Wednesday January 9, 12:00 am Eastern Time
BEA caps off partnerships with Deloitte consulting
By Ilaina Jonas
NEW YORK, Jan 9 (Reuters) - Software maker BEA Systems Inc.(NasdaqNM:BEAS - news) on Wednesday said it nailed down a partnership agreement with computer services giant Deloitte Consulting, a unit of Deloitte Touche Tohmatsu, capping off its strategy to compete against its No. 1 rival IBM.
The deal with Deloitte marks the final piece of BEA's plan to partner with the world's largest computer services consultants. The partnership network, is designed to give BEA access to customers around the globe and compete with the IBM Global Services, the giant services arm of International Business Machines Corp.(NYSE:IBM - news).
The accord completes BEA's full sweep of computer service providers -- Cap Gemini Ernst & Young , Computer Sciences Corp. (NYSE:CSC - news), EDS Corp.(NYSE:EDS - news), Accenture Ltd (NYSE:ACN - news), PricewaterhouseCoopers, Andersen and KPMG Consulting Inc. (NasdaqNM:KCIN - news).
``They have the ability to go in and compete side by side with IBM Global Services or any body else who goes in with a total hardware, software, services solution and bid a single invoice, single source, single cost of computing,'' said Rauline Ochs, senior vice president of BEA's Worldwide Partner Initiatives.
``To tell you the truth that's what our investment is intended to do and we're seeing the return on those results,'' he added.
BEA is the leading maker of applications server, used as a base for computer to programs. Its core product, WebLogic, competes against IBM's WebSphere application server, which is used to enable businesses to put more and more of their operations on the Internet. Both have expanded the role of the application server to include other functions such as electronic commerce, portals and linking computer programs together.
In the past year, IBM, whose huge sales force can offer hardware, software and its massive Global Services, has ratcheted up the competition and has gained more ground as corporations seek to do more of their business with fewer vendors.
During the past 19 months, BEA has worked to counter IBM's global power by partnering not only with the largest integrators, but also with hardware, such as Sun Microsystems Inc.(NasdaqNM:SUNW - news), and software vendors such as PeopleSoft Inc.(NasdaqNM:PSFT - news) and Manugistics Group Inc.(NasdaqNM:MANU - news).
BEA said it now has about 10,000 partner representatives trained to sell BEA products, 5,900 of whom work for computer services companies. By 2004, BEA plans to derive about 40 percent of its revenues from its partner relationships, Ochs said.
``It puts us on equal footing to lead with a services practice and with hardware software services underneath and really puts our competitors in the position to have to compete with us on product capabilities, product pricing and and other places where frankly we feel we're superior,'' she said.
In its relationship with the service companies, BEA invests in education, engineering, training and technical support, to ensure that their partners have the expertise to sell BEA products and that some of the products are built on BEA.
It gets together with the partner and selects the largest customers they have in common and forms a united selling plan.
``We compare notes to see who's got what contacts in each account, who's got budget this year, who's making decision who's not,'' Ochs said. ``Then we put a sales initiative in place to go down and bring business together.''
As more of its revenue comes from service partners, BEA said its own services revenue will decrease to about 30 percent. Services accounted for 42 percent of its total revenue during the third quarter.
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