George Conrades is the former Chairman of the Board and Chief Executive Officer of [Akamai Technologies, Incorporated]. Prior to Akamai, Conrades served as CEO of [BBN Technologies, Incorporated]. Before joining BBN he spent 31 years at IBM, running its U.S. and Asia-Pacific businesses and heading two manufacturing and development groups.^[3]Mr. Conrades currently serves on the Board of Directors of Oracle Corporation,^[4]. He has also served on the Boards of Ironwood Pharmaceuticals^[5] and Harley-Davidson.^[6]

Conrades was also an executive producer of the 2013 documentary film 20 Feet from Stardom, which won the 2014 Academy award for Best Documentary.^[8] He is a Fellow of the American Academy of Arts and Sciences.^[9] He is married to Patricia “Patsy” Belt Conrades.^[10]

Career

Conrades spent his childhood in Youngstown, Ohio, during the 1950s. He planned to become a drummer.

In 1961, he received his B.S. degree in Physics and Mathematics from Ohio Wesleyan University, and received the M.B.A. from the University of Chicago Graduate School of Business in 1971.^[9] He was going to join a rock band after his graduation, but took the position of a sales representative in Big Blue, Columbus, Ohio^{[citation needed]}.

After 10 years at IBM, Conrades got a sales management position in Chicago and inherited the company's fifth largest account, Sears, Roebuck & Co.

In 1971, he entered for the Executive MBA Program North America at Booth. The program provided broad perspectives of business.

The MBA helped Conrades to make a good career at IBM. He took top management positions at IBM for more than two decades. Conrades advanced to the rank of senior vice president and member of the Corporate Management Board. But by late 1980s, IBM faced contest in technological businesses. In 1992, Conrades left his top management position.

Conrades formed a technology consulting firm in the advanced R&D company Bolt, Beranek and Newman (BBN). The company was based in Cambridge, Massachusetts. BBN became an early internet service provider.^[11]

Epilog by David Walden

[...] The first section of this epilog continues from the point of Steve Levy’s section 6.6 discussion of BBN in the 1990s. That section, which starts on page 116, sketches the BBN transitions from the arrival of George Conrades as BBN CEO until the 1997 sale of BBN to GTE.1 The second and third sections of this epilog provide a more general picture of how BBN changed between 1997 and 2010.2

22.1 Changes in ownership

BBN under George Conrades as president and CEO invested heavily in expanding the market share of its Internet business, BBN Planet. This was in the era of the dot com boom. In time the need for continued investment in BBN Planet resulted in the sale of BBN to the telephone company GTE which wanted to be in the Internet business. In the two years following GTE’s June 1997 acquisition of BBN, GTE continued to operate BBN Systems and Technologies (the contract R&D business) and BBN Planet as separate businesses, investing over $1 billion in growing BBN Planet.

In the spring of 1999, as part of the continuing consolidation and evolution of the communications industry, GTE and Bell Atlantic announced that they had agreed to merge their two companies (in other words, Bell Atlantic acquired GTE). However, Bell Atlantic was one of the Regional Bell Operating Companies (RBOCs) that resulted from the historic breakup of AT&T Corporation and was forbidden under the terms of the breakup from being in the “long-distance service” business. BBN Planet’s Internet business was deemed to be a long distance business by the Federal Communications Commission; consequently, prior to effecting the merger with GTE, Verizon had to relinquish control of BBN Planet.3 Verizon accomplished this divestiture of control by allowing BBN Planet to sell $2 billion of its shares in the public market. The resulting public company was named Genuity. 4

At the time of Genuity’s IPO in the summer of 2000, BBN Technologies5 continued to operate under its own name as a wholly owned business unit of Verizon Communications. Then in February 2004, BBN Technologies became a privately held company again, having been acquired from Verizon by private investors (primarily Accel Partners of Palo Alto, California, and General Catalyst Partners of Cambridge, Massachusetts) and the management of the company. In October 2009, the 2004 investors cashed out of their investment, selling BBN to Raytheon for $350 million.6

22.2 The classic BBN culture and business

Not surprisingly, when George Conrades came to BBN as CEO, he brought in new senior managers (see Figure 6.11) with skills he didn’t see in traditional BBN managers, many of whom had come up through the technical side of the company. In particular, the position of Frank Heart (see https://en.wikipedia.org/wiki/Frank_Heart) had as president of BBN Technologies was taken over by David Campbell ( https://en.wikipedia.org/wiki/David_N._Campbell ) who came from an executive position outside of BBN.8 Campbell brought in additional key managers from outside BBN, reorganized BBN Technologies, and in general worked on redirecting BBN Technologies’s business in ways he thought appropriate.

