Comdisco Availability Solutions

Fallen Pioneer

Comdisco is a very good disaster recovery company but a very bad venture capitalist.

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How did a company which made a name for itself helping others avoid disaster get into such a financial mess? Simple: Comdisco dumped money into Internet plays that went south faster than Butch Cassidy and the Sundance Kid. In one noteworthy example, Comdisco paid $53 million for Prism Communication Services, a high-speed Internet network, in February 1999 and spent another $478 million to build the network before throwing in the towel on the service 18 months later. Comdisco’s venture arm didn’t fare any better, making investments in loser companies like the now-defunct

Nicholas Pontikes, the founder’s son, paid the price for this irrational exuberance. Named Comdisco’s chief executive in January 1999, he was ousted in December 2000. Norman P. Blake, who served a controversial 10-month stint as the U.S. Olympics Committee CEO, has since served as Comdisco’s chief executive; his main job now appears to be dismantling the company.

That Comdisco’s disaster recovery business is a quality operation is evident in the fact that it remained profitable even as the company as a whole was crumbling. Satisfied customers say Comdisco offers conveniently located recovery centers and acquires the right hardware and infrastructure to re-create their sites. “Comdisco made bad business decisions, but the disaster-recovery side is a solid piece of business,” says Lou Fournier, director of systems administration with P&O Princess Cruises.

The fate of Comdisco’s disaster-recovery business is likely to remain uncertain for the next few weeks as the government looks into antitrust issues of a combined SunGard-Comdisco operation. Such an operation would reduce the number of major disaster-recovery companies from three to two—a possibility that’s a bigger concern now than pre-Sept. 11. “If there’s a regional disaster like the World Trade Center and all of the banks are signed with SunGard, SunGard will not be able to accommodate everybody,” says Giga analyst Julie Giera. She predicts the Federal Deposit Insurance Corp., which regulates banks, may try to halt the deal. HP is waiting in the wings.

6111 North River Road, Rosemont, IL 60018
(847) 698-3000

Ticker: CDO
Exchange: NYSE
Employees in Comdisco Availability Solutions: 1,300
Comdisco, as a Whole, Has: 3,500 employees

John Jackson
President, Comdisco Availability Solutions
A 17-year veteran of Comdisco, he previously founded and managed an IT and disaster-recovery consulting practice, and consulted for KPMG Peat Marwick. He has a B.A. in business management from DePaul University in Chicago.

Allan Graham
President, Web availability solutions

Paul Sullivan
SVP, product management and sales support

Martin Goulbourn
SVP, field operations

Ann Pickren
SVP, professional services

Bill Robbins
Chief operating officer

Damian Walch
SVP, professional services


Industry specific solutions; business continuity benchmarking, program management, incident command system and lifecycle services; technology migration services, IT availability including rapid recovery, electronic vaulting, disk mirroring and database shadowing, call center services, WorkArea continuity, Mobile Services, Ground Zero for disaster response and recovery, continuity software, consulting services.

Reference Checks

GMAC Residential Mortgage
Mark Kern
Vice president, corporate contingency planning and security
(215) 682-1000
Project: Data-center hot sites for IT group and workspace-recovery. “We’re right outside Philadelphia, and a lot of companies here subscribe to SunGard,” he says, explaining why he opted for Comdisco and its New Jersey facility. “If I were a SunGard subscriber and there were a regional disaster, there’d be a lot of companies calling in the SunGard location in Philadelphia.”

P&O Princess Cruises
Lou Fournier
Director of systems
(323) 463-0664
Project: Primary hotsite recovery in Cypress, Calif., with access to additional facilities in Carlstadt, North Bergen, N.J., and Seattle.

International Flavors & Fragrances
Jim Aschenbach
Disaster recovery
(212) 765-5500
Project: Hot-site recovery for manufacturer of flavorings and scents with operations in more than 40 countries.