Big Blue's Software Spending Spree 85
abb_road writes "IBM has gone on an aggressive acquisitions spree for document management packages in the past three weeks, spending more than $2 billion to pick up two companies. The companies, Webify and FileNet, are expected to become part of IBM's Information on Demand strategy. The acquisitions point to a larger industry trend: a focus on software for unified corporate data management. From the article: 'It's a crucial time to jockey for most-valuable-software-provider status, because companies want to buy more from fewer players, and they're tired of buying stand-alone pieces of software like customer-relationship management that don't fix real-world business problems. The new message to software vendors: Fix my call centers, don't just sell me a product. As a result, the lines are starting to blur between software companies that offer, say, Internet security, databases, and tools to manage nearly every part of the business. So, too, are the lines between service companies and software companies.'"
Oh, sure... (Score:2, Funny)
Re:Oh, sure... (Score:3, Insightful)
Tom
Re:Oh, sure... (Score:2)
Worthless (Score:5, Interesting)
Don't even think of telling me that IBM are buying customers or market share! It's painfully obvious that the market is overvalued.
Re:Worthless (Score:2)
Re:Worthless (Score:2)
Seriously. These firms make apparently only 1 software product, that is probably relatively complex, but no rocket science. How come that these two firms that I (as a general nerd, not someone working in the field) never ever heard of are worth a f**king 1 billion dollars each?!?!
Re:Worthless (Score:2, Interesting)
You could try educating yourself first about Filenet [filenet.com] before posting, but I forget; this is Slashdot. Filenet has a buttload of products [filenet.com]; they also provide lots of consulting to go along with those products. BTW, consulting is IBM's bread and butter, if you didn't know. Filenet made [networkworld.com] $422 million bucks last year. At that level of income, IBM will make its money ba
Re:Worthless (Score:1, Insightful)
Many businesses and government agencies would simply not be able to function without this type of system.
Re:Worthless (Score:3, Insightful)
Um, you don't seem to understand "value". (Score:2)
You may install and use a piece of software which cost $5.50 to develop but which saves your organisation $500,000 per year. Someone sells that software to you for $450,000. You save $50,000 on the first year and $500,000 per year every year after that. The vendor makes $449,994.5 profit on the first implementation and $450,000 profit on each subsequent implementation.
What's the value of that software? $5.50? Bollocks it is.
Cost and value aren't directly related and the reason you aren't e
Re:Um, you don't seem to understand "value". (Score:1)
another uninformed pundit Re:Worthless (Score:1)
A document management system comparable to Filenet's offerings would require more than 20 man years [wikipedia.org] to develop. If you disagree, then please go for it; Filenet needs the competition. Otherwise, STFU.
Filenet provides more than just document management software. They provide a whole slew of products, as well as consulting services and support. Their document management, content management and workflow management products are used by 70
Learn before you speak... (Score:1)
Re:Worthless (Score:3, Insightful)
In any case, as others have pointed out, FileNet was a functioning, profitable co
Re:Or... (Score:5, Insightful)
Every job I have ever had has a pattern with IT: Our people aren't sharing information or documenting their work properly, lets spend X to upgrade our computers...Our people aren't sharing information or documenting their work properly, lets spend X2 to upgrade our computers...Our people aren't sharing information or documenting their work properly, lets spend X4 to upgrade our computers...and so on.
People need to start being more organized before any data-management software dose a bit of good.
Re:Or... (Score:3, Insightful)
Every job I have ever had has a pattern with IT: Our people aren't sharing information or documenting their work properly, lets spend X to upgrade our computers...