[ See The President's Commission on Critical Infrastructure Protection (PCCIP) ..

"AUG 25, 1997", Clinton also appointed Charles R. Lee, chief executive officer of GTE Corp. of Stamford, Conn., David N. Campbell, president of BBN Technologies of Cambridge, Mass., and Elvin Moon, president of E.W. Moon Engineering & Construction Management Industries of Los Angeles, to serve on the team advising the President's Commission on Critical Infrastructure Protection (PCCIP). " ]

When BBN was acquired by GTE in June 1997, David Campbell became a senior executive of the GTE Technology Office, managing GTE Laboratories and a few other GTE held activities, and still personally managed BBN Technologies. Campbell did the job he was assigned and tried to fit BBN Technologies into the GTE culture and organization.

As a result of such reshaping—and the prior emphasis within BBN from 1995 to 1997 on exploiting BBN’s Internet activities and changing BBN Technologies’ business direction—BBN Technologies’ traditional research and development business suffered. Many good researchers and managers left, and for several years the company did an insufficient job of recruiting the potential stars of tomorrow.9

Nonetheless, a number of influential BBN Technologies old timers (and an influential consultant) were committed to preserving the “classic” BBN culture and business. They were able to convince David Campbell that BBN Technologies needed its own dedicated leader. In the first half of 1998 a committee consisting of one long-time, senior BBN person and two outside people who knew BBN Technologies’ traditional strengths undertook a search for a dedicated leader of BBN Technologies.

Ed Starr, who had joined BBN in 1959 and was serving as part of Campbell’s top management team, was chosen to be president of BBN Technologies. Starr was well known and respected throughout the company, having worked as a project leader and business leader in many capacities all around the company. However, Starr was planning to go to half-time work the next year and was thinking about full retirement. Starr agreed to serve as president for 18 months; and Tad Elmer was designated as Starr’s successor.

Elmer also had been on the search committee’s list, but he had never run a companywide activity. Elmer was a department manager who had been with BBN for many years and also was well known and respected throughout the company. Elmer had demonstrated entrepreneurial capability, having initiated a new branch office and moved his department into new business areas, particularly at the intersection of BBN’s involvement with computers and acoustics. Elmer worked closely with Starr, watching and learning.

Ed Starr did cut back his hours (and eventually retired), and Tad Elmer became president.10 With Starr and then Elmer at the helm, BBN Technologies began to reassert its traditional culture and approach to business (and financial viability).

By the time of the Bell Atlantic acquisition of GTE and the spin off of Genuity (what had previously been called BBN Planet), the BBN Technologies business and culture had already been substantially reinvigorated.

Verizon did not try to integrate BBN Technologies into the rest of its business. Instead it treated BBN Technologies benignly, and there was mutual respect between Verizon and BBN Technologies. BBN did do a little bit of work for Verizon, but generally BBN’s technologies were in too far from being off-the-shelf products to be useful to Verizon.

During the almost four year it was part of Verizon, BBN Technologies flourished in its classic business. Visiting BBN during that period, I heard one-time BBN colleagues of mine say that is was like the old BBN again—perhaps better.

In 2003 Verizon needed to change its capital structure in preparation for a big investment in FIOS and began looking for buyers for parts of the company not central to its future, including seeking a buyer for BBN Technologies. Worried about coming under the control of another owner not interested in the classic BBN business, Tad Elmer and his management team were given permission by Verizon to seek investors who would make an equivalent financial offer to keep BBN Technologies what it was; and they found such investors.

