News Article

Wednesday, August 23, 1995 < Prev Next >

Visio Rides Windows Wave

Visio Rides Windows Wave
Benjamin Benschneider / The Seattle Times

Ted Johnson, Visio co-founder and vice president of product development, alters a company slogan after completing a product for Microsoft's Windows 95.

Seattle-Based Software Maker Comfortable In Microsoft's Shadow

Here's a switch: A software company that willingly shares its technology with Microsoft and helps the Redmond company improve and promote its own products. At a time when Microsoft competitors are complaining more stridently than ever about its dominance, Seattle-based Visio, a maker of software used for diagramming and drawing, is comfortable in the Microsoft shadow.

Visio, formerly called Shapeware, is among hundreds of software companies banking on Microsoft's new Windows 95 upgrade to boost their own fortunes. It has already found a receptive audience among business and technical users who need diagramming software to do reports and presentations. Its "Visio" software program makes the once-tedious process of constructing popularly used objects, including circles, boxes and triangles for diagrams such as flowcharts and timelines, a simple matter of dragging and dropping preformed shapes, called "smartshapes," into documents. Now an upgrade of its flagship product, due for release in two weeks, will ship in both 16-bit and 32-bit versions, the latter offering a 20 percent speed boost to Windows 95 users. Visio's new 4.0 version also will anchor an alluring $195 "5-for-95" bundle of Window 95 upgrades, including Norton Navigator, a file-management tool getting favorable advance notice; Remove-IT, a Windows 95 system enhancement; the popular 3-D game SimCity 2000; and "Using Windows 95," a book by industry veteran Ed Bott.

The upgrade takes impressive advantage of Microsoft's OLE system, a technology that lets users change an annual report's pie chart, for example, simply by altering figures in a spreadsheet linked to the report. Users can create and share organizational charts, timelines, diagrams and other graphics in complex documents and over office networks. A company with $23 million in revenue, 150 employees worldwide and a modest but growing base of 450,000 users might be considered an unlikely candidate to showcase Microsoft's biggest-ever upgrade of Windows. But Visio is used to the attention. The company early on caught the eye of Microsoft Chairman Bill Gates, who has used Visio consistently in his demonstrations of Windows' more powerful features. Somewhere along the line Gates' proclivity earned Visio the moniker of Windows poster child. Visio also has strong Windows-Microsoft bloodlines. Founders Ted Johnson, Jeremy Jaech and Dave Walter helped make PageMaker, a page-layout program, one of Windows' first high-profile applications nearly a decade ago while they were at Aldus. Visio's marketing director, Gary Gigot, came from Microsoft. Former Microsoft executive Scott Oki was an early investor in Visio and sits on its board. None of this ensured Visio's success or guaranteed protection against potential Microsoft encroachment into its market. Even today, "we take nothing for granted," said Johnson. "We don't think for a second that Microsoft rules out competing with us." Similar suspicions led skeptics to discount Visio's chances even before the company officially announced itself as Axon Corp. in a tiny Lake Union office five years ago. Rumblings were of a Seattle-based startup that would put the office whiteboard on a Windows PC.

Great idea. What would stop Microsoft from doing it too?

For one thing, Gates has consistently said that drawing programs represent too narrow a market for Microsoft. A more likely scenario could be a Microsoft purchase of Visio, not as much for its software as its programming talent. "Our dealings with Microsoft over the years had led us to believe it viewed graphics software largely as presentation material," Johnson said. "We saw a lot of other potential in the field." Axon, which went on to rename itself Shapeware before adopting its flagship product's name last May, also believed Windows would dominate the desktop, even though at the time the Macintosh was far and away the leading graphics computer. Windows 3.0's release in May 1990 enabled the Microsoft system to handle larger and more memory-intensive graphics programs far better than previous versions.

With each improvement in Windows, Visio "jumped on the bandwagon early," said Chris Peters, vice president of Microsoft's office-products unit.

"By working on just Windows applications, they don't have a lot of internal discussion about whether to support its enhancements," Peters said. "And they don't have to divide their attention with Macintosh and Unix versions." It also helps that Visio has "smart developers. The types of questions they ask immediately put them out of the bozo category." Microsoft's offering of OLE, for example, was seen by many early on as yet another attempt to make competitors beholden to the Redmond machine. Most were reluctant to incorporate the standard.

Visio quickly embraced OLE and found itself featured in Microsoft demonstrations of the new code. For Microsoft, the benefits were in showing off OLE in something other than Microsoft products, and in implictly demonstrating that companies could work with it without fear of expropriation. "We feel that Microsoft is fundamentally very pragmatic, and if we succeed it's good for them," Johnson said. Peters said that the Visio relationship is rare but could work with any company that "is smart about leveraging a relationship with Microsoft." So far, it's paid off. Visio has risen to the No. 1 spot in the drawing and diagramming software category, with more than 50 percent market share. "Our goal is to be the fourth major application" after word processing, spreadsheet and database categories, said John Forbes, technical products director.

With Gates and the world's No. 1 software company on its side, would anyone bet against it?

The Seattle Times

Source page: http://community.seattletimes.nwsource.com/archive/?date=19950823&slug=2137822