For years, a variety of industry analysts and bloggers have suggested that SAP jumpstart its Software-as-a-Service (SaaS) and broader Cloud initiatives with a major acquisition, such as SuccessFactors. Today’s news that SAP will buy SuccessFactors for $3.4 billion shows that the company’s executives have finally admitted that they can no longer rely on internal development and organic sales efforts to gain a meaningful share of the rapidly growing SaaS/Cloud marketplace.

I can’t say that I’ve been among those advocating this type of bold move because I’ve been a part of a similar acquisition which failed to achieve its strategic objective, and I’m not convinced that SAP will be able to transform its business through this transaction.

Back in 1999, I worked for a fast-growing network professional services company, called International Network Services (INS), which was acquired by Lucent Technologies for $3.7 billion, or 12x revenues! Lucent’s goal … Read More »

IBM announced its intention to acquire Cast Iron Systems today, bringing to an end the long-standing parlor game of which integration tool vendor would be the next to be acquired after Workday grabbed Cape Clear in 2008.

This is an important endorsement of the importance of the integration tools market in general, and Cast Iron Systems in particular.

Integration is often listed as one of the top three concerns among IT and business decision-makers who are thinking about migrating to the ‘cloud’, along with security and reliability.

According to IBM’s software head, Steve Mills, Cast Iron Systems fit IBM’s acquisition criteria by offering “Adjacency” and “Synergy” that can enhance IBM’s capabilities and revenue opportunities in the following areas,

Websphere middleware
Process management services
Professional and hosting services
Cloud enablement solutions

The integration tools sector has been very competitive with Boomi, Hubspan, Informatica and Pervasive Software recognized as the other leaders.

Cast Iron Systems has differentiated … Read More »

A series of service outages over the past few days has brought into focus all the worst fears about the ‘cloud’ computing and Software-as-a-Service (SaaS) movement. These incidents have also demonstrated how data center experience doesn’t necessarily translate into cloud computing excellence.

The most damaging outage affected T-Mobile users who lost their contact information in a SideKick server snafu by a Microsoft subsidiary, amazingly called “Danger”.

A severe data center outage grounded Air New Zealand last week. This time, IBM proved to be the culprit responsible for mishandling one of the airline carrier’s mainframe systems as part of a traditional-style outsourcing arrangement.

The cloud computing world wasn’t spared when one of the most promising SaaS vendors also had a system failure last week. Unlike the IBM and Microsoft outages, Workday was able to fully restore its customers’ records and salvage its customers’ satisfaction for important two reasons:

It had the … Read More »