BEA reinforces independent streak

Alfred Chuang, CEO of business middleware maker BEA Systems is probably not alone in having problems with his new iPod Nano. When he received email confirmation of his order from, he noticed that the personalised inscription he had asked for contained a misplaced dash.

That sent the fastidious Chuang back online to correct the error. But, although Apple's ecommerce system accepted the changes to his order, two music players turned up at his house: one with the niggling mistake, one without – plus a stern reminder that no personalised items could be returnable.

Chuang is probably one of the few that can take his problems to the top: he got straight on the phone to Apple CEO Steve Jobs. "I told him: ‘There's something seriously wrong with your systems.' I mean, these iPods are the newest of the new, the latest craze, but the ordering systems…" Improving enterprise IT systems, specifically allowing applications such as order processing to operate efficiently across multiple delivery channels, is one of those subjects that is close to Chuang's heart: after all, it is his business's raison d' être.

Companies working with multiple enterprise applications and databases need a layer of abstraction that ties those together in a service-oriented architecture (SOA), he says – and only an application-neutral vendor is in a position to satisfy that requirement.

Lots of software makers are keen to talk about SOA, he continues. But buyers should be cautious about their offerings. "Take SAP, it's a great company, a leader. They produce world-class ERP [enterprise resource planning] systems, but when it comes to SOA, which other applications other than SAP run on [SAP's application server] NetWeaver?" asks Chuang.

While Chuang is keen to stress the importance of BEA's independence, others point out it may be a weakness. Oracle's CEO Larry Ellison has already identified BEA as a potential acquisition target; its position as an independent innovator was bruised by an outflow of senior technologists last year.

Furthermore, BEA – a company with a reputation for making bold acquisitions that have enabled it to establish leadership in nascent markets – has recently been making buys that have left market watchers nonplussed. In October 2005, BEA closed its $200 million deal to buy portal software maker Plumtree. "We view this acquisition as a roll up of the portal space and do not expect to see a great deal of growth out of the combination," was the terse summary of the deal by analysts at Piper Jaffray & Co.

But BEA executives remain bullish over the Plumtree deal: "You have to look at both [BEA and Plumtree's] portal products: they are substantially different," says Kevin Faulkner, VP of investor relations at BEA. "Ours is being used in large scale transactional systems, such as airline check-ins; Plumtree specialised in portals for internal collaboration between highly distributed teams."

Importantly, the deal also fills a gap in BEA's product line, says Gartner analyst Gene Phifer, in a research note: "It provides better presence in the .NET world through Plumtree's multiplatform strategy, an area in which [BEA's] WebLogic was lacking."

Now Chuang's job is to demonstrate that Plumtree rounds out a software stack so compelling it would make Steve Jobs switch ecommerce systems.

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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...

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