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i>IBM spawned the open source Eclipse Foundation—in large part to foster applications development on Websphere, its middleware platform at the center of IBM’s on-demand e-business strategy. Today, Websphere is supported by more than 9,000 independent software vendors (ISVs). Recently, Joe Damassa, Websphere vice president of marketing, talked with Ziff Davis Channel Zone Editor Carol Ellison about collaboration and competition within Eclipse and the role developers play as Big Blue channel partners.

Ellison—Let’s start with a short history behind the Websphere platform. Is it evolving according to expectation?

We brought Websphere to market as an applications server in the 1998-early 1999 timeframe but the real value proposition for the customer was what was needed to build the applications. It was the tools, integrated with the platform, that made it easy to build applications and, therefore, reduce the development cycle. In those days when everyone was rushing to bring applications to market because of all the .com hype, it was very important to shorten the development cycle. It was really in 2001 that we first declared WebSphere as a platform.

In 2002, the industry really got focused on the importance of integration to tie together all the different silos. This was a real problem. In the heyday, as the Internet was growing and all these applications were being developed, you ended up with silos of applications where you may have customer data in five or six different applications. You couldn’t look across them because the applications grew up independently or you acquired different companies that had different systems. So this idea about integration, making sure you got true value out of your existing systems and being able to integrate outside We started describing WebSphere as the integration platform.

We’ve really hit on that theme and evolved it and matured it as we’ve tied WebSphere into the basis of our On-Demand strategy. If you don’t have integrated business processes and systems you can’t be ‘on demand’ because your systems aren’t talking to each other. That’s the short history of WebSphere.

Websphere’s market share rose to 37 percent in 2002 from 31 percent in 2001. It has become the market leader in the applications server segment. BEA’s NetLogic has moved to second place. And WebSphere was named the number one vendor for integration and portal software by Gartner.

Where Websphere meets Eclipse

Where Websphere meets Eclipse

Ellison—IBM was behind the organization of the Eclipse Foundation. How do the efforts of the Foundation tied into your Websphere strategy?

Damassa—It was a proof point of our leadership in setting standards and delivering them. Here’s what happened.

In those days, and we’re talking in the 1999 and earlier timeframe, I was the project manager in charge of our tools. What we found was that every time we tried to create a new version of the tools it was for a particular environment and we weren’t reusing it. We said ‘we’re spending all of our time creating stuff and then translating it to these different products. We really should re-architect our tools into a workbench that we could then plug our modules into, reuse them and allow it to be pretty much open.’

When we started, it wasn’t with the intent of creating Eclipse. It was really about making the application development of our tools more efficient.

As we built it, we said ‘if we really want to help our customers we should open this up to a community of partners to build tools and plug in their specific tools—whether it’s web site development tools or specific testing and debugging tools or whatever.

We decided the best way to do that was to create an open source effort. We contributed our code base and that became the Eclipse platform. It has since been modified by the open source community and we’re one of the major developers in that.

As that becomes open source, we take that code out and that is what is WebSphere Studio Foundation. It is the basis of all of our tools. All of our tools are based on what is evolving with Eclipse.

Ellison—As that evolution occurs, what are the implications for WebSphere?

I’ll take off my parochial WebSphere hat and put my industry hat on.

One of the biggest plusses Microsoft has is its strong tools but those tools are built around developing Microsoft applications, Windows applications. Our feeling is no one vendor has the market cornered on good tools.

By creating this open platform for Java-based development, we are helping to create a robust set of tool offerings to meet all kinds of different needs for customers. So we’re focused on promoting Java—and all kinds of participants in the Java marketplace—to build a great set of tools as an alternative to using Microsoft tools to build Microsoft Windows applications. On that count, we’re doing phenomenal.

There’s more people joining Eclipse. There’re more products every day coming onto the Eclipse platform. Now our job at Websphere is to compete with the other people creating Eclipse-based tools for those areas where we decide we need WebSphere-specific tools.

We want people to buy WebSphere Studio and those kinds of products over competitor products that are also based on Eclipse. So we have to deliver the right function and ease of use capabilities. And we’ve been doing a very good job. Our Studio growth has been phenomenal.

Now as we go forward, there’s an interesting phenomenon in the development space. Application development is a business process. You start from defining requirements all the way through building code, integrating systems, testing the code and then maintaining the code and modifying it. If you’re efficient at that process, you reduce your costs and you get your project done faster. If you’re inefficient, it’s the reverse.

What about Rational?

What about Rational?

Ellison—How does IBM’s acquisition of Rational Software fit into your competitive strategy?

Damassa—Rational brings a whole development process that’s been recognized as industry best-in-class that our tools are very much integrated with. What you’re going to see going forward is a tighter linkage and integration between the WebSphere tooling and the Rational portfolio to create a complete end-to-end application development process that companies like BEA don’t even approach.

Ellison—What can we expect from Websphere in the coming months?

Damassa—One is the theme of adding value around the infrastructure so it’s not just an apps server or a portal or a tool, it’s about managing your business. We have tools that help you model your business processes. You can create the actual code with Websphere and the integration technologies underneath and then, over time, look at how your business runs, do metrics to determine if your business is working the way you want it to and, if not, identify where are your bottlenecks and change the process and have that be substantiated in the code.

Applications development is a process and an evolution. A lot of people think ‘I build an application and then I stick it in a closet and then I don’t change it’ or ‘I buy SAP and I secure all my business processes to that and then I pour concrete over it.’ We don’t believe that. We believe your business evolves. It changes on a daily basis. Your business processes have to change. Therefore your software infrastructure has to be flexible enough to adapt as quickly as the market is changing.

