Software AG Solidifies webMethods Acquisition with SOA Suite Rollout

| July 27, 2007 | Application Infrastructure | Competitive Intelligence Report

| Analyst: Brad Shimmin

Current Perspective: Very Positive
Vendor Importance: Very High
Market Impact: Very High

Event Summary

On July 25th Software AG unveiled the webMethods product suite as a comprehensive product portfolio for business integration, service-oriented architecture (SOA), business process management (BPM), and legacy modernization. With best-of-breed technology spanning the entire portfolio, the webMethods product suite maintains and extends current investments in Software AG’s Crossvision and webMethods technologies.

Analytical Summary

• Current Perspective: Very positive on Software AG quickly solidifying its recent acquisition of webMethods, unveiling the Software AG webMethods product suite. With this announcement, Software AG has officially defined its long term roadmap as well as short term product rationalization plan such that the company will maintain existing webMethods Fabric customers while offering combined capabilities that will pull both customer bases forward in synchrony.

• Vendor Importance: Very high to Software AG, as the company required an efficient means to enter the U.S. market as a stepping stone to its broader goal of becoming a one billion Euro company by 2011. The combined customer base exceeds 4,000 deployments across 72 countries, with Software AG carrying 1,000 support and professional services staff as well as a combined sales force of 380, 100 of which are located within the United States.

• Market Impact: Very high on the Service-Oriented Architecture market segment, as this acquisition and pending product line rationalization will put Software AG on more equal footing with traditional market leaders, IBM, Oracle, Sun, BEA, and TIBCO. Particularly with regards to high-end engagements, SAP customers, and firms with legacy integration/modernization requirements, Software AG will represent a formidable competitor to established players.

Recommended Competitor Actions

• Rival SOA platform vendors should position Software AG’s formal announcement of the webMethods product suite as a paper tiger, a compelling solution that does not yet exist as a complete solution that can be purchased and installed. There is a large number of product rationalization efforts still required before the company can begin entering the sales cycle with the webMethods suite.

• Competitors in the SOA integration space and middleware space (e.g., TIBCO, Oracle, BEA, Sun, Microsoft, etc.) should expand and enhance support for SOA governance technologies, continuing to focus on real-time policy enforcement. However, these vendors must begin emphasizing rule- and workflow-based design time/development time governance utilizing a role-driven interface for both business analysts and IT architects.

• Competitors (e.g., IBM, Progress, TIBCO, Sun, and BEA) should attempt to merge BAM and BPM functionality with complex event processing (CEP) tools. This means creating a bi-directional flow of information between both the business intelligence side and process optimization side that starts with process design and ends with process monitoring, repair, and optimization. This will pull these competitors away from Software AG, which is not focusing on this end of the SOA spectrum.

• Competing vendors with strong post-sale integration services should call attention to the fact that Software AG is currently retooling its professional services organization. This will certainly benefit from an infusion of intellectual capital from webMethods in the long run, but for now, Software AG’s efforts will be hampered until the company has rationalized product lines and settled upon a single set of deliverables.

• Rival SOA vendors without highly unified tooling should immediately prioritize the development of design and development offerings that are both Eclipse-based and able to work in concert with BAM/BPM and registry/repository software, facilitating run-time business process optimization. This will be a key differentiator for Software AG.

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