A few minutes before 3 PM MT yesterday, I got an email asking me to attend a breaking BEA conference call at 3. Fortunately, I had the slot open (increasingly rare these days), and dialed in. Generally these calls mean that the firm has made an acquisition (if BEA had been acquired, I would likely have gotten an email from the acquiring party rather than BEA so that wasn’t it), have a major product announcement, or less frequently that they’ve signed a big partnership. While the conferencing service had us on hold for a couple of minutes playing some truly awful music, I was speculating on what, in fact, the breaking news might be. Something open source? A spin off of one their product lines? Well, I was wrong on all counts. Instead, as you’ve all probably seen by now BEA used the call to announce their intention to acquire Plumtree, one of the last remaining standalone commercial portal products. Before I get to the Q&A, the standard disclaimer applies here: BEA’s a customer of ours, while Plumtree is not. So read into that what you will. on to the first question.
Q: I haven’t been hearing much about portals for the last year or so, why does this deal make sense in that context?
A: Well, despite the fact that portals might not be top of mind in the blogging world, they’re still an important cog in many an enterprise infrastructure. I’ve been fairly unambiguous in my belief that thin client based infrastructures are becoming far more compelling for previously unheard of functions, from email to CRM to – gasp – ERP. Portals are the enterprise aggregation point of this trend, where big firms can surface a variety of applications and content sources within the context of a browser – thus eliminating the expense and management headaches of traditional client/server architectures. Another way to think of enterprise portals is as the enterprise equivalent of Google Maps mashups, hybrid blends of separate services.[1] So while they don’t get the pub they once did, portals play a vital role to many medium and large enterprises.
Q: Well, if portals are such a hot commodity, why did Plumtree agree to sell out?
A: Well, I don’t know that I’d refer to them as a hot commodity, but the reason to me is simple: it’s difficult for any 415 person company, however talented, to compete with industry giants like BEA and IBM on a level playing field. There are ways of tilting the field in your favor, as JBoss has shown by leveraging open source, but the surprising thing to many was that Plumtree remained independent as long as it did. This really is a credit to their focus on the business side of portals, which we’ll get to in a moment. In the end, I have to believe that a deal like this was simply a matter of time. Not only would a standalone vendor like Plumtree have to continue staving off competitors who’s engineering resources number more than their total headcount, they would undoubtedly increasingly face competition from open source projects like Liferay and Exo which are receiving due consideration from open minded Fortune 500 architects. And that’s just the enterprise category, we haven’t even gotten into the simpler, lighter weight alternatives like Mambo from the PHP world, or Sharepoint from Microsoft. Plumtree did exceedingly well, all things considered, in fighting a one front battle, but the opening of a second front – the low end – likely made going it alone a difficult proposition for the portal vendor.
Q: Got it. So what’s in it for BEA?
A: Well, as my colleague mentioned to me this morning BEA now has the ability it lacked to sell to a new audience of .NET developers which, while introducing some complications, does open up a new channel. That’s sort of a good news/bad news deal, as he put it. According to Forbes, the win for BEA is the broadening of its customer base. This was a point stressed by both BEA’s CEO Alfred Chuang and CTO Mark Carges – that BEA and Plumtree were really different markets with minimal overlap, so the combination is a 1+1=2 rather than 1.5 situation. I’m not sure I buy that, myself, given that I know many of Plumtree’s customers are big businesses that would otherwise be in the market for BEA-like solutions. As different as the strengths of the two products are, I simply can’t believe there won’t be situations – a fair number of them – where they’ll be competitive with each other.
Q: Well, ok, what do you think BEA actually gets out of the deal then?
A: Well, I think what’s actually critical is that BEA just acquired a company that knows how to sell portals to business people. That point, to me, cannot be stressed enough. As I told one reporter this morning, BEA and many of the other J2EE portal players could sell portals to CIOs and enterprise architects in their sleep. But like their respective pitches for SOA, selling to the actual consumers of portals – regular, line of business folks – BEA, along with most of its J2EE brethren, were less than stellar. That, however, is something Plumtree excelled at. I had the opportunity a while back to attend one of their customer sessions in Massachusetts entitled “No Empty Portals,” and there was little discussion of JSR 168, EJBs and the like – it was instead a talk about how various Plumtree customers had built portals that business people actually liked, and enjoyed working with. They talked about portlets for employee classified ads, comic strips, and other seemingly frivolous things that served an unexpectedly important purpose – they brought people back to the portal. In keeping users involved and interacting, they kept the product from the fate of many a portal product – shelfware. When helping to design part of a portal initiative for a customer in my SI days years ago, the customers’ architects I was working with had actually forgotten they even owned an Epicentric license (long since acquired by Vignette) – that’s how little they got out of that buy. So the ability to sell business customers on and engage them with portals, to me, is the best asset that Plumtree brings to the table, and a likely driver behind the acquisition.
