Software AG Puts Extra B2B in Its SOA Platform with Proginet OEM Deal

| Apr 1, 2009 | Application Infrastructure | Competitive Update

| Analyst: Michael Meehan

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

Event Summary

March 30, 2009 - Software AG and Proginet Corporation have announced the availability of webMethods ActiveTransfer, a solution for managed file transfer available as part of the webMethods Suite. The strategic OEM partnership with Proginet provides organizations with a secure and reliable way to transfer large files, facilitates seamless trading partner integration, and provides a platform for compliance with regulatory mandates and security best practices.

Analytical Summary

• Current Perspective: Positive on Software AG for its agreement to OEM the Proginet CFI Internet Server for managed file transfer (MFT) and market it in conjunction with ESB, B2B and BPM offerings. Dubbed webMethods ActiveTransfer, the OEMed software product fits seamlessly into the Software AG service-oriented architecture (SOA) portfolio, giving the vendor an opportunity to address a whole new layer of business issues such as trading partner on-boarding and regulatory compliance.

• Vendor Importance: High to Software AG, because its B2B footprint prior to this deal was limited to an EDI gateway. MFT represents a natural extension of the vendor’s distributed service delivery capabilities and it is important for Software AG to focus its attention outside the corporate firewalls of its customers as well as inside those firewalls.

• Market Impact: High on the middleware and MFT markets, because Software AG does a very good job of selling new products into its existing customer bases, particularly its core mainframe-centric Adabas database product. ActiveTransfer represents a fairly natural fit for those Adabas customers, especially those who are also adopting Software AG’s SOA products. It not only helps to round out Software AG’s integration story, but it stands to put pressure on MFT vendors who will be facing off against a new rival in their customer engagements.

Recommended Competitor Actions

• IBM should view this release as strengthening its DataPower story. While TIBCO has made a fine start with the P-7500, it cannot match the maturity or breadth of the DataPower line at this time. Yet it confirms IBM’s vision that much of what is considered software infrastructure actually works better as a network appliance. IBM should position itself as the reigning king of the high volume messaging appliance market.

• Oracle needs to get into the appliance game, particularly with the acquisition of the Tuxedo transactional software business from BEA. It may choose to partner with Cisco or small vendors like Layer 7 and Vordel to put its messaging and integration software into an appliance or it may seek to acquire one of those small vendors, but it does not want to find itself running up against multiple competitors in those spaces with plug-and-play high performance hardware.

• Cisco needs to reinvigorate the marketing and strategy for its AON and ACE XML Gateway products before they become irrelevant. Should TIBCO successfully convert a good portion of its Rendezvous customer base to the P-7500, it will eclipse Cisco in the messaging appliance market. A partnership with Oracle would allow Cisco to engage with stakeholders outside the network center and provide a wide array of application infrastructure functionality that could be built into a device.

• Integration software vendors such as Progress, Software AG and Sun need to respond with their own high performance approaches to the market. They do not necessarily have to get experimental with form factors, but they should recognize, as TIBCO seemingly has, that SOA market is shifting from agility to performance. Customers have gotten used to integrating disparate systems and creating dynamic services. The new battleground is to scale those services and to do so at high velocity.

Recommended Competitor Actions

• IBM should hasten to release new frameworks integrated with Sterling Commerce. It plans to validate the Sterling Selling and Fulfillment Suite with its manufacturing, financial services, communications and media SOA-enabled business process frameworks and it is clearly not alone in seeing the value of pushing dynamic services into the B2B arena.

• MFT competitors of Proginet should be looking to make similar go-to-market and OEM deals with SOA platform vendors such as Oracle, SAP, Microsoft, TIBCO, Progress and Red Hat. Distributed services reach beyond the corporate firewall and the B2B vendors who can position themselves to work best with those services stand to gain a competitive advantage over those who try to keep inexorable trends in the application development space at bay.

• Hardware vendors should view the Software AG-Proginet OEM deal and IBM-Sterling partnership as evidence that the market is ripe for an SOA-centric MFT appliance. If it’s a good idea in software, it ought to perform even better in hardware. IBM Datapower already has an AS2/AS3-based B2B appliance on the market. Vendors such as Layer 7 and Vordel stand to gain from product in this space as SOA platforms move in this direction.

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Competitive Positives and Concerns

Recommended Vendor Actions

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