Why Tibco won’t be bought next

Ranadive, CEO of Tibco, has announced that Tibco board would of course consider offers.

And after the recent news about Business Objects and BEA, such offers may seen inevitable.  Jeff Schenider of MomentumSI for instance argues that we have entered a period of inevitable consolidation.  While I certainly think we are already in an era of big-4 and the rest, that does not necessarily mean that every ‘small’ software company (and remember these are only small in comparison to the giants) must be bought.

The Reuter’s piece covering Ranadive’s statement comments that “Analysts have said suitors for Tibco could include IBM (NYSE: IBM), Hewlett-Packard (NYSE: HP), Sun Microsystems (NSDQ: JAVA), and EMC (NYSE: EMC).”

I personally wonder.  On the one hand you could ask why not?  Tibco has excellent top tier customers who use its long standing messaging products for core business processing.  It also has some of the best SOA products in its BusinessWorks portfolio – combining enterprise grade reliability with good tooling.  However, I think you need to look a little deeper about the two acquisitions which sparked this consolidation talk:

BusinessObjects is in what should to be the hot growth area over the coming years – business intelligence – and thus is perfect for the vendors who want to find a new thing to sell to their customer base or a new way to justify their existing product line (by adding a BI layer on top).  Business Objects should have been a target for IBM and Oracle as well as SAP.

BEA was generally believed to be a long term target for Oracle – BEA had after all used the application server wave to capture business from so many of Oracle’s enterprise customers.  Oracle first took quite a while to take application servers seriously and then took quite a while to become competitive.  Buying BEA finishes the job off quickly and gets back ownership of all those straying BEA customers.

With Tibco, there is no obvious buyer (as Oracle was with BEA) nor is there a neat fit into one of the majors (as BusinessObjects was with SAP).  Of the 4 listed by the “Analysts” quoted above, only IBM would make any sense.  And Oracle, except that it is busy trying to eat BEA.  Therefore, I don’t see Tibco being bought except unless it is Skyped (bought for over the odds to avoid somebody else buying it).

Ronan

Oracle moves to buy BEA: The end of the J2EE era?

Oracle has finally done what so many rumours have pointed to for at least a few years:

made an offer to buy BEA.  I am sure that there will be much comment on the challenges of dealing with the total overlap between BEA’s core product – the WebLogic applications server – and Oracle’s application server (both in the top three by most measures of market size).  The move should also take the wind out of speculation that Oracle will make a spoiler bid for Business Objects.

The writing off of BEA as a business by some has been totally over-stated.  However, I think if this bid is successful it does marks the end of the J2EE era.  Not that I am suggesting that J2EE application servers are going to go away of course.  Rather, the world has moved on from what created that market in the late nineties.  At one end of the spectrum, the focus has moved back towards technology independent architectures with SOA (just as CORBA attempted to do in the pre-J2EE days – all be it by creating another set of technology).  At the other end, lighter weight approaches such as Spring have superceded the heavier and more complex EJB model (which to be fair has also moved with the times but probably too late).

It is also worth noting that the disappearance of the large enterprise focused ISVs continues – in one week we appear to be losing another two.  It is beginning to look like that the enterprise software market is heading for a strongly polarised world made up of a big-four (MS, Oracle, IBM and SAP) with a huge gap to the next division.

Ronan

SAP buys Business Objects

It was announced yesterday that SAP is acquiring Business Objects for $6.8billion in what is described as a friendly take-over (and leaked out a couple of weeks back as reported here ).

On the product side, the benefits are obvious from SAP perspective – although there will certainly be some integration and overlap issues for SAP to deal with (covered well by Forrester here).  Clearly, it also brings a large number of new customers to SAP – although it will be a long term project to bring them over to other SAP products.

From the vendor perspective, it reduces the choice for ISVs wanting to partner with a Business Intelligence vendor.  This should make Cognos (now the only significant independent BI vendor) in particular happy.  However, the big question is will IBM grab Cognos now to fill its own BI gap before Oracle gets there first.  Of course nothing may happen – Remember the speculation around Informatica and Oracle after Ascential was bought by IBM a couple of years back?

And finally… For the customers of BO, it will take a while for the smoke to clear.  However, SAP paying that amount of money should make BO customers very confident that their software has a strong future.  What it means to users of SAP’s existing BI product is equally obvious:  While it is very likely the products will be supported for a long time, it is equally very likely that they will not be the basis of SAP’s BI strategy going forward.

Ronan

IBM’s Information on Demand streamroller gains speed with the Princeton Softech acquisition

IBM announced the completion of its acquisition of Princeton Softech – a company which focused on data archiving, classification and discovery software.

