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

August 13, 2004

While many programmers and IT managers talk about Web services and service-oriented architectures , the technologies aren’t nearly as valuable as when they can be tied to business processes to help loosely coupled applications conduct transactions.

That is why a nascent niche known as business process management (BPM) is holding increasingly more sway over a number of vendors looking to solve customers’ software integration problems. Vendors realize it’s not enough to be able to allow Web services applications to talk to one another. They need to coordinate disparate applications with their businesses, too.

Vendors and analysts discuss the BPM market in optimistic tones because there is a lot of money to be made. Recent IDC research pegged the market as somewhere in the vicinity of $750 million in 2003 and expects it to grow at a compound annual growth rate of 25 percent, reaching $1 billion by the end of 2004.

Microsoft (Quote, Chart), IBM (Quote, Chart), BEA Systems and Oracle (Quote, Chart) are among the active players trying to manage or accelerate business processes. There are also pure-plays like HandySoft, Intalio and Active Endpoints, hungry to cover the bases their giant rivals don’t.

Who will prosper and who won’t is anyone’s guess, but there is some considerable momentum happening in the BPM space.

BPEL or Bust

BPM is like any other programming model in that it is unlikely to see significant traction in the market without interoperable standards that vendors can use. That’s why Microsoft, IBM, BEA Systems and others have written a specification that addresses the idea of tying technologies to processes.

Business Process Execution Language (BPEL) is a language for specifying business-process behavior based on Web services. Amidst controversy, its authors submitted version 1.1 to standards body OASIS, confident that the spec is advanced enough to use even though it’s not officially part of the standards canon.

“Our vision remains to help customers realize the potential of leveraging our technologies to improve business processes, such as by moving towards a service oriented architecture,” said John Evdemon, Microsoft architect and co-chair of the OASIS Web Services BPEL technical committee. “A core theme of service orientation is that the services replicate the business capabilities of the company.”

OASIS expects to ratify BPEL some time this year. BEA and IBM are hashing out BPELJ, a Java-based version of the spec.

Some vendors believe BPEL 1.1 is as ripe for use as it’s going to get, going so far as to build or acquire technology based on it. For example, IBM recently cast aside its proprietary business process modeling technology in favor of BPEL.

Rob Cheng, product marketing director of Oracle’s application server and tools division, said BPEL and BPM can flourish now that core Web services components SOAP , WSDL and UDDI are in place.

“BPEL has not fallen out the end of the OASIS process, but it’s essentially a finished standard,” Cheng said. “Web services just gave you ways to connect things in a point-to-point fashion. BPEL is the Java of SOA because it gives you a portable, interoperable layer for business process definition.”

That’s part of the reason why Oracle acquired standalone BPM provider Collaxa and incorporated its BPEL Server into its own product suite, renaming it the Oracle BPEL Process Manager.

The match appears to be a perfect fit. Like Oracle, Collaxa’s software was designed to run on any J2EE server. Moreover, former Collaxa CEO Edwin Khodabakchian and current Oracle vice president said it was important that Collaxa team with a company that had both a strong application server and database server on which to rest the BPEL Server.

Start Your Endpoints

BPM up-start Active Endpoints doesn’t enjoy the luxury Oracle does of having a lot of cash to spend. Nor has it been, like Collaxa, on the market to get picked up by a larger company. That’s just fine with CEO Fred Holahan.

Holahan, a veteran of acquired companies like GemLogic and SilverStream, likes the idea of just starting out in the market. Active Endpoints is only a year and a half or so old, but it recently made noise by concurrently releasing its Active WebFlow software engine and open-sourcing it under the GPL .

“There is a rising tide in the marketplace around BPEL,” Holahan said. “The BPEL 1.1 spec is good. It’s very functional and [OASIS BPEL technical committee members] understand where the deltas will be. There have been a lot of competing specs around process management, but when IBM and Microsoft get behind a spec, you can be pretty sure it will be a winner.”

Holahan is talking about Business Process Modeling Language (BPML) and the Web Services Choreography Interface (WSCI), neither of which have the traction or support BPEL does. By open-sourcing its BPEL software, Active Endpoints believes it can stand out in a crowded market. Some analysts agree.

David Kelly, founder of Upside Research, a firm dedicated to studying BPM, said Active Endpoints will likely raise awareness of BPEL by putting its code under the GPL.

“To really make this an important development, though, ActiveBPEL will need to generate broader industry support through additional partnerships or contributors,” Kelly said.

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