A quick take on Oracle and Sun
Earlier this year IBM (and reportedly) HP both took Sun Microsystems out for first dates but neither decided to take things any further (though IBM arguably got to second base). Now it seems
Oracle is prepared to go the whole way with the iconic dot.com technology brand. Are we looking at a beautiful wedding on the beach in Maui, or a drunken fumble in a dark alley followed by recriminations, tears and vengeful fathers?
It's telling that in this era of instant communication I feel under pressure to say something incisive and erudite, even though it's only a few hours since the acquisition was announced and hundreds of other commentators have heard the same conference calls and read the same press releases. So what is there to say beyond "blimey, I never saw that coming"? (Because it's true, I didn't – and I never would have put Oracle on the list if I'd been asked to draw one up). I'll take a deep breath.
I think the most telling take-away I got from all the materials available from the two parties today was the balance of information about earnings, assets and market shares vs. information about shared vision and customer value (there was a bit of the latter in evidence from Jonathan Schwartz and Chuck Philips, but it sounded distinctly lacking in energy). By contrast Oracle CFO Safra Catz was by far the most animated exec on the call, particularly as she explained how Sun would contribute more operating income in its first year as part of Oracle ($1.5bn) than BEA and PeopleSoft did combined (an interesting side note: Oracle paid more for BEA than it intends to for Sun, despite that tasty financial upside. Aren’t stock markets fantastic).
I wouldn't go as far as
Vinnie Mirchandani (executive summary: Oracle is just after making a quick buck and has a poor track record of sustaining innovation following its acquisitions), but I remain to be convinced as to whether this has any positive implications for customers of either Oracle or Sun. You could argue that with Oracle as banker, Sun customers can now have more confidence about the future of their technology choices: but squeezing out $1.5bn operating income out of a company that's only occasionally managed to turn any kind of a profit in the recent past is going to mean quite a lot of "shrinkage" – the kind of shrinkage that cuts much deeper than the back office. So a future rich in systems innovation is far from certain, at least in the short-to-medium term. And in the current environment, with data center economics shifting so fast, the short-to-medium term is likely more than enough time for Sun's customers' heads to be turned towards its competitors. This is a very fast-moving marketplace, and innovation has to be in evidence for any vendor wanting to avoid a slippery slope towards the Systems Supplier Graveyard.
Of course, Oracle's intention could be (as RedMonk's
Cote among others have noted) to strip out Sun's hardware and sell it off - instead focusing on the software assets (Java, primarily). In which case it will hardly care about what happens to Sun's systems customers.
It's important to be balanced though.
With my optimistic hat on, I can see that there are nice things that could come out of this. Sun could effectively tick a box that Oracle probably has on a strategy document somewhere called "Cloud Computing strategy";
despite Larry Ellison's public dismissal of the hype, we all know that makes sense for Oracle to continue to move forward from its current position on Cloud. Sun's virtualisation, datacenter-in-a-box and nascent Cloud platform offerings, combined with the "
integrated apps-to-disk" proposition Oracle and Sun talked briefly about today, could sow the seeds of a story that could bridge the interests of mainstream IT shops, leading-edge startups, ISVs and outsourcing providers.
At the moment, it's too early to tell – we'll have to wait until the summer, when the deal closes, to cast the runes again. Until then, let's get on with our lives. Now,
what's on YouTube today?
Labels: acquisition, cloud computing, industry, Oracle, Sun
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Labels: MWD
Is there room for architects and architecture in BPM?
With much of the early development in the Business Process Management (BPM) market being driven by technology vendors selling products for one-off departmental projects to line-of-business heads, and with IT stakeholders often being brought in only after the deal is done, lately we've been wondering - now that there's no doubt that BPM is becoming more mainstream - what's the role of IT architects, and IT architecture, in today's BPM initiatives? There's a lot of talk in the BPM technology vendor community about enabling customers to "scale up" their BPM initiatives - and it seems to us that IT architect involvement is likely to be a key factor in shaping how that happens in practice.
Behind the scenes we've recently built a great relationship with the not-for-profit International Association of Software Architects (
IASA), and so we asked them if they'd help us explore this question. We've worked together to carry out a web-based survey - and although all IASA members have now been invited to take part, I wanted to make sure that you had a chance to take a look and offer your thoughts, too. If you're in an IT architecture role, or know someone who is, we'd be delighted to have your involvement:
you can find the online survey here.