All of which sounds quite specialist until it is put into the context of IBM’s Information on Demand (IoD) strategy.  Back in March, Ambuj Hoyal, who heads us IBM’s Information Management division (with responsibility for the Information on Demand strategy) explained:

“… an inflection point occurred in 1996 when there were many techniques to create Web sites or do Web-based business… We are at a similar inflection point in 2006. We have myriads of techniques – metadata management, ETL (extraction, transformation, and loading) tools, data creation tools, Federation tools, cleansing tools, profiling tools. People use these tools to solve the information challenge.”

To translate, IBM see a huge opportunity and are putting serious money into it – this acquisition is the latest of 21 which are part of this strategy (to see the list go here).  The opportunity is to build an information management platform which allows organisations to create, maintain and (most importantly) extract value from the myriad of data sources which flow around the enterprise.  Data cleansing, data distribution, data integration and master data management (among other areas) are each expensive activities but often have clear budget and value associated with them – this even before getting to semi-structured information which is also with the Information on Demand remit.  While there are best of breed solutions to different parts of the puzzle, there aren’t single integrated solutions – which is what IBM hopes to offer.  Interestingly, IBM has yet to move on Business Intelligence vendors – it appears to have correctly realised that the major task is not creating dashboards; it is ensuring that what goes into the dashboards is correct and timely.

Any familar with the area of enterprise data management will realise that the challenges inherent in building and deploying such a platform are formidible.  At a recent briefing IBM gave Lustratus, the whole area of data governance in particular was highlighted:  how do you organise structures and responsibilities to ensure that coherent and consistent data definitions can be used and reused through the enterprise (this should sound very familiar to anybody involved in SOA – just switch the word service for data!).  To figure out how to do this right IBM set up the Data Governance Council back in 2005 with many leading financial services and telecoms companies (among others).

Yet again getting into detail is beyond the scope of a normal blog – but I would recommend anybody with a passing interest in BI (or indeed enterprise architectures) to take a look at IBM’s web-site on Information on Demand. Of course the strategy is not without obvious challenges:  The technology is from many different sources (even if it now all belongs to IBM) and there is a significant amount of complexity associated with solving such a complex problem.  Also, when there isn’t a significant regulatory stick (Basel II for instance), I imagine it could be very hard to sell at a strategic level.  This is because while there are clearly valuable uses of Information on Demand, but there seems to be no common theme around which business momentum can be built.  And finally, its association with the term business intelligence may well go against it – already some analysts are wondering where IBM’s query tools will stack up against Business Objects et al (not a relevant question as BO and others will sit on top of IoD) and in many cases the proposition is operational efficiency or regulatory compliance, not (to my mind at least) classic BI.

Ronan

CICS users of SOA get a bit of a headache

IBM has many SOA tools in its armoury, and has made it quite clear that SOA is a key focus for the company.

I find it disappointing, therefore, that IBM seems to have slipped up a bit on its normally strong record of providing onward compatibility with its SOA solutions. Users of IBM’s power-house mainframe transaction processing product, CICS, have a bit of a headache coming – CICS TS 3.1 offered many useful tools for using CICS resources as part of an overall service-oriented architecture, including the Service Flow Feature. However, as IBM rolls out the new CICS TS 3.2 level of the product, it turns out that according to IBM, service flows built for the CICS TS 3.1 environment wont work with TS 3.2. The IBM announcement letter states:

CICS Service Flow Feature:

The level of CICS Service Flow Feature that is provided with CICS TS V3.2 cannot be used with CICS TS V3.1. The CICS Service Flow Feature of CICS TS V3.1 cannot be used with CICS TS V3.2. Customers who have implemented service flows using the CICS Service Flow Feature of CICS TS V3.1 must migrate the service flow models created to the CICS Service Flow Feature for CICS TS V3.2 and regenerate the service flow executable for deployment to CICS TS V3.2. Tools to assist in migration of flow models created using the CICS Service Flow Feature of CICS TS V3.1 will be delivered when the CICS Service Flow Feature of CICS TS V3.2 is available. Service flow executables generated using the CICS Service Flow Feature of CICS TS V3.1 will not run under the CICS Service Flow Feature of CICS TS V3.2. Forward binary compatibility between offerings is the usual migration approach that IBM strives to offer. In this instance, as the result of the maturing of the implementation to deliver enhanced serviceability, forward migration at the model level is the required approach.

Although IBM says it will offer tools to help, I think it is a bit of a poor show that onward compatibility could not be maintained. Customers who have used the CICS service flow feature will not welcome this headache.

Steve

IBM, DataMirror … and Teilhard?

When IBM announced it wanted to acquire DataMirror, they probably didn’t even notice that there is an ongoing lawsuit between DataMirror and Teilhard Technologies – after all, this ‘battle of the midgets’ would hardly register on the giant’s radar.