From my personal experience, people don't share information because it is inconvenient. I generate tons of documentation and information and people regularly ask me for info on something, which I provide to them. A lot more people probably want information I have, but don't know where to get it or how to find it. Why don't I make this more avai
Re:Or... (Score:2)
Re:Or... (Score:3, Interesting)
Wow, I wish I worked for your company. With mine, it's more like: Our sales are down; let's eliminate our Marketing department to save costs. (Actually happened.) We're still not bringing in enough money (surprise); let's move half the downstairs people upstairs, and half the upstairs people downstairs so they can communicate better. (Happens twice a year.) Our computers aren't running fa
Re:Or... (Score:3, Insightful)
It's not like we don'
Re:Or... (Score:5, Funny)
Are we talking Lenovo? (Score:2, Funny)
Re:Are we talking Lenovo? (Score:1)
thousands of years ago? (Score:1)
Re:thousands of years ago? (Score:1, Troll)
You neglected to factor in what a user once described to me as 'IT Time'. IT Time is when a tech tells a user, "I'll be back in 10 minutes.". That 10 minutes will actually be a minimum of several hours to a maximum of two weeks, at which time the tech flags the item in his queue as completed and then takes a 3 hour lunch break.
I'll let you do the math.
Re:thousands of years ago? (Score:1)
Re:Are we talking Lenovo? (Score:1)
I'm a little confused (Score:5, Insightful)
Re:I'm a little confused (Score:5, Insightful)
Re:I'm a little confused (Score:3, Insightful)
Oh [eclipse.org], really? [apache.org]
Re:I'm a little confused (Score:2)
Another is the way IBM forced all th
Re:I'm a little confused (Score:2)
Re:I'm a little confused (Score:4, Interesting)
In fact, IBM has bought most of their major products (Notes, etc) that I know of (I have no idea about the history of the mainframe stuff &c).
This is all probably better than the "not invented here" syndrome, I would except that focused start ups are more keen to innovate, particularly on vertical apps, than workers in a giant company like IBM.
Re:I'm a little confused (Score:2)
|Oh [eclipse.org], really? [apache.org]
Both Eclipse and Derby are the result of previous shopping sprees by IBM.
Eclipse was developed by the IBM Ottawa Software Lab [ibm.com]. This lab started life as OTI, a company which developed Smalltalk technology, that IBM bought in 1996 [findarticles.com].
Derby is the open-source version of the Cloudscape DB. Cloudscape was a Java DB company which was acquired by Informix in 1999 [javaworld.com], which was in turn acquired by IBM in 2005 [com.com].
Re:I'm a little confused (Score:1)
Re:I'm a little confused (Score:1)
Re:I'm a little confused (Score:4, Insightful)
Well, companies have market share and customers. If you build from scratch, you have to go in and compete from the ground up. If you buy an established company, you then get to control the direction of that software, as well as instantly getting yourself customers.
And, when fortune 500 buyers are looking at stuff, those reports from the Gartner Group go a long way. Basically, if your software isn't in the magic quadrant which makes it best of breed, you're probably not considered at purchase time. It goes a long way.
Buying FileNet, they undoubtedly get a huge installed base, as well as the opportunity to further sell into that organization. (Never underestimate the value of credibly getting your foot in the door to sell all of your other products.)
And, really, time to market and maturation of the software means that if you have the pockets, you can buy it sooner and possibly cheaper than you could build it. But, buying it means you get a salesforce, support infrastructure, and people who already know the software. As well as market recognition and whatever goodwill that has earned them from customers.
I've been watching some heavy-duty consolidation in the markets for a few years. A lot of companies prefer to acquire than try to develop from scratch. So, you're partly right - it is about buying them before someone else does. But it's partly about being in a new market segment next month, instead of in three years with a rev 1.0 product. That's too long of a time when you're competing against people already established in the market. Because they will have moved ahead a lot in that time, so you'll always be playing catch up.
Cheers
Re:I'm a little confused (Score:2)
In the last quarter's earnings conference call, an analyst specifically asked the IBM CFO what form of acquisition IBM makes. Loughridge described the great majority as "accretive" almost immediately. There is little overlap with existing offerings, so the acquisition's continued growth does n
Re:I'm a little confused (Score:2)
IBM definitely has the resources to create many of these software services themselves for alot less money. I think it's as much about buying these companies up before the competition can than getting the software.