Once the survey is complete, we'll create an in-depth report drilling into the survey findings and correlating them with findings from our other BPM research work. Everyone taking part in this survey will be eligible to receive a free copy of the report. We'll also create an IASA-only webinar, based on the survey results and adding other best-practice insights. All IASA members will be able to access this webinar free of charge.
So - if you're an IT architect or know someone who is - we'd
love to hear from you! And if you're interested in the IASA webinar we're creating -
it's easy to become an IASA member...
Labels: architecture, BPM, IASA, survey, webinar
Progress Software - getting past "Who"?
A couple of months back I had a brief Twitter exchange with David Bressler of Progress Software (
@djbressler), following a comment I'd seen from Judith Hurwitz (
@jhurwitz) at Progress' analyst day regarding the lack of brand awareness that the company has out there in industry. What I said was: "Progress is a bit like Unilever - top-level brand is vanilla, sub-brands have chops". What I meant is that these days, there's little knowledge of what Progress does (a typical response is either "Who?" or possibly "oh, they used to sell a 4GL and a database in the 1990s, didn't they") - whereas there's much more recognition of brands like Sonic (SOA infrastructure), Actional (SOA management / governance), IONA (middleware, SOA infrastructure), Apama (event processing), DataXtend (data integration) and DataDirect (data connectivity, legacy application integration).
David replied that Progress is a technology company's company - which is absolutely correct: Progress has a long and successful history of providing a platform for other software vendors to embed in their application offerings. And he followed up with
this blog entry, saying "We'd love for the Progress brand to have some chops, and we're trying but it's not trivial."
Well, for a few weeks I'd been meaning to write a blog post of my own exploring this - but in the general headlong rush that we've been experiencing so far this year, I'd forgotten to write that post. When I saw today's news that
there's been a change at the top at Progress, though, I was finally prompted to write some thoughts down. (Thanks for the pointer
Miko).
The main thought in my head all those weeks ago was that it's all very well for Progress to be a bit like Unilever - with the sub-brands (Sonic, Actional, Apama, DataDirect, and so on) having much more visibility in industry than the parent brand - as long as the company doesn't want to start pulling together broader IT and business infrastructure propositions that tie together pieces from the different brands. Unilever is well-known for owning a vast portfolio of products, many of which actually compete with others in the portfolio (Dove v Lux; or Persil v Surf, for example. The invisibility of the parent brand is fine for Unilever, but it's bad news for Progress if it wants to really make the most of its potential within enterprises (by cross-selling or bundling its products to help customers with broader opportunities, for example).
So this is the point where the company has to undergo a pretty radical shift.
As reported in PCWorld, the new Progress Software CEO (formerly the COO) has established a target of doubling the company's annual revenue to around $1bn, by "reorienting sales towards multi-product suites, as well as aiming marketing messages more at business executives than IT workers" - that is, precisely what it's not currently suited to doing.
This goal makes absolute sense, and in fact it has made sense for ages. The majority of the markets where Progress' brands play are growth markets where there's real opportunity, right now; and what's more, the combination of the offerings could have real power, too.
The required shift will be no picnic, but there are worse times for Progress to be trying to make it happen. There's a new man at the top with a new broom, no doubt; and what's more, there's still a small window of opportunity open for another medium-to-large-sized specialist infrastructure software vendor to pick up business, following BEA's acquisition by Oracle a few months back. TIBCO and Software AG have recently been making much of BEA's disappearance as an "independent" infrastructure software vendor, and it's surely no coincidence that both these companies also have aspirations to reach $1bn in annual revenues (Software AG has been particularly vocal about this of late). Progress has long had the potential to join Software AG and TIBCO as a serious contender for enterprises wanting to avoid getting into bed with the MISO pack (Microsoft, IBM, SAP or Oracle) for whatever reason, but until now it just never seemed to be able to be bothered to do what was necessary.
With a new CEO at the top, it'll be fascinating to see whether Progress can move up a gear. If it succeeds, then enterprises wanting to avoid giving too much technology supplier power to the MISO pack may well have a new choice - and in a market where consolidation has recently been rampant, more choice would be refreshing for everyone.
Labels: industry, integration, Progress, SOA, Software AG, TIBCO
