BEA battles IBM, prepares for Microsoft

When BEA Systems’ sales dipped unexpectedly in 2001, the company might have been forgiven for thinking that the decline could be blamed solely on the economic downturn. But when executive vice president Tod Nielsen talked to BEA’s customers, he heard a very different story. Quite simply, they seemed confused about the company’s strategy.

“A number of them asked, ‘Why are you talking about your products like they are different things?’,” says Nielsen. In the same sales call, BEA staff were offering a portal product, an integration product and an application server, yet much of the underlying technology was the same.

Wouldn’t it make sense, suggested some customers, to unify the products into a single stack? That would improve integration, make it easier to use and help cut costs. The idea appealed to Nielsen, and in July 2003, two years on from what he modestly describes as an “epiphany”, BEA released WebLogic Server 8.1.

Since then BEA’s annual revenue has topped $1 billion for the first time, with software sales rising 12% sequentially in the quarter following the product release.

This is the way the market is going, says Nielsen: from standalone portals, integration or application servers, to unified platforms that offer a high level of integration and consistency between their various components.

Not all vendors have responded to user demands for simplicity and ease-of-use, he says. WebLogic, he points out, is now shipped on just one CD, while WebSphere, IBM’s rival product comes on more than 200 (although a different interpretation would say that that is because WebSphere encompasses a much broader set of products than WebLogic).

IBM’s problem, claims Nielsen, is that it offers a “hotch-potch of platforms and tools” some of which do not integrate well. IBM may be the chief rival, but BEA has a jaded opinion of Oracle, Sun Microsystems and Microsoft too.

“We see Oracle more with press and analysts than with customers. Sun ONE [Sun’s Java-based software stack], we just never see,” he says. The reason? Market confusion. “Sun comes out with a different strategy every six months,” he says.

As for Microsoft, he says it has been forced to delay its ambitious next generation database and operating system platforms, which are supposed to be mutually integrated with its .Net development environment. Meanwhile, .Net is not yet scalable enough, particularly for running applications on clusters of servers, he says: “We’ve found from customers that up-time is a big factor when they stick multiple boxes together. It works, but not to the service levels the enterprise requires.”

But Nielsen is equally certain that Microsoft will iron out its shortcomings so that by the time the battle between IBM and BEA is over, the winner will almost certainly face Microsoft.

Nielsen worked for Microsoft for 12 years before leaving to found CrossGain, the software tools start-up snapped up by BEA just a year later. His final task before he left? Helping with the launch of .Net. Now, he is doing all he can to undo that.

Avatar photo

Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

Related Topics