Showing posts with label Garone. Show all posts
Showing posts with label Garone. Show all posts

Monday, March 05, 2007

BriefingsDirect SOA Insights Analysts on SOA Suites Vs. Best-of-Breed SOA, and Master Data Management

Edited transcript of weekly BriefingsDirect[TM] SOA Insights Edition, recorded Jan. 26, 2007.

Listen to the podcast here. If you'd like to learn more about BriefingsDirect B2B informational podcasts, or to become a sponsor of this or other B2B podcasts, contact Dana Gardner at 603-528-2435.

Gardner: Hello, and welcome to the latest BriefingsDirect, SOA Insights Edition, Volume 10. This is a weekly discussion and dissection of Service-Oriented Architecture (SOA)-related news and events with a panel of industry analysts and guests. I’m your host and moderator Dana Gardner, principal analyst at Interarbor Solutions, ZDNet software strategies blogger, and Redmond Developer News magazine SOA columnist.

Our panel this week consists of show regular Steve Garone. Steve is a former IDC Group vice president, founder of the AlignIT Group, and an independent industry analyst. Welcome again, Steve.

Steve Garone: Hi, Dana, great to be back.

Gardner: Also joining us again Joe McKendrick, research consultant, columnist at Database Trends, and a blogger at ZDNet and ebizQ. Thanks for coming, Joe.

Joe McKendrick: Thanks, Dana, glad to be here.

Gardner: Also Tony Baer is making another appearance. He is principal at onStrategies. Thank for coming, Tony.

Tony Baer: Hey, Dana, good to be here.

Gardner: We’re also talking with Neil Macehiter. He is a research director at Macehiter Ward-Dutton in the U.K. Thanks for coming, Neil.

Neil Macehiter: No problem, Dana.

Gardner: And last on our list -- we have a large group today -- Jim Kobielus. Jim is a principal analyst at Current Analysis. Thanks for coming along, Jim.

Jim Kobielus: Thanks a lot, Dana. Hi, everybody.

Gardner: For our first topic this week -- and this is the week of Jan. 22, 2007 -- we’ll begin with the notion of SOA suites, a merging and definable market segment. We’re going to be looking at how mature such suites are. I suppose we should also look at the distinction between the best-of-breed-approach, where one could pick and choose various components within their SOA arsenal, or a more complete suite, a holistic full-feature set with the benefits, trade-offs, and detriments of each of these approaches.

Jim, you’re the one who was interested in this topic. Why don't you give us a little set-up as to what you think the state of the market is?

Kobielus: Thanks a lot. Over time, we’ve all been seeing this notion of a SOA suite take root in the industry’s productization of their various features, functions, and applications. Now, the big guys -- SAP, Oracle, Microsoft, webMethods, for that matter lots of software vendors -- are saying, “Hey, we provide a bigger, 'badder' SOA suite than the next guy.” That raises an alarm bell in my mind, or it’s an anomaly or oxymoron, because when you think of SOA, you think of loose coupling and virtualization of application functionality across a heterogeneous environment. Isn’t this notion of a SOA suite from a single vendor getting us back into the monolithic days of yore?

This thought came to me when I was reading a Wall Street Journal article earlier in the week about SAP, “SAP Trails Nimble Start-Ups As Software Market Matures.” There was one paragraph in there that just jumped out at me. They said, “Some argue that SAP's slump highlights a broader shift under way in business software, in which startup companies wield an advantage over established titans. Under this traditional business model companies buy large, costly packages of software from SAP and Oracle to help them run their back-office functions and so forth, but as the business software industry matures, many companies already have the big software pieces they need, and feel little urgency to replace them.”

So, clearly SAP is then sort of a driver in the SOA suite arena for few years with NetWeaver. Is the notion of SOA suite an oxymoron? Are there are best-of-breed-suites? There are also best-of-breed SOA components, and I’m not sure that the notion of a suite, an integrated suite is really what companies are looking for from SOA. They want best-of-breed components with the assurance, of course, that those components are implementing the full range of SOA standards for heterogeneous interoperability. So, I’m taking issue with this notion of a "best-of-breed" suite. Anybody else have any thoughts on that?

Macehiter: I’ll give you a couple of perspectives on this. We have to recognize that organizations increasingly are looking to rationalize their supply strategy. So, they’re increasingly looking to deal with a smaller number of vendors and suppliers, which is, in part, driving the move toward larger vendors attempting to offer a suite or portfolio of product capabilities that can help organizations manage the lifecycle of an SOA initiative.

That’s one factor that’s driving it. The second issue is the use of the term "suite," and what that really entails, versus what the market is currently delivering. Companies are putting together a bunch of products under a common brand, whether it’s Oracle Fusion, SAP NetWeaver, or under the IBM WebSphere brand. That's one thing. Actually making sure the products are well integrated and that they have a common management environment, common configuration environment, and common policy definition environment is the second thing. That’s one element of it.

The second issue is what actually constitutes a suite to support service-oriented initiatives. There is a tendency, certainly among the larger vendors, to focus on SOA from a development and integration proposition, rather than thinking more broadly about the capabilities you need to support service-oriented initiatives throughout the lifecycle. That extends beyond development and integration into things like security and identity, which have to be incorporated into an overall SOA offering.

