Big Blue's big database gambit
By Philip Russom, Special to ZDNet
Philip Russom suggests that IBM's acquisition of Informix
Software presents as many problems as promises.
COMMENTARY--Does IBM know what
it's gotten itself into?
On the upside, IBM's acquisition of
Informix Software promises to bring approximately 120,000 new
customers to the Data Management Group, the home of the rising star
DB2, as well as a few thousand talented database professionals and a
number of useful pieces of technology. On the downside, however, the
acquisition also brings a plague of problems, such as a history of business
blunders by Informix management, thousands of ticked-off Informix investors, and--worst of
all--several legacy database management systems (DBMSs) that entered Informix Software through its
acquisition of Ardent Software.
Lest we forget, Ardent had evolved into a kind of elephant graveyard, where ancient and hoary IT
beasts came to die (after disgorging considerable amounts of maintenance revenue, of course). As the
final resting place of woolly mastodons like VMARK, O2 Technology, and UniData, Ardent had
enough maintenance revenue from legacy customer bases to fund a new data integration product called
DataStage, as well as to fund acquisitions of Prism Solutions and Dovetail (which are now folded into
DataStage).
Informix, too, had gone through its share of acquisitions, but it collected newer and hipper database
vendors like Red Brick and Cloudscape. By acquiring Ardent, Informix entered the bone yard
business. Informix executives felt they needed the data integration technology of DataStage to enable
its burgeoning data warehouse business and its fledgling corporate portal effort.
To get this princely product, Informix was willing to accept the warted toads in Ardent's motley
collection of legacy DBMSs.
Yet, Informix soon found that no amount of kissing would turn these frogs into princes. So it embarked
on an aggressive upgrade and migration campaign called Arrowhead.
But Ardent's crony customer base, steeped in three-decade-old technologies like hierarchical
databases and Pick systems are, for the most part, either incapable of fathoming the cutting edge of
object-relational databases or (more likely) do not see a return on investment from porting to a more
modern platform. Hence, Informix Software found itself supporting seven code streams for DBMSs
(some insiders claim there are eleven code streams!), with little or no hope of discontinuing any of them
any time soon.
That's a very heavy R&D millstone to wear, not to mention the confusion created by marketing (and
trying to differentiate) seven DBMS products. In an attempt to bring order to the bone yard, Informix
restructured in late 2000 to create a holding company called Informix Corporation (NasdaqNM:IFMX
- news). It contains two subsidiaries: Informix Software (with a host of DBMSs) and Ascential
Software (with Ardent's DataStage and Informix's Media360, iDecide, iSell, and whatever they call
their portal today). But this created its own points of confusion, because the Red Brick Server (for
data marts) and XPS (for high-end data warehouses) ended up in Informix Software, while the
complementary product DataStage (a data integration platform for warehousing) went with Ascential.
In the end, the restructuring of Informix which simply sorted elephant bones by type burned up a lot of
resources without any negligible benefit.
Big Blue's big gambit
All this cannot have gone unnoticed by IBM executives. In the course of due diligence, they must have
opened a lot of closets, some bursting with pachyderm skeletons. It leaves me wondering: What's
IBM's real goal, and is it worth assuming the management of an elephant graveyard? Before answering,
let's look at the effect of the acquisition on competitor Oracle Corporation (NasdaqNM:ORCL -
news).
On the one hand, Oracle's overtly competitive corporate culture had most employees making nasty
cracks immediately about the undignified death of Informix. But the passing of this once-great vendor
doesn't mean they lost a meaningful competitor. After all, Oracle trounced Informix long ago. On the
other hand, Oracle's savvy executives most likely had a "Maalox moment" upon hearing of the
acquisition. They're reaching for antacid, because their most formidable foe--the data management
division of Big Blue itself -is suddenly much larger and stronger. When that great knife known as
market share re-carves the DBMS pie chart, IBM's slice may soon exceed that of Oracle.
And--in case you missed it--that's IBM's real goal with this acquisition. If it's a greater share of the
DBMS market that IBM wants, then acquiring Informix Software is a fast and relatively inexpensive
way to get it. But let's hope that managing Informix elephant graveyard doesn't prevent IBM from
trouncing Oracle.
Philip Russom is an independent industry analyst and product marketing consultant, serving
software vendors with business intelligence and database management products. You can reach
him through his Web site at www.philiprussom.com. |
