Protocol | Enterprise
Your guide to the future of enterprise computing, every Monday and Thursday.
August 16, 2021
Welcome to Protocol | Enterprise, your comprehensive roundup of everything you need to know about the week in cloud and enterprise software. This Monday: Unity's enterprise ambitions, Salesforce's new DEI strategy and Talkdesk shows the call center market is still hot.
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The Big Story
Gamifying the enterprise
Unity is one of the most popular third-party game development platforms. And the lion's share of its revenue comes from selling advertising alongside the creations its developer community puts out in the wild.
But CEO John Riccitiello has a mission to grow the company into an enterprise software powerhouse. The strategy was a central plank of its pitch to investors before its recent public offering.
- Unity is trying to capture the surge in interest in simulation. Within industries like manufacturing, architecture, automotive and retail, companies appear to be increasingly interested in creating digital replicas of their products or facilities to conduct virtual tests, oversee operations more efficiently and make it easier for multiple individuals or teams to collaborate in real time on projects.
- And that's just a sliver of the potential uses for its technology. Riccitiello thinks the demand is so high that enterprise revenue will soon surpass sales from its signature gaming division.
- In five years, "it's going to be common knowledge that real-time 3D technology is an important part of all those industry sectors," he told Protocol. "It is going to pass gaming in that time frame for us."
This tech is still in the early stages. The term "digital twin" has been hyped as a magic bullet to solve many of the industrial world's problems, from sustainability to virtual collaboration. But it's also not yet clear if it will become as ubiquitous as some claim.
- Executives and industry experts acknowledge that digital twins will require a wide range of partners to ultimately make work. Autodesk, Microsoft, Dassault Systèmes and Nvidia, for example, all see an opportunity to capture part of the market, projected to be worth $86 billion by 2028.
- But unlike Autodesk, which sees itself more as a data hub, Unity's software will actually simulate the object. So don't expect Unity to build the next Revit or Photoshop.
- "It would be a disservice to us and others to say that we're gunning for Autodesk or we're gunning for Adobe," said Riccitiello, who grew a bit testy at the line of questioning. "I don't think we will make Autodesk or Adobe go away. There's gonna be a ton of purposes for what their software goes. But we're so different than that."
- It's a similar strategy Nvidia is taking with Omniverse. The company just launched a notable expansion of the product, which it calls the "metaverse for engineers."
Unity already has some fascinating customers. Hong Kong International Airport, for example, manages passenger volumes and other oversight operations using a digital twin on Unity's platform.
- But the company also has ambitions beyond digital replicas of buildings. Unity just purchased remote desktop provider Parsec. While it's used widely within the gaming community, the customer base is expanding.
- And that could give Unity a big footprint into a market that's growing more important as the world shifts to a hybrid work model.
- If an engineer, for example, wants to render a model quickly and doesn't have the ability to do that on his or her own laptop, it can use Parsec's tech to run it (theoretically, at least) from anywhere.
Some analysts have compared Unity's stock to other software heavyweights largely focused on the enterprise — like Snowflake or Okta. But others remain skeptical of its expansion strategy.
- "We would need to see a stronger inflection in these new verticals before we can become more constructive," Barclays analyst Mario Lu wrote in a note in which he cut Unity's target share price from $130 to $90.
Unity has one thing in common with other providers: the direct sales model, mentioned extensively throughout the company's S-1.
- "Leveraging our global reach, we will expand our self-serve and direct sales approach in each region to facilitate further penetration of our existing customers and growth with new customers," the company wrote.
- That aligns its growth strategy closer to a vendor like Atlassian, which expanded in enterprises by targeting end developers, than one like Autodesk that relied heavily on its partner channel.
- "95% of our business is direct with our customers and we operate independently from being bundled," Riccitiello said. "We're not Autodesk or Adobe at scale. We're a fifth, or sixth or eighth their size. But we're growing two or three times faster."
Unity just showed major progress towards becoming a profitable company. And as vendors push to make the metaverse a reality for both consumers and enterprises, the market ahead for Unity and other providers is huge.
- Unity proved it can succeed despite Apple's recent privacy changes. Now, the challenge is continuing to grow the enterprise business amid competition from some of the world's largest and most well-known tech brands.
A MESSAGE FROM TRELLO
After a year and a half of living and working through a pandemic, it's no surprise that employees are sending out stress signals at record rates. According to a 2021 study by Indeed, 52% of employees today say they feel burnt out. Crisis management is one thing, but how do you permanently lower the temperature so your teams can recover sustainably?
This Week On Protocol
'An easy button for privacy': Protocol's David Pierce goes deep with DuckDuckGo CEO Gabriel Weinberg on the company's quest to make the internet more private.
Five Questions For...
Valliappa Lakshmanan, director of data analytics and AI solutions, Google Cloud
Lakshmanan was on our recent list of 10 people defining the new database landscape. Read the whole list here.
What was your first foray into the world of databases?
I built my own. It was a NoSQL document database for efficiently creating, organizing and serving weather imagery in real time. It is still used in production, and if you see radar images of continental-scale areas (such as in airports), you are probably seeing images served out of that database.
What excites you the most about the future of the industry?
Technological barriers to entry keep falling, and that expands what's possible. A key part of the real-time weather database was having to collect radar imagery in real time from [about] 140 weather radars across the continental United States, combine them in real time into a national 3D grid and then serve them to weather forecasters and air traffic controllers.
Fast forward to today. You can go out and buy a global event bus (Cloud Pub/Sub), a global consistent database (Cloud Spanner), fully managed stream analytics (Cloud Dataflow) and a serverless data warehouse (Google BigQuery). The cloud has made it easy to tap into data innovation, making formerly hard things easy. As hard things become easy, I see customers increasingly expand the scope of what they thought was viable.
What's your advice to younger technologists who want to build a career in this field?
Don't stick to one field under a mistaken notion that you have already spent several years working in some area. Grab any opportunity that affords you the chance to learn something new. If you have never done streaming or NoSQL or graph databases or machine learning, and you get an opportunity to do it, grab it.
What's your biggest career mistake or learning lesson?
Early in my research career, I was doing a bunch of small two- to three-month projects and knocking off publications one after the other. But the papers were not very novel, and had very few citations. My mentor sat me down and told me that I needed to do a few large, meaningful things instead. I've always kept that advice in mind. Do I want to do 10 talks/videos or write one book? It's the same amount of work, but the book is more meaningful and has an impact that is longer-lived. Do I make 10 incremental changes, or take longer to solve a meaningful customer problem? How meaningful some work will be in the long term is a framework that I often use to make decisions.
What's the biggest hurdle companies are going to face in becoming a data-driven enterprise?
The biggest hurdle is data culture. Technologically, the journey to becoming a data-driven enterprise is somewhat clear-cut. Many enterprises have been on this journey. However, if you build it, will your employees come? The danger is that you break down data silos, and no one takes advantage. Departments continue to classify all their data as need-to-know. Data quality remains poor. Decisions continue to be made on hunches. Accompanying your technological journey has to be a reimagining of every aspect of how your employees, suppliers and partners work, collaborate, make decisions and measure outcomes.
Around the Enterprise
- Salesforce is taking new steps to make its culture more inclusive for Black women. The move follows the public resignation of two Black female Salesforce employees.
- Talkdesk raised a mammoth funding round, pulling in $230 million at a $10 billion valuation.
- Nvidia revealed it created a simulated version of CEO Jensen Huang for a keynote speech earlier this year.
- T-Mobile is facing a huge data breach that potentially includes the leak of Social Security numbers, phone numbers and other data for over 100 million customers.
Thanks for reading — see you Thursday!