Management and monitoring, usage management, audit logging are in the broad range of capabilities that you need. There’s a question as to whether it’s feasible for one vendor to offer all of those capabilities that you need to support an SOA initiative versus a set of core capabilities. Then the hooks in the interoperability allow you to exploit existing security and management infrastructure. There are a number of factors that we need to consider, and a lot of the SOA suite propositions are very much focused around development and integration, rather than management and monitoring, and really dealing with the lifecycle of services.

Gardner: I guess that explains and is consistent with the past. If you can have a cohesive approach to the development side, then the deployment tends to follow, and that’s where you monetize. Steve Garone, what do you think of this breakdown between best-of-breed and a suite?

Garone: All of us on this podcast today know that the debate over best-of-breed versus integrated-stack approach has been going for many years in a variety of scenarios and contexts, and it hasn’t stopped. I don’t really like the word "suite." It reeks more of marketing than functionality. I think what you really have to look at in terms of SOA is how people are actually approaching getting into building SOA-based environments.

What we’ve seen so far -- and we’ve talked about this on other podcasts -- is that up to this point people have tended to do pilot projects that are much lower in scale than what they will eventually do if they have success with the immediate projects. One tends to think that what they’re going to do at that point is pick and choose the individual products and functions that they need to make that happen in the short term.

I think that’s what we’re seeing, but I also sense that, despite the fact that everybody wants an open environment where they can pick and choose and not be tied to one vendor, what overrides all this is a desire to get things done quickly, efficiently. They want a way in which they don’t have to be concerned about integrating a lot of products and what that entails, and having potentially an unreliable environment. What that points to is working toward one vendor. End users will do that even in the short term by choosing someone that they know they can grow with in the future.

Gardner: Pragmatically, these vendors are also looking at their future and they’re saying, “We have an installed base. We have certain shops where we’re predominant. We want to be able to give them a clear path as to how to attain SOA values from their investment in our legacy. Therefore, we need to follow through with add-ons that smack of a integrated-stack approach.” So, it is almost incumbent on vendors to try to produce this "whole greater than the sum of the parts" -- if not to build out more SOA business, then just to hold on to their previous business.

Garone: That up brings up another interesting point, which is vendors, especially the platform vendors. The larger vendors, like IBM, Sun, and so on, tend to try to walk the line between being able to offer a fully integrated stack of software to accomplish whatever the goal it is -- in this case SOA implementations -- and also being what might be called “integratable.” This means you can bring in another product, because we adhere to standards, we’ll be able to help you do that.

They try to walk that line; where that really makes a difference is not so much what you are going to do in the future, but rather what you have done in the past. If you've got an existing registry that you used for identity management with your current applications, if you have existing app servers -- which is probably more common -- whomever you choose is going to have to be able to allow you to continue to work with those as part of a legacy environment. It sounds funny calling application servers legacy, but at this point you can do that, and that’s really where the "integratability" aspects of a fully integrated stack come into play.

Gardner: So how about you, Joe McKendrick? Do you see that the drive for simplicity and working from your installed base creates a compelling case for an integrated SOA approach? Or is the trade-off such that this is really not going to happen anymore? Is that the old way -- and is SOA fundamentally different, and therefore one should look for a different strategy?

McKendrick: Perhaps a little of both, Dana. Basically the industry still operates under the traditional mode where a lot of enterprises rely on one vendor -- we'll call it a master vendor -- that supplies most of its solutions. We see that in the IBM and in the Oracle markets. I agree with Jim that the notion of a SOA suite is very much an oxymoron. The idea of a SOA is to have "hot-swappable" software components that you could install and take out as needed in a loosely coupled architecture.

Dana, you hit upon the point that the vendors themselves have to demonstrate that they have some type of path to their installed base. They need some type of path to show that, "Yes, we are on top of the technology." In fact, if you speak with vendors out there about this strategy, even if the products or the path that they're offering are something customers aren’t adopting at the moment, it’s something they want to see with the vendor. If Oracle, hypothetically, wasn’t talking about SOA at all, there would be a lot of consternation, a lot of concern, among their installed base as to where the vendor is going.

Gardner: SAP would walk in, and their sales people would beat them up in these accounts, right?

McKendrick: Exactly. Now, Oracle is an interesting case. When I think of suites, I think Oracle demonstrates the best tendency in this area. In fact, they called their offering "The SOA Suite," and they include a number of components. I have spoken with some companies that have Oracle installations. Now, it should be noted that typically the customers for these suites are the installed base. The people who will be buying into the components of the Oracle SOA suite are companies that either have the Oracle applications, the E-Business suite or the Oracle database underneath. And, in most cases, they are buying into components of the suite.

I've heard a lot of positive things said about the BPEL Process Manager, for example. And, they are buying into pieces of the solutions, and as Steve pointed out -- it’s still in the pilot-project stage. We’re not seeing widespread enterprise implementations, but they are beginning to buy into pieces of these solutions such as the BPEL Process Manager.