Software is only one asset of a company like FileNet. How about: brand, customer loyalty, domain expertise, market share, talent. Even considering just the software: it isn't really helpful to pay a half a billion dollars to duplicate someone else's product if you will end up being two years be
More Crap for the IBM rep to push (Score:2, Interesting)
Re:More Crap for the IBM rep to push (Score:4, Insightful)
Hmm. Was the summary written by an IBMer by any chance? I don't see the words "on demand" or "business transformation" or anything like that, but...
Re:More Crap for the IBM rep to push (Score:1)
Bluepages says otherwise...
Re:More Crap for the IBM rep to push (Score:2)
How is it going to integrate (Score:4, Interesting)
Re:How is it going to integrate (Score:3, Interesting)
Re:How is it going to integrate (Score:2)
IBM stands to make a killing on the support contracts for FileNet. For even a medium sized company such as mine the support is very expensive.
Re:How is it going to integrate (Score:2)
What is document management anyway? (Score:1)
Re:What is document management anyway? (Score:2)
Re:What is document management anyway? (Score:3, Informative)
It's about control and structure.
The usual question is "why can't I just use our shared mapped drives?" - so here's what you DON'T get from shared mapped drives that you do get from a Document Management System (DMS):
* Metadata... Basic metadata on the document which can help searching, and can sometimes be sorted upon etc. The metadata often varies with the "document type" - so tender documents/procurement documents have an Account field, where meeting minutes instead have an Attendees field.
Re:What is document management anyway? (Score:1)
See http://www.naa.gov.au/recordkeeping/rkpubs/advices /advice70.html [naa.gov.au] for information on why shared drives are a problem (besides the excellent list you have already given). Sometimes information is more readily accepted when it comes from a supposedly 'reliable' source.
Re:What is document management anyway? (Score:1)
I work for a UK government-funded body, so we get the same sort of advice. It's all good, but selling it to users is pretty difficult at first.
I might just compare that link with our advice, and update accordingly. Thanks!
Bloat bloat bloat vomit (Score:4, Insightful)
Interesting point (Score:5, Interesting)
It seems to me that computers are progressively becoming less and less about computing, and more and more about simply storing and communicating data. A long time ago, IBM bought out Lotus software. Lotus became famous based on 1-2-3. It was the "killer app" that sold tons of DOS machines -- and oriented heavily toward doing computation. I'm not sure if IBM even still sells 1-2-3 or anything derived from it -- the big Lotus-derived products are Notes and Domino (I.e. storing and communicating data, not doing actual computing). In fact, you hardly hear about spreadsheets any more. Excel works, and a lot of people use it, but it doesn't seem to be a "killer app" for much of anybody anymore -- I'm pretty sure I haven't heard of anybody buying a machine to run it (or any other spreadsheet) in years.
Now acquisitions (and new development) seem to be oriented almost entirely toward storing and communicating data, not toward doing any actual computing. The same seems to be happening in software development as well. Languages for doing real computation, like FORTRAN and Matlab are almost universally seen as boring and passe. Even languages like C++ oriented kind of halfway toward computation seem to be viewed as a whole less less than exciting, anyway. What's hot are things like Ruby on Rails. Of course, you can write computational code in Ruby if you want to, but I'm pretty sure nearly nobody uses Ruby to do things like matrix multiplication -- they use it for Rails, to set up web sites that talk to databases (storing and communicating data).
In fairness, I suppose I should add that there are still a few "big things" oriented heavily toward real computation -- Folding@home and Seti@home for a couple of obvious ones -- and BOINC has a number of less obvious/well-known ones as well. Clearly computation isn't entirely dead and gone or anything like that.
