Software AG buys webMethods for growth

GERMAN systems software and Service Oriented Architecture specialist Software AG has acquired webMethods, one of the surviving darlings of the original dotcom boom.

The acquisition, worth US$546 million (A$655 million) in cash, makes the combined entity one of the largest providers of business process management and SOA software.

Buying webMethods was a major step in Software AG’s recently announced strategic goal to more than double its revenues to Euro1 billion (A$1.6 billion).

The companies said the deal brings together complementary industry strengths and minimal customer overlap. The companies would give eachother immediate and mutual access to additional customer segments, particularly in financial services, manufacturing and the public sector.

Software AG and webMethods have a combined customer base of more than 4,000 organisartions and 100 partners in complementary geographies around the world.

Specifically, the acquisition will double Software AG’s customer base in the critical North American market.

“Combining our product portfolio and sales team with those of webMethods gives us a major foothold in the critical North American market,” Software AG chief executive Karl-Heinz Streibich said.

“WebMethods’ Fabric product family combined with Software AG’s Crossvision SOA suite will provide an end-to-end SOA solution that allows our combined client base to more effectively create, manage and govern their business processes,” Mr Streibich said.

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SOA spend soars as users seek flexibility

THE service oriented architecture (SOA) market will grow 40 per cent in the Asia-Pacific over the next two years as organisations seek more flexible business processes from the enterprise integration programs.

Research group Frost & Sullivan said SOA technologies had matured, with all major software vendors had been altering and creating software to suit the needs of an SOA framework, making the architecture a viable goal.

“The Asia-Pacific SOA market is poised for healthy growth as large enterprises across all verticals are adopting SOA-based solutions for their business related issues,” Frost & Sullivan research analyst Harikrishna Subramanian said.

“SOA offers solutions that optimize current business processes and efficiently plan future software adoptions of enterprises that are looking for continuous process improvement with clear visibility of the processes,” Mr Subramanian said.

Frost & Sullivan says large enterprises want to build more coherent IT infrastructure, driving demand for SOA. The potential for problems with enterprise IT projects tended to increase depending on the length of time since the organisation’s first IOT deployment, the number of software modules and size off the enterprise.

The increased complexity of software modules had increased the cost of implementing enterprise IT, the Frost report says, with SOA offering companies a way to reduce cost.

The report says the much greater penetration of Web services among enterprises in the Asia Pacific was also encouraging SOA deployment.

However, Frost & Sullivan says the low awareness of SOA and its potential benefits for an organisation had hampered market growth.

“Enterprises are shying away from implementing full-fledged SOA-based solutions mainly due to limited IT budget and time constraints. Vendors must focus on educating clients about the benefits of SOA and showcase best practices in order to draw up an efficient roadmap for SOA implementation,” the report said.

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