There Was A Time That Was Beautiful
Paraphrasing Charles Dickens, the 1980s were the best of times, were the worst of times. And no, I am not talking specifically about retrocomputing-related subjects, of which we have indulged in past issues of this magazine, but about the more complicated subject of society as a whole. Reaganomics, AIDS, Electropop, Perestroika and Glasnost, Thatcher, Miami Vice, Rubik’s cubes, wars, Stallone, Chernobyl, Challenger, Bhopal, recessions, inflation, Solidarność, Madonna, Black Monday, E.T., Terminator, Olympic boycotts, heavy metal, Lady Di, Michael Jackson; all concepts, words, names that evoke an era mirrored on top of a CRT screen displaying a Lotus 1-2-3 spreadsheet.
Few software products have had more impact in the history of the 1980s and the personal computer than Lotus 1-2-3. It was the spreadsheet that killed VisiCalc (the previous crowned prince) and it would reign supreme until Excel came along, somewhere in the early to mid-90s. Younger generations cannot imagine this, but “Lotus 1-2-3” was the most common software name you would find on the skill list of a résumé in 1985, almost inevitably followed by “WordStar” or “dBase”.
Spreadsheets were, historically speaking, a major game changer. The July-September 2020 issue (volume 42, number 3) of the IEEE Annals of the History of Computing provides a summary of the disrupting capabilities they brought to number-intensive tasks; for example, to financial trading:
First, they achieved new capacities of surveillance. With the help of computers, Milken and his team were able to keep precise track of the movement and location of junk bonds, giving Drexel unrivaled command over the market. Second, they achieved capacities of valuation. High-yield bonds neatly complemented the affordances of off-the-shelf spreadsheet software. (…) Third, 1980s financiers achieved augmented imagination. Adapting the “what if?” powers of spreadsheets, buyout artists (…) built hypothetical models about potential buyout transactions and used them to scan for takeover targets.
(“Michael Milken’s Spreadsheets: Computation and Charisma in Finance in the Go-Go ’80s” by William Deringer)
But we are not interested in spreadsheets or finance today.
Sadly, most reviews of Lotus Development Corporation, the company founded by Mitch Kapor and behind the creation of 1-2-3, tend to focus at the shallow business analysis that begins with the quintessential question: “If Lotus was bigger and wealthier than Microsoft, Borland, Ashton-Tate, and Adobe, what happened?” (Spoiler alert: Lotus was the biggest software company in the world in 1986.)
We are simply not going to answer that question; there are plenty of articles on Forbes, Wired, or elsewhere that clumsily try to answer that with various combinations of market share, advertising, cash flow, or other variables.
As you can imagine, we are interested in a different aspect of the company. See, Lotus Development Corporation was substantially different from most businesses back then (and from many of today), remaining to this day a beacon of hope, a living example of an organization that tried to rethink Corporate America, sprinkling a dash of humanity in an era of savage neoliberalism and deregulation.
This is how Lotus was born: as a company featuring unprecedented benefits for their employees, fostering a culture of radical diversity and inclusion, cleverly mixing dashes of 1960s counterculture with the latest 1980s technology.
Two major names stand out in the creation of this culture: first, Janet Axelrod, who passed away in 2021, and who brought her experience at Digital Equipment Corporation in the areas of diversity and inclusion. Second, Freada Kapor Klein, who was specifically hired with a clear objective:
My job description at Lotus was to make it the most progressive employer in the US. (…) \
It does not get any clearer than that.
I didn’t want to send rocket ships to Mars, but I wanted to have a kind of a workplace where people could be themselves, didn’t have to be somebody else, didn’t have to conform to arbitrary standards.
(Source: Interview with Freada Kapor Klein and Mitch Kapor by Marc Weber, November 2022.)
What other aspects made Lotus’ culture stand out from the pack? The Lotus Grapevine, a feedback mechanism for employees to send anonymous and confidential suggestions to upper management. A Diversity Council with members of management and staff, including gay members. Shuttle buses for staff. A philanthropy initiative driven by employees. In-house daycare. Equal benefits to same-sex partners. Management bonuses tied to employee reviews. Sponsorship of the Boston AIDS walk. Abiding by the Sullivan Principles to avoid doing business with South Africa under apartheid.
And the list continued. The business world, sadly, has erased all of these milestones into oblivion. Instead, as I wrote this article, I watch the news and learn that Google is threatening to fire Swiss engineers who oppose the use of Google Cloud by the Israeli Armed Forces, that Elon Musk has regular secret conversations with Vladimir Putin, and that Jeff Bezos blocked the Washington Post from its traditional endorsement of a presidential candidate.
“Big Tech” billionaires are purposely engaged in the destruction of our planet and our society. They want to rip the true fabric of society and the real source of our humanity: solidarity. All in the name of efficiency, “shareholder value”, and short-term profits.
“Big Tech” has just become yet another corrupt business. We wholeheartedly agree with Ms. Kapor Klein when she says that
It’s pretty pathetic that all of these issues are still important issues and places where companies fail their employees.
And we choose to believe her and her husband, one of the few software moguls who chose not to become another asshole or, as Steve Jobs once described Bill Gates, a person who chose to avoid just being the richest person in the cemetery.
Many a neoliberal analyst will quickly jump to the (wrong) conclusion that the reason why Lotus failed in the desktop office market was precisely because the company focused on humane issues instead of market conditions, cash flows, or other things that (ironically enough) could have been forecasted on a 1-2-3 spreadsheet. They might argue that the same reasoning applies to Borland, a darling pioneer of the same era in the programmer productivity market, and a company that also tried to distinguish itself with progressive policies (and also, another one that was sadly mismanaged into obliteration).