I'm a little uncertain what this emphasis on simply storing and communicating data really means though. Was most computing that involved real computation really just a fad, and people were doing it primarily because it was new and different? Is the current emphasis on data storage and communication really just a fad, and people will care a lot less about it in a few years? Is it a matter of the "computing" parts of things mostly being cured problems, so they're less apparent, even though they're really as important as ever?
I suppose for this to be a proper comment, I should have a strong opinion to express about it, but I really don't -- at least for me it's almost entirely an open question.
Re:Interesting point (Score:4, Insightful)
No, not at all. The current emphasis on storage/communication/collaboration is the due to the business world recognizing the capabilities of what computing can do for them. Most businesses are not interested in the computational power of computing as much as they are the expenditure-reducing, labour-reducing and capability-increasing power of computing. The present computations revolve around business logic. Typically the business world holds a much different perspective on how a computer is useful to them.
Excel works, and a lot of people use it, but it doesn't seem to be a "killer app" for much of anybody anymore
Excel was and still is a very powerful too. There really isn't a subtitute for it. Personal, business, and government all use it. Microsoft Office isn't popular by coincidence -- the Excel, Access, Word, etc., suite is very powerful for all categories of work.
Re:Interesting point (Score:2)
Re:Interesting point (Score:1)
Re:Interesting point (Score:2)
The imaging piece is made to store images of documents, especially in the case of businesses that are required by law to keep certain documents for a number of years.
The thing is that many businesses
Re:Interesting point (Score:3, Insightful)
I remember a time, not so very long ago, when the very idea of a cellular phone was just electrifying. I watched the James Bond shows where he had a phone in his car with envy!
Now, I have a cheap, reliable cell phone at my hip (pretty much) 24x7, and it's casual. I'm annoyed more often than not getting calls when I'm trying to get something done.
The current emphasis on computing as a communications and
Re:Interesting point (Score:1)
Re:Interesting point (Score:1)
Re:Interesting point (Score:1)
Most business computer use *is* just about storing and organizing very dull data. Most accounting software STILL sucks (non-intuitive, complex UI; complete lack of interoperability; data lock-in; resource hogs...), fileservers are nothing but big file cabinets (and about as well org
They just bought MRO Software as well (Score:1)
Re:They just bought MRO Software as well (Score:2)
For those unfamiliar, Maximo (from at least version 5 onwards) runs on an application server that is either IBM's Websphere or BEA's Weblogic, I don't have figures but I'd guess the majority of installations use the latter. This might be a worrisome development for companies that went with BEA instead of IBM. Also, the database normally runs o
Re:They just bought MRO Software as well (Score:1)
Re:They just bought MRO Software as well (Score:2)
Neither DB2 nor WebSphere (the brand or the Applicaton Server) are a part of Tivoli.
Re:They just bought MRO Software as well (Score:2)
If they aren't part of that division, then someone needs to update the Wikipedia entry on Tivoli [wikipedia.org].
Re:They just bought MRO Software as well (Score:2)
From said article:
I believe "this IBM division" refers to Software Group, not Tivoli.
Indeed, if you look here [ibm.com], you'll see the five IBM software brands are In
New? (Score:1)
Re:IBM: PLEASE just trim some of the dead wood fir (Score:1)
Copy Kats (Score:1)
~psybre
Software - Service (Score:3, Interesting)
It seems to me that the F/OSS phenomenon is largely responsible for this shift. Think back to Cygnus, ISC, and other companies like them. For that matter, the early Red Hat years seem to fit that description, as well. Value-added service on top of a GPL'd stack is far from uncommon, these days, and often makes for a rather reasonable business strategy.
Couple that with IBM's grand (and expensive) ongoing experiment with gnu/linux, and this sort of observation is hardly surprising. It will be interesting to see what tech from these recent acquisitions make their way out into the F/OSS community at large.
My how times have changed (Score:2, Informative)
Just part of a trend (Score:2)
Same thing is happening for