June 5, 1995
Mechanicsburg, Pennsylvania
Two Little Guys Wrestle With Giants Over Beloved Idea
(by Tom Petzinger, The Wall Street Journal:
June 2, 1995, page B1)
Reprinted by permission of the author.
 Richard H. Pizzarro and Daniel
L. Harple, Jr.
Here in the middle of nowhere, a couple of young
engineers developed a dazzling technology destined to put
a picture phone in your personal computer.
Soon the bigfoots of the technology world stepped into
their market, outfits with names like Intel and AT&T.
The young engineers might have cashed out for millions
and spent the rest of their lives on the beach. Instead,
they resolved to build a business for themselves in the
market they had fostered.
The nerve.
Today, their company, InSoft Inc., is worth in the
neighborhood of $50 million, and the videophone
revolution has only begun. There is no telling whether
the giants will ultimately crush the company. But InSoft
has made it this far on the strength of two critical
choices.
First, it endowed its product with a distinguishing
virtue in the bastard world of telecomputing: the
flexibility to run on any high-end workstation. Second,
InSoft realized that in going toe-to-toe with giants,
cooperation is preferable to competition.
Central Pennsylvania isn't exactly Silicon Valley. But
as a teenage guitarist, Daniel Harple, Jr. was
accomplished at hard-wiring a rock band. Richard Pizzarro
was writing code for his own computer games before he was
shaving. Ultimately, in 1990, the 2 men were working
together as computer engineers, helping to introduce
computer-aided design systems at an old-line
manufacturing company near here.
They found many of these products maddening to install
and use. Manufacturing engineers, they thought, needed a
hassle-free way of working on the same drawings
simultaneously, from different desks or even from
different cities. And why stop there? Wouldn't it be
something if any number of engineers, while collaborating
on a design, could speak and look at one another without
leaving their desks?
They borrowed some workstations from a sales
representative they knew at Sun Microsystems Inc., snaked
cable through their spare bedrooms and set to work at
night. All night. For months.
They were driven by the demons of the entrepreneur -
the lust not merely to accumulate wealth but to build
something. Mr. Harple had married into a family of
immigrant entrepreneurs from Italy and dreamed of
establishing a business for his children (At age 35, he
has 5.). Mr. Pizzarro, for his part, was the son of a
Puerto Rican immigrant who died of cancer regretting he
had no business to hand down.
After working themselves sick, they quit their day
jobs in 1992 and established InSoft.
Software, it's often said, sells hardware. When Sun
Microsystems saw the razzle-dazzle the engineers had
developed on its machines, it began dragging them to
trade shows from Las Vegas to Tokyo. SunWorld magazine
hailed InSoft's product as a "killer app" for
Sun - "the next logical step in improving computers
as communications devices."
Then disaster struck. Sun introduced its own
videoconferencing software, throwing over InSoft.
"It slapped us right in the face," Mr. Harple
recalls. Although Sun's move validated the commercial
potential of InSoft's product, it also drew more giant
companies into the field. Dan Harple was seized with
migraines.
InSoft resolved to latch on to another major hardware
manufacturer, but this time as more than a tradeshow
squeak doll. Learning that Hewlett-Packard Co. was
planning its own videoconferencing product, InSoft
persuaded the computer giant to use its software instead.
"They're not going to come after us," Mr.
Harple says solemnly.
Before long Digital Equipment Corp. was selling
workstations loaded with InSoft. International Business
Machines Corp. and others soon followed. InSoft, says
William Conners Jr., a company marketing specialist, had
positioned itself as "a mandatory checklist
item" among computer giants.
Then the market,and the stakes, shifted.
"Real-time" videoconferencing had been possible
only on powerful workstations, of the kind found in
engineering offices. When a new generation of souped-up
chips came into widespread use last year, sophisticated
videophone technology became practical in the mother of
all markets: personal computers.
Intent on avoiding a misstep, InSoft moved slowly. It
was beaten to the PC market by PictureTel Corp., a leader
in the ungainly process of whole-room videoconferencing.
Chipmaker Intel Corp. also rolled out a videoconferencing
product for the PC. AT&T Corp., forecasting that
"collaborative computing" would far exceed fax
technology, entered the fray. InSoft found itself well
behind in the market whose creation it had done so much
to inspire.
But InSoft kept its greatest advantage: the
flexibility to run on computers powered by virtually any
chip through almost any species of wire. With InSoft, an
IBM PC running Windows, for instance, can conduct a
videoconference over an Ethernet network with a Digital
workstation running Unix. Or whatever.
Today, InSoft's sales are surging in the PC market,
bringing it closer to the final battle against the
giants: the fight for its share of the low-cost,
high-volume consumer market. The company is sponsoring
visa applications for Russian émigré engineers. It has
opened 8 regional offices.
Mr. Harple vows one day to take the company public,
unless there's some unintended significance in what you
hear when on hold at InSoft: music by the Grateful Dead.
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