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Vendors Eye Slice of $1B BPM Pie
By Clint Boulton

August 13, 2004

BPM’s Best of Breed?

Intalio’s Chief Strategy Officer and Co-Founder Ismael Ghalimi knows the market as well as anyone. He considers the open-source efforts of Active Endpoints and others more or less cop outs for failed approaches.

“It is one of desperation, similar to what Oak Grove Systems did two or three years ago when reselling their source code for $50K a pop (royalty-free),” Ghalimi said. “I know five to 10 pure BPM players that are contemplating similar moves today.”

Instead, Ghalimi said Intalio’s ambitious goal is to become the leading independent BPM systems vendor in the sea of larger companies. To get there, Intalio has embarked on a BPM platform called Application Process Extension (APEX), which the company will unveil in September.

By many accounts, APEX is very different. It advocates “zero code development.” Code has traditionally been one of the hobgoblins of consistent integration, tripping up programmers and setting consolidation projects back.

With APEX, Intalio aims to let process designers automate business processes without having to write code, allowing them to handle large, legacy ERP or SCM applications from Oracle, SAP or PeopleSoft. By taking the coding out of their hands, Intalio hopes to help the enterprise save time and money.

Analysts’ Final Word

IDC analyst Dennis Byron studies BPM, but he knows it is business process automation or software that speeds the delivery of business processes. Byron said the roots of BPA lie in the dot-com era of business-to-business integration but never really took off for lack of investment in technology and standards.

“The stuff we talked about during the dot-com era, which has left a bad taste in many peoples’ mouths, is actually beginning to happen,” Byron said. “Suppliers, customers, primarily through extranets and public exchanges are finally beginning to connect.”

Clients are using single brands to do integration from one application set, writing products on a point-to-point basis, or buying from several vendors. Byron believes that people would prefer to have fewer components to deal with when putting together their infrastructure, making Oracle, BEA and IBM attractive.

Upside Research’s Kelly agrees, but feels pure-plays have a leg up on larger rivals.

“Large infrastructure vendors such as Oracle and Microsoft are simply not yet providing real, focused BPM solutions,” Kelly said. “I would certainly expect to see them move in that direction over time, but for the moment, the most interesting products are coming from the vendors focused specifically in the BPM space, such as Fuego, Savvion, Metastorm, and Handysoft.”

Byron, who is currently looking at roughly 75 vendors in the space, said the industry has hardly reached a maturation point and that consolidation is a foregone conclusion.

“This is a brand new industry; you typically don’t see it so early in the process,” Byron said, adding that BEA grew its integration basis over 100 percent last year, which demonstrates great promise for BPM. “And let’s not forget about the 8,000-pound gorilla in the room — Microsoft.”

Released in March, Microsoft BizTalk 2004 integration server is teeming with BPM capabilities. The company doesn’t break out market share for the group, and analyst firms generally focus on pure-plays in the BPM space so it is difficult to know how BizTalk is doing.

Really, who wants to bet against Microsoft here? As Microsoft Architect Evdemon said: “BizTalk Server 2004 supports BPEL so that customers can integrate business processes more seamlessly. This is compelling for any business that wants to increase efficiency through automation.”

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