Shortly after I published my SGI Special Edition Podcast, I was contacted by a former SGI Engineer (who preferred to remain Anonymous) with several stories to tell of what happened to SGI. It’s an amazing story full of minor hardware glitches that wound up costing millions, bone-headed oversights during acquisitions, and basic mismanagement of a billion dollar company. The story is far too long and involved for a single post, so I’ll be adding it in chapters over the next few days. So come on inside and witness the saga of what really happened to SGI over the years.. The story has never been told, until now. We’ll begin at the Top:

Chapter 1: Management

Chapter 2: The Acquisitions

Chapter 3: Hardware Problems

Chapter 4: False Starts

The history of SGI is ripe with failed endeavors to drum up PR and interest.  In this chapter we investigate some of the smaller technologies and companies that SGI failed to get off the ground.

1. The Wardrobe

One thing to note when talking about SGI’s hires and acquisitions is the amount of money SGI spent on internal “gifts” to employees.  SGI employees were fond of the saying “It’s not a job, it’s a wardrobe”.  Every employee was inundated with t-shirts, jackets,  polos, bags, and more swag than they could possibly deal with.  Customers as well found shirts and coffee mugs a standard staple of anyone buying a system.  Few people, however, realize the lengths that SGI went in order to keep their employees in the “latest fashion”.

Our insider has send us a picture of a beautiful Tag Heuer sports watch valued $1100, that was given to every employee as a bonus one year.

SGI's Custom Tag Heuer Watch

1995 was the same year that SGI acquired Alias and Wavefront Research. [1]

2. WAM!Net

In 1998, SGI sealed a deal with up-and-coming WAM!Net [2] that would make SGI the sole provider of WAM!Net hardware and give them an 8% stake in the company, and obligate WAM!Net to purchase a minimum of $35M worth within the next 2 years. [3]  SGI paid $75Million and gave up their $40M Eagan, Minnesota campus for the deal.

The combination looked promising, and from reports from SIGGRAPH1999 were positive: [4]

At the show, WAM!NET and Alias announced co-marketing and sales to the installed base of Maya users. That collaboration might be expected, since SGI that partnered with WAM!NET to create the rendering service. SGI created the custom cluster of servers that ROD! employs, pulling together hundreds of MIPS processors to build the renderfarm. Chris Landreth, Alias’ in-house artist-and the creator of that Siggraph favorite, the malicious Bingo the clown-began rendering with ROD! in September on his latest production, A Trip to Renee’s House.

So Alias makes the render software, WAM!NET provides the distributed software, and SGI provides the hardware.  A complete all-in-one solution, right?

WAM!Net eventually begin to spread out into encrypted content delivery services, offering their services to the recording industry (secure transmission of music over the internet, instead of via CD), medical industry (a solution to HIPAA concerns), and the US Military. [6] WAM!Net was acquired by Savvis one year after the conclusion of the agreement, in 2003, for $16million.  [5]  Now, it’s nowhere to be found.

3. ParaGraph & Cosmo

In 1997, SGI acquired ParaGraph, a tiny 3D Internet software developer, for an undisclosed sum. [7]  The move was a step toward cementing SGI’s hold on VRML and further the rollout of “Cosmo”, their web-based VRML Viewer plugin.  ParaGraph developed tools for building VRML environments, and SGI’s Cosmo allowed users to view and interact with VRML environments.  After the acquisition, the Russian-founded company was relocated to Mountain View and integrated into the Cosmo Software division.  Even before this Cosmo was the #1 VRML viewing application in deployment, and this made it even more so.

Unfortunately, the tide began to turn for SGI shortly afterwards when the stock price tumbled and the CEO (Ed McCracken) left the company.  With the problems VRML was experiencing from incompatibility and external vendors, the entire Cosmo division was shut down in an effort to save money.  [8]

4. Microsoft’s Fahrenheit API

In the 1990’s, if you wanted to do high-speed interactive 3D, you used OpenGL.  Everyone accepted it, and things were good.  Microsoft, however, in a classic “extend and embrace” maneuver, implemented OpenGL in WindowsNT3.5 in 1994 to poise the system as a workstation-class operating system suitable for CAD design.  In a surprise maneuver, Microsoft purchased RenderMorphics in 1995 to get their “Reality Lab” product which they renamed as Direct3D 3.0.  Microsoft began pushing software developers to use Direct3D instead of OpenGL, and the first graphics API war begin.

Fahrenheight Architecture

SGI was already working on a higher-level API library for OpenGL called OpenGL++, but it was stuck in the ARB.  In 1998 announced that they had abandoned OpenGL++ in favor of a new system named “Fahrenheit” that would be developed by both SGI and Microsoft, borrow the best of OpenGL and Direct3D to create a single unified rendering library to work on both systems.  SGI devoted all their efforts at developing their end of the project, “Fahrenheit Scene Graph” and “Fahrenheit Large Model”, while Microsoft began work on their side “Fahrenheit Low Level”. [9]

In 1999, it became obvious that Microsoft really had no desire to see Fahrenheit succeed.  While “officially” they were developing it, they had no engineers actually writing code for it.  SGI spent years developing the necessary software for it, only to have Microsoft release DirectX7.0 in 1999.  By 1999, SGI’s MIPS workstations were lagging significantly behind the offerings from Intel and others, and they were stuck playing catch-up.  [9]

But while SGI internally spent millions of dollars and man-hours on failed technology, they also devoted significant resources to Public Relations and Publicity ventures that never went anywhere.

• Be sure to come back and see the final chapter Chapter 5 : PR Flops .  You can follow the entire series via the sgi-bts (behind the scenes) Tag.

References

[1] FTC Statement on the SGI/Alias/Wavefront Acquisition – 1995

[2] Preferred Provider Agreement

[3] NYTimes – SGI to buy stake in WAM!Net – March 9 1999 (Google Cache)

[4] Digital Content Producer – Impressions of SIGGRAPH: Standouts from the Show Floor – Oct 1 1999

[5] Network World – Savvis to acquire WamNet 08/01/2003

[6] EContentMag – WAM!Net – Private Pipes for Electronic Media

[7] CNet News – SGI to Buy ParaGraph – May 14, 1997

[8] The Rise and Fall of VRML – Part 2

[9] Wikipedia – Fahrenheit Graphics API

[10] API’s of the Fahrenheit Initiative – SIGGRAPH 1998

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