The sale, primarily to Accel Partners of Palo Alto, California, and General Catalyst Partners of Cambridge, Massachusetts, happened in March 2004, and was celebrated within BBN Technologies and by retired BBN people who retained a strong emotional attachment to BBN classic business continuing to flourish.

Of course, the outside investors wanted BBN to make money for them. Thus, as had happened so often in BBN’s past,11 there was pressure once again to license technology and to create products in addition to pursuing the traditional contract research and development business. This time BBN Technologies tried to be particularly quick and nimble and to take advantage of the contacts of the venture capitalists who were its major investors.

A new division was created for the licensing and product opportunities led by Alex Laats who came from outside the company with entrepreneurial, licensing, and venture capital experience. Between 2004 and 2009, several product opportunities were pursued. Some examples are:

• PodZinger12 audio and video search engine

• AVOKETM system and services to examine telephone interactions from the caller’s perspective

• Boomerang sniper detection localization system

• Digital Force Technologies (acquisition of a company with specialized manufacturing capabilities)

Boomerang is an representative example. This system detects incoming smallarms fire and displays the azimuth, range, and elevation of the shooter; it can be installed on a vehicle in an hour. Based on BBN Technologies’ prior acoustics and computer technology experience and development work, in 2005 DARPA awarded BBN Technologies a contract to prototype this system. BBN completed a set of prototype systems in 65 days. Eschewing the approach BBN had used sometimes in the past of setting up its ownmanufacturing activity, BBN Technologies outsourced manufacturing for Boomerang with BBN engineers working closely with the engineers of the a contract manufacturer to modify the design for productization, reliability, and manufacturability. In 2006 the Army ordered over 100 systems, and through 2008 there were additional procurements totaling approximately 10,000 units.

Some of the other projects, for example, Podzinger and Avoke, benefitted from the connections of the ventures capitalist owners of BBN.

Over the same period, BBN Technologies grew and expanded its traditional research and development activities, in combination with the aforementioned product activities.

By the time of the sale of BBN Technologies to Raytheon in late 2009, BBN Technologies had doubled its yearly revenue, tripled its yearly profit, and paid off the debt resulting from the leveraged buyout from Verizon.

22.3 The evolution continues

The day before my April 1, 2010, interview with Tad Elmer and Steve Milligan, I studied the BBN Technologies website, bbn.com, to try to understand how the areas in which BBN Technologies does research and development had changed since most of the chapters in this book were drafted in 2003. Looking under “technologies” on the website, I found the following categories:

• Advance Networking

• Cyber Security

• Heathcare Informatics

• Immersive Learning Technologies

• Information and Knowledge Technologies

• Sensor Systems

• Speech and Language Technologies

Each of those areas listed between 5 and 30 subareas. While I could see some overlap with what I knew from 2003, much was different.

Tad Elmer explained that he believes in rearranging existing technical groups and adding new groups with fair regularity—to pursue new technology opportunities, especially at the intersections of previous technology areas where innovation so often happens.13 Furthermore, long-time areas of BBN expertise have expanded. For example, Elmer explained that the sensors and detection area (see Chapter 10) has expanded to detection using any sensor media (for example, sound, infrared, magnetism) to look into or through any sort of substance; and speech and language technology leaders John Makhoul and Ralph Weischedel already hinted (see Chapters 14 and 15) at expansion in their area. There also has been expansion in other areas.

I asked Elmer and Milligan if there were any principles that guide the ongoing evolution of BBN Technologies and development of its people. Milligan said that the senior technical leaders (the “principle investigators” who represent the company technically to customers and mentor the relevant technical people) are allowed to move in any direction they want as long as: (a) it is legal and ethical; (b) someone outside the company is willing to pay for the work; and (c) the work is generally fun and interesting for the people at BBN. Elmer said that point b can slightly dominate point c if the contract is big enough.14

Such flexibility not only is allowed; it is encouraged. Some senior people who did not enjoy change and moving into new areas and ways of organizing have left the company.

One can’t know for certain how BBN Technologies will change as a consequence of its purchase by Raytheon. However, given the company’s 62-year history as a preeminent innovator, one can assume that Raytheon and BBN Technologies will work hard to keep this powerful national resource working in its traditional way in an ever evolving set of problem areas.