You’re going to see more announcements around things like business process and performance management, around our industry solutions, and how we’re pushing the envelope into the vertical value space of helping our customers develop their industry focused and business-focused solutions. That’s one area.

You’ll see the most activity in the first half around the business performance, business process management, industry solutions, and the Express component of what we’re doing—which is for the small and medium businesses. Throughout the year there will be different announcements around Express.

The other area where you’ll see in the second half (of this year) is that we’re going to continue to drive our leadership in the core technology around on-demand and quality of service and scalability and security. All this stuff is great in terms of building solutions but if the underlying infrastructure doesn’t scale, if it’s not usable in an extended network environment, if it doesn’t have the quality of service that a lot of our customers need, it doesn’t do you any good.

Websphere v. BEA, .NET

Websphere v. BEA, .NET

Ellison—BEA’s WebLogic has been your primary competitor. How do you contrast the offerings?

Damassa—One, in the breadth of the capabilities in the platform. Frankly, we have a broader set of assets that we bring to bear in two dimensions. One is additional components. One is a portal. They have a core application server. They have integration technologies. We have not only the Java-based integration technologies but we have products like MQ Series. It has the leading market share in message queuing which is another set of message-based integration technologies. So I think we have a broader set of components, broader functionality in our components. And frankly what’s exciting now is we’re making a move to help our customers accelerate this application development and integration strategy. We do that by providing them some best practices and components within what we’re delivering.

So, for example, our commerce set of application assets is integrated with our portal and with our integration technology. It provides things like catalogs, shopping carts and commerce level functionality that our customers can use to deliver a solution without creating these things themselves.

Similarly we’re moving into industry solutions where we’re tailoring our portal offerings and integration technologies, in terms of processes, around specific industries. We’ve identified 12 industries, five solution areas in each, where we’re leveraging our knowledge of industries and customers to help create reusable assets and content to shorten the development lifecycle. In effect, we are stretching the
definition of middleware. We’re moving beyond the classical middleware transactions servers and integration technology into providing additional capabilities from a content perspective. That’s one dimension.

Another dimension is that we don’t stop with just the integration and transaction middleware. We are a part of an integrated portfolio from our software group. We bring a database to the market. We bring collaborative capabilities with our Lotus portfolio to the market. We bring systems management and security to the market with Tivoli. All of these things are integrated. So it’s a much broader portfolio that BEA can possibly bring to the table.

Ellison—Do you consider Microsoft’s .NET a competitor?

I would consider Microsoft a competitor. .NET is what they’ve described as their technology for solving some of these integration problems. We use Java and related open technologies to compete with what Microsoft’s delivering with .NET. But .NET is embodied in the Microsoft proprietary product. Their server is really part of their operating system. Our strategy is really focused on the idea of choice. A lot of our customers don’t have Windows everywhere. They’ve got Linux servers. They’ve got UNIX servers, Sun, HP… They’ve got IBM mainframe technology. You certainly aren’t going to rewrite all those systems in Windows to get the full benefit of what .NET promises. We deliver that same thing in a heterogeneous environment instead of a proprietary environment. We’ve solving this for what we think is a broader set of customers based on open standards.

Channel manuevers

Channel manuevers

Ellison—Could you describe the specific channel programs you have in place for developers?

Damassa—For individual developers we have Developer Works which has millions of registered users who get all kinds of information about our products. And they get support, etc.

We’ve got a very aggressive recruiting and partnering strategy around ISVs. In 2003 we had over 500 new apps ported. We had over 2800 active ISV solutions. In 2003 we had over a thousand partners in our Websphere Express enablement program. These are new partners coming to the platform based on the Express portfolio and technologies.

So we are seeing double and triple digit growth in terms of solutions partners growing the platform.

There are programs around all of these things in terms of our ISV enablement. We have virtual Websphere innovation centers where we provide capabilities for our partners to come in and learn and get mentored. We grew the number of those mentors from, I think, 20 to 34 in 2003 so we’ve got strong growth in a lot of these program areas.

We understand and value the partners in the channel and what they’re doing. When we go out and survey the customers and ask them why are they buying middleware, 61 percent say they buy middleware because of a specific application. When we ask them how do they buy middleware, they say that 63 percent of the time they buy it in combination with other products. So, to the point I made earlier about having these other elements in our portfolio, that’s the way customers are buying.
They want to make a middleware decision that includes multiple components.

When we asked them what percentage of their middleware projects involve solutions providers, 79 percent of the customers say they involve solutions providers. When we asked, in those instances where a partner was involved, who made the middleware decision or influenced it, in large accounts it was about 40 percent of the time that the partner made or influenced the decision. In comp-anies of less than 100, it was about 48 percent of the time that the partner alone or the partner jointly with the customer made or influenced the middleware decision.

When you see numbers like that they say ‘hey, channel partners and solutions providers are critical to our success.’ That’s where our commitment to making partners successful comes from.

Ellison—And are you actively recruiting partners right now?

Damassa—We did a recent survey of partners of our competitors and asked them: What is the likelihood you’ll become an IBM software business partner over the next 12 months?

This was done in October of 2003. We surveyed Microsoft partners, Oracle partners, BEA partners, HP partners, etc. They could say they were extremely likely, very likely, might or might now become an IBM partner, not very likely or definitely will not. If you take the first category of extremely likely or very likely, the one that stood out was BEA. Fifty percent of BEA partners we interviewed said they were extremely likely or very likely to become an IBM business partner in the next 12 months. Behind them, the average for Microsoft, Oracle and HP was 24 percent. So BEA was much higher in terms of their partners wanting to look at some alternatives. I think that’s directly in relation to the fact that they made some very public statements about the fact that they’re backing off their support of partners and moving to a direct sales channel.