Analysts: Oracle-IBM Integration May Shake Up Apps Market

Analysts suggest Oracle's recent corporate acquisitions will provide the impetus for ground-breaking support for IBM WebSphere middleware products in the Project Fusion applications.

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SAN FRANCISCO—At Oracles OpenWorld user conference here on Monday, Charles Phillips, Oracles co-president, opened with a keynote address highlighting the companys Fusion strategy—middleware, applications and partnerships.

At the same time, Phillips touched on a partnership announcement with IBM that could, depending on the outcome, prove a ground-breaker in the IT industry, analysts said.

During his address Phillips outlined Oracles Fusion architecture—a blueprint of how the company is going to move its applications forward, based on Oracle Fusion Middleware. He drilled down into the concepts behind Fusion middleware—a stack of components that add functionality to the application server, such as business intelligence, business process modeling and process management. Phillips touched on Project Fusion, and how Oracle Corp. intends to expose interfaces, service-enable its applications, and bring the best-of functionality together in a suite of extensible, process-oriented applications.

/zimages/4/28571.gifPhillips also told attendees that the company would provide "lifetime" support for its expanding list of applications? Click here to read more.

Then almost as an aside, while framing Oracles new hot pluggable concept that enables third-party applications to work in the Oracle environment, Phillips said that "Oracle will work with WebSphere products when we get to Fusion."

While some sort of formal relationship between Oracle and IBM has been looming on the horizon—Oracle executives have on occasion mentioned that they are working to get closer to IBM, and its likely no coincidence that a majority of Oracles recent acquisitions have an IBM tie-in—its not been clear how deep the relationship with IBM would go.

And its still not. But the basics are in place.

Oracle will certify IBMs WebSphere middleware stack as a native platform for the next generation of Oracle Fusion applications. It will, essentially, enable a separate run time environment for IBMs WebSphere middleware products for the Fusion applications.

The two companies will also work together to develop open standards where there are none, for example in the area of Web services.

Beyond that, not much is known.

"This could be an industry-changing event," said Joshua Greenbaum, principal of Enterprise Applications Consulting, in Berkeley, Calif. "Does this mean the [Oracle] 9i Application Server is out, and WebSphere in? [A partnership between IBM and Oracle] is a first among equals, thats key. It serves notice on SAP that they have to do something with their application server."

To fully understand the impact of an IBM and Oracle alliance, there are still questions to be answered including a time table and a technology roadmap, Greenbaum said.

According to Greenbaum, when Oracle co-president Safra Catz was asked about the IBM relationship, she said, "Things are changing. We are IBMs largest ISV. The value of a platform is the number of applications on it. This is the world we live in."

Though discussions around a project definition and scope have begun between Oracle and IBM, there have not been any concrete plans drawn up to determine which "areas of cooperation are most beneficial," according to a statement by IBM.

/zimages/4/28571.gifOn security, will Oracle follow in Microsofts footsteps? Click here to read more.

Oracles relationship with IBM still leaves the database question unanswered. To date, Oracle applications have run on Oracles database—period—which leads to a persistent question around Project Fusion: Will Oracle support IBMs DB2, or other databases outside of its own?

"Were still working on that. We havent come to any conclusions," said Phillips in a Q&A session with press and analysts. "There are some tradeoffs to give up with not being optimized on the Oracle database. If we dont use it [work becomes] more manual, less secure. So weve got some confusion."

To help better understand what it would mean to optimize the Fusion applications to an outside database—primarily IBMs, given PeopleSoft and JDE users reliance there—Phillips said Oracle has created, among other initiatives, a Fusion Advisory Council to see what customers want.

Though a big partnership, IBM is not by any means the only relationship Oracle is pursuing.

A company that long held the reputation of being closed—even hostile—to partners, Oracle is throwing open the flood gates, attracting partners at a dizzying rate (many through acquisition). Phillips said.

"We now have 15,000 partners," said Phillips during his keynote address. "Before we had 10 to 20 percent."

/zimages/4/28571.gifActions will speak louder than words when it comes to partners, says Ziff Davis Internets John Pallatto. To read more, click here.

As part of its new focus on developing and promoting a partnership ecosystem, Oracle announced today its One Stop Support for ISVs. For those Oracle certified partners, Oracle will "select some of them" and make them part of the Oracle support program, said Phillips.

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