Q: Assuming the deal goes through, what does this do to the competitive landscape? What’s the outlook for the combined entity?
A: Well, as far as the competitive landscape goes, it’s consolidation pure and simple, no different than we’ve seen in the past with the application server market and other enterprise software segments. As far as what the outlook is for the BEA/Plumtree offerings, I think it’s interesting. Tactically, it should be a boost to Plumtree’s sales because it removes at least some of the questions potential buyers might have about longer term viability, support, etc. The strategic outlook is less clear, for roadmap issues. The road ahead for BEA’s own portal offering is likewise hazy; clearly its reputation for scaling outstrips Plumtree’s, but apart from that Plumtree’s offering would seem to be more usable to a wider audience – and perhaps the most important one – the business person, as Carges alluded to on yesterday’s call. I don’t know about you, but if I have one product that business people can use and one that they can’t, or at least are less inclined to, I’m probably going with the former unless I have a really compelling reason not to. So the product roadmap has me a bit confused.
Q: In what way?
A: Well, all the participants in yesterday’s call promised that the product lines would be maintained as separate virtually indefinitely. In the short to medium term, this obviously makes sense, as all three codebases (BEA, and presumably a Plumtree Java and a Plumtree .NET) are undoubtedly fairly complex. But I would have expected more discussion of at least the possibility of a consolidation somewhere down the line – maybe just for the Java versions, incorporating the best features from each product, etc, etc. But there was little to none of that. That seems odd.
Q: What does this mean for other portal vendors like IBM, Oracle, or Sun?
A: Well, from an IBM perspective, probably not a great deal. Oh, one of their major competitors just acquired a popular and competitive offering, and undoubtedly that will be a point of concern for some of the Portal folks over at IBM, but IBM’s walking a different path these days. For customers that want a portal and nothing else, they have that option, but the bigger picture strategy from them is Workplace – which is about trying to blend the best of thick/rich client and thin/portal client worlds. For a very positive view on Workplace, you might check out frequent RedMonk guest Gary Edwards’ comment over on one the ZDNet blogs here.
Oracle’s probably likewise not thrilled that one of their middleware competitors has acquired some new capabilities and – in theory – a new channel, but the conventional wisdom regarding Oracle’s software position these days has them more focused on being an all-in-one supplier of business applications. A standalone portal solution then would seem to be less of a concern for them.
As for the folks from Sun, they likewise are not really competing on a single product basis in this space (though they will certainly sell the component standalone, it’s not their focus), pushing instead the per employee pricing integrated Java Enterprise System offerings. So this announcement, while relevant, is not likely to affect their field sales force as much as might otherwise be expected.
Q: Any other important considerations?
A: Well, the really interesting one from where I sit is whether or not Plumtree’s business-savvy DNA will be overwritten by its acuirer’s strongly technical culture, or whether or not BEA can practice some recombination on-the-fly and apply some of the Plumtree lessons to other areas of its business, like the aforementined SOA product set. If BEA twelve months from now is marketing successfully to your Joe Line-of-business, the technical assets from this deal might become an afterthought. For now, however, BEA has to hope that it can successfully manage two separate product lines (and three separate codebases), while maintaining complimentary but not overlapping marketing messages amidst competitors that we will be FUDing them at every opportunity.
Q: Anything I should have asked but didn’t?
A: Well, I do find it interesting that most of the coverage of the announcement that I’ve read has turned a blind eye towards potential open source or lightweight threats to BEA/Plumtree, as well as other portal players. If you talk to James McGovern, he’ll tell you that every enterprise architect should be actively considering some of the available open source packages, and that’s with a relatively immature open source portal landscape (as compared to, say, application servers). Likewise, I think the proliferation of web services may represent a long term portal-as-central-aggregation point threat, because services like Greasemonkey – kluge as they are – empower ordinary users to build their own portals with little or no help from IT. This may all be more of a strategic than tactical threat, but it’s something that portals will ultimately have to contend with, like it or not.
[1] Interestingly, the consumer side services are generally more adept at actually blending the services, while enterprise portals have typically been more centered around simple aggregation than service recombination.