Notes and References

1. Some of the information in this chapter came from Steve Levy’s work on Chapter 6. Steve Blumenthal and Harry Forsdick providing confirming details on the Genuity-to-Level 3 transition in e-mails of April 3, 2010.
2. This information came from an interview of BBN Technologies president Tad Elmer and chief technology officer Steve Milligan at BBN in Cambridge, Massachusetts, on April 1, 2010, and from an e-mail of June 27, 2003 from Ed Starr.
3. GTE’s ownership of BBN Planet had not had a “long distance” problem because GTE had not been an RBOC.
4. Verizon retained an option to convert, under certain conditions, the 10 percent ownership it held after the sale of the equity into a 90 percent ownership position in Genuity. Between 2000 and 2002, Genuity continued to invest heavily in its growth, and annual revenues grew to in excess of $1 billion. Nevertheless, after a cumulative investment approaching $6 billion, Genuity was still incurring heavy operating losses; and, in the fall of 2003, Verizon announced that it was not going to exercise its option to convert its 10 percent equity position in Genuity into a 90 percent ownership position. Given its heavy, negative cash flow Genuity was then forced to file for bankruptcy under Chapter 11 of the U.S. bankruptcy laws. In early 2003, Level 3, Inc., acquired the operating assets and business of Genuity for something on the order of $200 million.
5. Somewhere along the line, the “Systems and” part of the BBN Systems and Technologies named was dropped.
6. The 2004 purchase price has never been publicly disclosed, but the 2009 sale price purportedly produced a nice profit for the investors, especially in a time of generally poor economic results.
7. See Chapter 7.
8. Conrades himself led BBN Technologies for over a year, in addition to his many other duties, until he was able to bring Campbell on board.
9. See the discussing of recruiting in section 5.2.
10. Around the same time David Campbell left GTE.
11. See Chapter 6.
12. The system’s name was later changed to RAMP.
13. Also, several years earlier BBN’s business related to ship quieting had been sold to Raytheon, thus eliminating that part of the company’s historic business.
14. In mid 2012 Tad Elmer retired from BBN. According to the bbn.com website, Ed Campbell is now president. At the time of his appointment as president, Ed had been with the company for 34 years and had been Tad Elmer’s deputy for many years.

And so we said, the only way we're going to do this is to do it ourselves, so let's give it a try. So we spun out of MIT at the end of the summer of '98, a year after the 50K started and got offices over in One Kendall and then called up those VCs and said, hey, we could use some money. Turned out to be harder than we thought to actually get the money on terms we wanted, so we had a period of about three to four months where we were funding it ourselves with friends and with some angels, professional angels. We had friends of friends we knew to bridge us to the first round with the VCs.

The details of the contacts with each Director are summarized below. To provide some context: As part of the creation of the consensus structure that eventually became ICANN, there was considerable discussion about how this new entity would be managed .. Since it was, by definition, intended to be a global consensus entity, it was understood by all that its management should be globally diverse. While there was considerable discussion about how the permanent Board should be constituted, it was generally understood that the Initial Board members would have to be produced by the same consensus process that-was to. create the new entity itself.

In fact, that is what happened. Simultaneously with the effort to develop a consensus organization, the entire Internet .community was invited to propose people who would be suitable as Initial Board members. At first, the general view seemed to be that the Initial Board should represent the various stakeholders in the process - those groups or coalitions that wereseparately.ldentffled and had a specific Interest to advance. It quickly became clear that it was not going to be easy - and perhaps impossible - to come to a consensus using this approach, in part because the various stakeholders·showed no propensity for coming to consensus on their particular · representative, and in part because it was difficult to perceive a consensus on which stakeholder groups should be represented on the Initial Board. The focus then changed to finding what were referred to as •1uminaries•- peopleo f outstanding credentials and reputations who had not been engaged in the debates and whom the lnternet community would recognize and support as both qualified and neutral.

