The Sleeper Of SupercomputersFred Guterl
Despite the leaden skies and intermittent downpours that characterize summer on England's western coast, the Bristol offices of Meiko World Inc. seem more attuned to the sunnier climes and hard-nosed work ethic of California's Silicon Valley. And no wonder. Miles Chesney, the 39-year-old co-founder and CEO, has been deliberately trying to transform the young supercomputer outfit into a bona fide American company--just so it can compete better for U.S. business. Speaking from a cramped cubicle, Chesney sprinkles his speech with Americanisms such as "market space" and "skunk works." Meiko has even moved its nominal headquarters to Boston's Route 128.
The blurring of Meiko's national identity is intentional, notes Chairman David Alden: "This is a global business, and we're a global company." And in mid-July, the company's self-transformation into a world citizen paid off with a $17.5 million contract from the prestigious Lawrence Livermore Laboratory, an Energy Dept. weapons lab in Livermore, Calif. Winning an order from one of the world's most sophisticated buyers of supercomputers puts Meiko in the ranks of better-known U.S. outfits such as Cray Research and Thinking Machines.
LONG WAIT. The Livermore coup also shoots Meiko well ahead of a pack
of other small European supercomputer makers. These companies--Meiko and Parsys of Britain, Telmat, Archipel, and Acri of France, and Parsytec in Germany--all exploit the latest supercomputing design: massively parallel processing. MPP machines, as they're called, employ tens, hundreds, even thousands of powerful microprocessors to deliver more computing power at lower prices than traditional supercomputers. MPP systems remain difficult to program, but they're clearly where supercomputing is headed.
Chesney, for one, has been waiting a long time for the MPP marketplace to blossom. The son of an electronics technician from London's outskirts, he started out managing the computer operations of a small British car-parts company. In 1979, he joined British microchip startup Inmos Ltd., where he helped design the transputer, a microprocessor designed specifically for parallel computing. When he, Alden, and four other Inmos engineers founded Meiko in 1985, they chose a name that in Japanese means good craftsmanship.
Although tiny, with revenues last year of only $18 million, Meiko is already a leading MPP supplier. It has shipped hundreds of its Computing Surface systems, mostly to small European buyers but also to Toyota, Rolls-Royce, and General Electric in the U.S. Most of the machines have been small models, chosen by customers who want to try out parallel processing for the first time. Livermore, though, chose a Computing Surface machine for the ease with which it can run programs originally written for Cray Research hardware. The lab also was impressed by its tenfold increase in performance for the dollar over the Cray, an official there says.
Still, Meiko's European origins mean extra work to win deals in the U.S. and Japan, where Meiko is especially vulnerable to xenophobic lobbying. U.S. competitors for the Livermore deal, for instance, protested that the system Meiko bid was unproven. Press reports then accused Meiko of using its British roots to circumvent U.S. export laws to ship a machine to Israel. Chesney and Alden call the protest "a desperate act" that only confirms their belief that European supercomputer makers compete at a disadvantage to U.S. rivals.
BIGGER POND. Meiko hopes it won't catch as much flak in the less sensitive, but much more competitive, commercial market, where MPP systems seem destined to replace traditional mainframes. While scientific usage accounted for almost all of the $320 million MPP market last year, commercial sales may top $2 billion by 1997, according to consultants Gartner Group in Stamford, Conn. Meiko's challenge is to compete with the likes of such giants as AT&T's NCR unit, ICL, and IBM, which also are tapping MPP's commercial potential. Meiko could get a big boost in nonscientific markets from an endorsement from Oracle Corp., a leading supplier of data-base management software. Oracle is heavily involved in MPP. "Meiko's technology is very competitive," says Gary Smaby, a supercomputing consultant in Minneapolis. "But technology isn't enough anymore. You need sales, marketing, and support--all the things it takes to get companies to buy from you."
That's why Alden is negotiating marketing deals with computer-services firms such as Andersen Consulting and Perot Systems. He tried to raise private financing last spring in the U.S., but a potential deal got nixed when the controversy over the Livermore bid boiled over. Now, Alden is pinning Meiko's plans on a $20 million public stock offering in the U.S. that is scheduled for later this year. With investors still shy of computer hardware companies these days, though, xenophobia may turn out to be the very least of Meiko's problems.
EUROPE'S SUPERCOMPUTER GANG GERMANY -- PARSYTEC -- SIEMENS BRITAIN -- MEIKO -- PARSYS FRANCE -- TELMAT -- ACRI -- ARCHIPEL DATA: BUSINESS WEEK
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.