The truth is much more complicated than that. Lotus (and, to a larger extent, also Borland and companies such as DEC and Sun) were absolute pioneers in their fields, and literally had to write the rule book as they traversed uncanny territories. Strategic mistakes were made along the way, and some of those were catastrophic for Lotus.
But we had a very amateurish approach to determining what the next big thing was going to be. Well, let’s try a bunch of stuff. We had theories about it but we weren’t disciplined in a business kind of sense. The market was still maturing, so we could perhaps be forgiven for that. But in fact, one of those experiments turned out to be Notes and that added another number of years to the company’s longevity, so you can’t say that it didn’t work. (…)
Well we also thought literally that WordStar owned the word processing market. That was just a mistake. I made the same mistake again and didn’t think the market was going to get to be 50 times as big as it was. I didn’t do the math. I can’t say anything else other than that.
(Source: Oral History of Mitch Kapor by William Aspray, November 2004, pages 21 and 22)
After Mitch Kapor’s departure from Lotus’ helm at the end of the 1980s, the company fell victim of symptoms common in more traditional Corporate America settings, including the despicable taste of firing lawsuits to companies adopting 1-2-3 user interface elements into their products. Richard Stallman, for one, loudly expressed his disgust on this matter, even picketing in front of Lotus’ headquarters in May 1980.
Most analysis, as mentioned earlier, focus on the “loss” of the spreadsheet market, leaving aside that the release of Lotus Notes unveiled a much bigger one. We are familiar, in our post-pandemic times, with various workgroup software suites, many of them running on web browsers; but 35 years ago these were concepts straight out of a science-fiction book, and for half a decade, Lotus single-handedly owned that market.
Without question, Notes already is the most important business software tool in the new era of client-server PC computing. The Notes market is still tiny – analysts estimate it at less than $200 million this year – but the early lock the software has achieved on key customers gives it spectacular potential. Some 4,000 companies have bought Notes; it has been installed on roughly one million PCs. Sales, this year an estimated 600,000 copies, are doubling annually. (…) These realities have not escaped Bill Gates’ notice. Though he pooh-poohed Notes when it first appeared, Microsoft has launched one of the biggest development efforts in its recent history to build a Notes-buster it calls Microsoft Exchange.
(Source: Why Microsoft Can’t Stop Lotus Notes by David Kirkpatrick, CNN Money, December 12th, 1994)
Let us put the impact of Lotus Notes into numbers: under the orders of Louis Gerstner Jr., IBM performed in 1995 what is called a “hostile takeover” of Lotus Development Corporation, for a staggering (at the time) 3.5 billion US dollars (which equates to 5.8 billion in 2018, or 7.2 billion in 2024, adjusted for inflation). Quoting Gerstner himself,
Lotus had made its name with its popular 1-2-3 spreadsheet software. But what we wanted most, the crown jewel, was an elegant product called Notes–pioneering software that supported collaboration between large numbers of computer users.
By May John (Thompson) convinced me that IBM should acquire Lotus. Thus began the largest software acquisition in the history of the industry.
Gerstner was well aware of the radical differences in the cultures of IBM and Lotus, which he acknowledges a few paragraphs later:
But in the case of a maverick software company, I also had a feeling that the effort to win over the workforce was a battle that had to be won before the first shot was fired. We understood that our every move was going to be scrutinized by the Lotus employees, whose trust we desperately needed to win. (…)
In the end we gained more than a software company. Culturally we proved that we could keep some organizational distance and allow a fast-moving team to thrive.
After the deal was concluded, Lotus Notes became a part of the iconic “Solutions for a Small Planet” ad campaign, with a funny short movie with Buddhist monks raving about it (telepathically) somewhere on the Himalayas.
(Of course, in the meantime, Microsoft caught up. The architect and mastermind of Lotus Notes, Ray Ozzie, would end up taking the Chief Software Architect role from Bill Gates himself in 2006, and would unveil Microsoft Azure to the world in 2008.)
The IBM and Lotus affair lasted for 23 years, with its obvious ups and downs. In 1998, IBM sold the remaining Lotus Notes assets to HCL for 1.8 billion dollars, and even the domino.com domain now points to HCL’s own Domino website.
Lotus 1-2-3 is no more, although the most nostalgic among us can now run the Unix version on Linux. Such an exercise, as gratifying and enlightening as it can be (and as useful, if you need to access old spreadsheets in your latest computer) masks the true tragedy of the disappearance of the Lotus culture. We have lost an example of humane management in a sea of cash and efficiency, and the relationship between society and software is decomposing into an unforeseen (and, in our humble opinion, unnecessary) schism.
The Argentine rock group Sui Generis recorded a song in 1972 called “Canción para mi muerte” (“Song for my death”) whose lyrics are painfully appropriate to describe the times we are living in.
There was a time that was beautiful
And I was truly free
I kept all my dreams
In glass castles
Little by little I grew up
And my love fables
Faded away
Like soap bubbles
It is high time younger generations of entrepreneurs learn about the Lotus culture, and even more important, replicate it. Instead of seeing it as an impediment or a “cost center”, we see it as a conditio sine qua non, a “profit center” that explained much of Lotus’ early successes, and the absolute fanaticism and passion of its staff members throughout time and space.
Cover photo by Clay Banks on Unsplash.