The Initial Board as it now stands is the result of that latter effort, which was engaged in by numerous people around the world. In addition to volunteered proposals, Jon Postel and IANA affirmatively sought out recommendations from the full range of participants in the debate, including NSI. A number of people who seemed to be attractive candidates were approached in various ways and declined to be considered; others who were recommended seemed inappropriate for a variety of reasons. After considerable discussion, the current roster of Initial Board members was finally reached. The original suggestions of those people who ultimately came to serve on the Initial Board came from private. individuals, business organizations, trade associations, and officials of various governmental organizations. The final decisions on who would be invited were made by Jon Postel, after considering all the advice and recommendations received and coming to a judgment that this group of individuals was likely to receive consensus support from the Internet community. The official invitations were issued on behalf of Dr. Postel by his counsel.

With that preamble, the following summarizes the details of the contacts that each individual director experienced:

[...]

2. George H. Conrades

Sometime last fall, Mr. Conrades received a call on his car phone from John Patrick, whom he knew from working together at IBM. Mr. Patrick asked him if he was familiar with IANA and the effort to form a new private sector entity to take over those responsibilities. Mr. Conrades said he was aware of the effort. Mr. Patrick then told him that his name had been suggested as a possible initial director of the entity, and asked if he would be interested; Mr. Patrick said that the Global Internet Project was supporting this effort, and that Mr. Conrades' background and experience in the industry, combined with the fact that he was no longer associated with any company, made him a particularly good choice as a knowledgeable but neutral candidate. He then suggested that Mr. Conrades call Roger Cochetti for more details, which he did, and he subsequently agreeJ to let his name be submitted to the USG. He ·then received a call from the counsel to Jon Postel, who confirmed that his name would be submitted and discussed dates for an initial meeting, which was held in October.

[...]

George H. Conrades has served as Chairman and Chief Executive OÇcer of Akamai since April 1999 and as a director since December 1998. Mr. Conrades has also been a venture partner of Polaris Venture Partners, Inc., an early stage investment company, since August 1998. From August 1997 to July 1998, Mr. Conrades served as Executive Vice President of GTE and President of GTE Internetworking, an integrated telecommunication services Ñrm. Mr. Conrades served as Chairman of the Board of Directors and Chief Executive OÇcer of BBN Corporation, a national Internet services provider and Internet technology research and development company, from January 1994 until its acquisition by GTE Internetworking in July 1997. Prior to joining BBN Corporation, Mr. Conrades was an IBM Senior Vice President and a Member of IBM's Corporate Management Board. Mr. Conrades is currently a director of Viacom, Inc., a media company, and Cardinal Health, Inc., a health care company.

Akamai Technologies Inc. (Nasdaq: AKAM) chairman George Conrades will retire from the company's board as of June 1, the latest change at the Cambridge tech giant since activist hedge fund Elliott Management took a stake in the company last year.

Conrades will retire from the board on June 1, but will hand over the chairman role to another director, Frederic V. Salerno, effective immediately.

"I want to express my deep appreciation to George for his unwavering dedication and tremendous leadership over the past two decades," Akamai co-founder and CEO Tom Leightonsaid in a statement. "The impact of his work cannot be overstated, not just for the growth and customer-focused culture that he fostered at Akamai, but on the evolution of the internet as a whole."

Conrades joined Akamai's board in 1998, when it was still a tiny MIT startup. He took over the CEO role in 1999 and soon led the company through its initial public offering. Conrades handed over the CEO role to Paul Sagan in 2005.

Conrades' departure comes less than a month after the public got its first insight into the strategy that Elliott has in mind for Akamai. In early March, Akamai announced that it would add Tom Killalea, formerly the chief information security officer of Amazon, to its board of directors. The company also said it plans to add another board director, to be named later. Akamai didn't say whether the vacancy left by Conrades' departure would be filled by a third new director.

Akamai also said earlier this month it would work with Elliott to increase operating margins over the next several years.

The company has gone through several tumultuous years thanks to big shifts in the market for its internet content delivery technology. Akamai announced about 400 layoffs earlier this year, some of them connected to failed experiments within the internet content delivery division. At the same time, Akamai is doubling down on its fast-growing cybersecurity division.