, perhaps has a stronger case.
The first Unix-based operating system that SCO made is for the PDP-11, is named DYNIX, and is based on Seventh Edition Unix. It supports the Tymshare service and by early 1981 was included in Tymshare's DYNASTY computer system offering. SCO also did a Unix port to the LSI-11 variant of the PDP-11.
Xenix is a Seventh Edition Unix-based version of the operating system that Microsoft worked on, initially for the PDP-11. SCO first began working with Xenix in 1981. In 1982, Microsoft and SCO forged a joint agreement for development and technology exchange, with the two companies' engineers working together on improvements to Xenix. Microsoft and SCO then further engaged Human Computing Resources in Canada, and the Software Products Group within Logica in the United Kingdom, as part of making further improvements to Xenix and porting Xenix to other platforms. In doing so, Microsoft gave HCR and Logica the rights to do Xenix ports and license Xenix binaries in those territories.
In 1983, SCO made a technically difficult port of Xenix to the unmapped Intel 8086 processor and licensed rights from Microsoft to be able to ship its packaged Unix system, Xenix, for the IBM PC XT. This work takes advantage of earlier porting and compilers work that Altos Computer Systems had done for the mapped 16-bit Intel architecture. The resulting system is binary compatible with, and can run applications built for, Altos Xenix systems, and was a successful venture for SCO.
Image:Apple LISA 2.jpg|thumb|right|Museum label for the Apple Lisa notes that it could run Xenix; that was SCO's first shrink-wrapped product.
Somewhat in parallel with that, SCO and Microsoft also developed the 68000-based Xenix port for the Apple Lisa. It has multiuser capability as well as support for virtual terminals for single users. SCO also sold applications for Xenix on Lisa, including a Uniplex word processor, the Multiplan spreadsheet from Microsoft, Level II COBOL from Micro Focus, and the Informix database software from Relational Database Systems. While the Lisa was not a success in the personal computer marketplace, its powerful-for-its-price-point processor combined with a relatively inexpensive operating system gave third-party vendors an attractive platform for building systems to compete with minicomputers, and SCO sold several thousand copies of Xenix for the Lisa. This was the first shrink-wrapped binary product sold by SCO, and its sales convinced SCO of the potential of that kind of product.
A third target of SCO's Xenix porting work was the DEC Professional 350. As Larry Michels said in early 1984, "SCO will continue offering custom XENIX adaptions to the large OEM market – the Original Equipment Manufacturers – who make up SCO's established customer base." SCO also sold Unix training.
By September 1983, SCO had around 60 employees and was already expanding into a second office, at 1700 Mission Street in Santa Cruz. While some of SCO's staff had studied computer science, others were coming from backgrounds in linguistics, sociology, psychology, or business.