For the vast majority of people who don’t know what I am talking about, Teilhard is a tiny Canadian company that has a patent to do with heterogeneous data exchange. I previously blogged about this when Oracle announced a settlement with Teilhard, earlier this year. Those people with a life probably do not know that this same company has a lawsuit running with DataMirror (actually, it has been running for three years now).

However, it seems to me that IBM coming into the game could well stir the pot. Would IBM mind if a company it had acquired were to lose an infringement case? Would it decide to get its own legal behemoth involved? If a settlement was agreed, would IBM’s presence inflate the figures? In the end, would IBM care at all?

If IBM did decide to take an interest, things could get quite amusing. After all, although Teilhard is suing DataMirror, DataMirror has filed a counter-claim. If IBM chose to notice this tiny irritation and do something about it, perhaps this whole thing could backfire on Teilhard.

Steve

EDA vs SOA

I have been involved in some recent research into event-driven architecture (EDA) and its relationship to service-oriented architecture (SOA), as a result of confusion abounding over the two concepts.

Some people seem to think EDA = SOA 2.0. Others that they are already doing EDA in their SOA implementations because they are using asynchronous communications such as a JMS or IBM WebSphereMQ. This confusion is exacerbated by vendors with their own agendas – TIBCO has been banging the EDA drum for ages as the preferred way to go to solve integration problems, IBM has just held a massive event to drive its own SOA agenda, Oracle seem to be trying to straddle the two approaches, and complex event processing (CEP) vendors like Progress have their own stories about EDA.

My own analysis, together with Dr. Ronan Bradley, also of Lustratus, has concluded that as is so often the case, the problem comes down to confusion over terminology. EDA is an architecture, just like SOA. It is a way of running operations, and before anyone starts to ask whether I am on the side of SOA or EDA, the two can happily coexist. But the confusion arises when people start to use EDA as a term to refer to particular implementations rather than to the architecture itself.

In fact, we identified 3 major ways that EDA relates to SOA, and concluded that EDA may have a key role to play as SOA matures – to deal with the increasing management complexity of widescale SOA deployments through a ‘management by exception’ approach.

For those interested in reading the detailed research, Lustratus has published an Insight on the subject, available at the Lustratus site.

Steve

SOA gets its second life

I attended the IBM Impact 2007 SOA show this week, along with 4000 others.

But we weren’t the biggest crowd at the show – according to IBM there were at least as many again who attended in Second Life. IBM has built a presence in the multi-player role-playing universe, and the event was carried there as well. How the world is changing!

As far as the show itself goes, the one thing that came over to me loud and clear was that IBM is really serious about SOA. Looking at the breadth of discussions and the different parts of IBM involved, it seems that large parts of the company are well and truly geared up to the SOA drumbeat, spanning both product and service areas. And now they are moving into the alternative universe of Second Life too. There really is no escape!

Steve

One user’s experiences with Linux

I attended a very interesting presentation from the CIO of a large retail firm, the other day, about his experiences with Linux, and particularly Linux running on an IBM mainframe (z/Linux).

This company has been involved with Linux for around 3 years, and I picked up a number of key points.

Basically, the company has been moving some workloads from Intel-based Microsoft servers to the z/Linux environment. One of the first points I picked up was the improved utilization of resources, with corresponding cost savings. Instead of heaving a bank of servers each running at 10% or so utilization, the workloads all ran on the mainframe. This avoids a lot of wasted capacity. What was also extremely interesting was that the company ran the two systems side by side for four months to validate the solution was working correctly, and whereas the server-based system had a number of unplanned outages and failures, the Linux system was 100% reliable.

Another salient point was that in each store, IT support for the store’s needs are provided by a local Linux server. This has the byproduct in the new environment of providing a fail-over environment in z/Linux on the mainframe – because the two operating system environments are the same, it is relatively easy to do this.

An important observation from the CIO was that Linux is definitely not free. However, this company has found a number of major benefits in cost terms:

  • S/W license costs (eg system software) are reduced
  • One resource provides support (vs 1 per 12 servers in old environment)
  • Capital expenditure is reduced (better utilization, as discussed)

In addition to these cost benefits, the CIO is able to respond to new demands more quickly because a new server request is satisfied by a logical reconfiguration on the mainframe rather than having to get approval for and purchase a new server.

The summary was that the big hitters for this particular company were TCO (total cost of ownership) reduction and availability improvements. However, one final point is worth mentioning. The CIO pointed out that the company is not expecting Linux to supplant Windows. It is true that Open Office is being trialled in some places, but his expectation is that there is a place for both environments.

Steve