IBM Launches Open Plan for Vertical Markets

In an effort to win over verticals and enhance its services opportunities, IBM plans to bundle open-source technology with open standards and release patents when necessary.

IBM has added key weapons in its arsenal for attacking vertical markets: its expertise with open source and open standards and its vast intellectual property reserves that can be released at a moments notice.

The Armonk, N.Y., systems maker plans to bundle open-source technology with open standards and release IBM patents, when necessary, in an effort to go after verticals and enhance its services opportunities, company officials said.

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The first three targets are the , and markets, but Bob Sutor, IBMs vice president for standards and open source, said the company will be targeting all verticals now supported by IBMs PartnerWorld Industry Network.

"Our target is pretty much every industry," Sutor said, adding that IBM will soon be pushing its new strategy into areas such as the banking, aerospace, telecommunications and hospitality industries. "Weve been aggressive around standards and open source, and now were focusing on open standards and open source for particular markets."

IBMs program mirrors efforts by companies such as JBoss Inc. and MySQL AB. IBM is planning to bundle open-source technology aimed at specific markets to win new business and to set up opportunities for its services organization.

"This first step of opening up IBMs own intellectual property for use in open standards—covering software protocols, file formats and interfaces—continues IBMs shift from technology vendor to high-end business solutions provider," said Navi Radjou, an analyst with Forrester Research Inc., in Cambridge, Mass. "In the process, IBM can redirect its in-house inventor resources to higher-end consulting activities."

As part of the new strategy, IBM is likely to have to open-source portions of its key components. Sutor said key technologies that IBM might open-source include pieces of WebSphere and MQ messaging technology.

JPMorgan Chase & Co. is leading an effort to deliver an open-source messaging middleware technology, AMQ, which is akin to IBMs MQ.

"We are aware of it," Sutor said of the AMQ effort. "We have a very practical approach to how we deal with open source. There are particular product areas where we would consider open-sourcing them." But rarely would it be "the whole product," he said.

"IBM isnt doing this out of pure altruism," said Radjou. "IBM seeks to speed the commoditization of OS and database functions and to increase the odds that evolving technologies become de facto standards on top of which higher-level business innovations can be developed."

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Ray Barker, CEO of rSmart Group, in Phoenix, said IBMs release of more than 500 patents earlier this year "absolutely helped my company. Anything that benefits open source and frees up development resources can help companies like ours."

rSmart partners with IBM on the Sakai Project, an open-source software development effort involving more than 70 institutions, mostly universities.

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