Gardner: Hey, Tony Baer, how about you? Do you think that we are mature enough in SOA that we should be looking for homogeneity when it comes to tools and even deployment side? Or, is heterogeneity the issue that we are trying to manage?

Baer: As Steve was saying before, we can’t decompose it down to the age-old argument of best-of-breed versus integrated-stack. There is always going to be a tension between homogeneity and heterogeneity. For the customer, it’s going to be dictated obviously by what is already in place, basically as Joe pointed out. If 60 percent of my functionality, or even say 30 or 40 percent of my functionality, is SAP, I’m likely to listen when SAP tells me about a NetWeaver Solution.

On the other hand, if I’m in a sector that does not lend itself to package solutions, I will more than likely tend to take a best-of-breed approach -- especially if I do a lot of homegrown development, because my business is so unique. There will always be that creative tension there. That being said, the fact is that at the infrastructural level, there is a desire to have consistency. I don’t want to have five security engines. I don’t want to have three different authentications, if possible. Obviously, we’re never going to get that one, centralized identity repository in the sky, but I want to at least have my management framework be as consistent as possible and to manage what will inevitably be, in most large organizations, a federation of different installed bases of different technologies.

The other side of this is that for vendors -- and Oracle is probably the best poster child for this -- the reality in the enterprise software industry has been one of merger, acquisition, and consolidation. This means that vendors who started as organic developers now have four or five different product lines and each has had a separate lineage. The only way to put some rationality there is something like an Oracle Fusion SOA framework. Oracle has to develop this, if only out of the necessity to keep its own product offerings consistent.

Gardner: Now, back to Jim Kobielus’s point about this integrated approach being an oxymoron for SOA. Shouldn’t the vision of SOA allow us to have it both ways? If you have a culture and mindset in an organization, maybe it’s because of your legacy. Maybe it’s because of how you operate and the value you’ve perceived in past IT investments. Thus, you might want to remain with more of a single-vendor or an integrated-stack approach, but there might be other vendors without a legacy to drag along. The enterprise may want to take advantage of any innovation they can to be functionally heterogeneous and to explore and test open-source componentry as that becomes available. Shouldn’t SOA allow both of these approaches -- and pretty much equally?

Macehiter: In principle it should. We have to be careful to distinguish between the infrastructure that you require to enable SOA initiatives and what you’re trying to enable with that service-oriented initiative. Just because you want to have a loosely coupled component that you can combine in multiple ways to deliver business outcomes, doesn’t mean that the infrastructure that underpins that has to be similarly loosely coupled and based on the heterogeneous offerings from different vendors. So, there is a separation there.

We also we have to bear in mind the challenges around going for best-of-breed approach, which are well understood. It’s not so much whether the individual components can actually talk to one another but more about things like the management environment and how you manage the configuration and how do you deal with policy definition?

We’ve done some detailed assessments of service infrastructure offerings from SAP, BEA, IBM, Oracle, Sun, and webMethods. If you actually dig under the covers, you will see that each of the components has its own policy definition approach. So, the way you configure policy within the orchestration engine is inconsistent with the way you do it within the security and identity management capabilities, and that challenge occurs within suites. That’s going to be compounded as you look across different components. That introduces risk into the deployment. It reduces the visibility of the end-to-end deployment. It's those factors that are going to be important, as well as whether a communication and brokerage capability can integrate with the registry and repository. There are a number of factors that you have to bear in mind there.

Kobielus: I agree -- I think that the notion of a best-of-breed SOA suite makes more sense from an enterprise customer’s point of view. Most enterprises want to standardize on a single vendor and a single stack for the SOA plumbing -- the registries and repositories and also the development tools. They want the flexibility to plug in the different application layer components from Oracle and SAP and others, that are SOA-enabled and that can work with that single-core-plumbing-stack from a single vendor.

Gardner: Perhaps the tension here is between what aspects of SOA should be centralized, repeatable, simplified, and consolidated, and which ones should not. It’s not really a matter of SOA homogeneous or SOA heterogeneous. In moving toward SOA, should you say, "Listen, this is going to be common throughout. Let’s reuse this. Let’s manage our policy as centrally as possible.

"We might say the same for other federated and directory services. We might say the same for our tooling, so that we don’t have myriad tools and approaches from our developers. On the other hand, we want to have great flexibility and loosely coupled benefits, when it comes to which services, be they internal or external, be they traditional nature or more of a ‘software as a service’ nature that we can easily incorporate and then manage those as process."

So, is the dividing line here, Steve Garone, between what architecturally makes sense as centralized and not?

Garone: Actually I’ve just sort of been chomping on the bit here a little, because I’ve been listening to the conversation. This a really important point, mostly because there is a lot of stuff -- a lot of analyst opinion, a lot of blogging -- floating around that I’ve read, and I know you guys have probably read, on this very subject, the sort of philosophical dichotomy between what SOA is supposed to be and the notion of an SOA suite or a SOA integrated stack.

Frankly, from the end-user perspective, the message ought to be that the whole notion of SOA, as it relates to loose coupling, is really focused on the services and the applications that you’re going to deliver. That doesn't imply or even suggest that your infrastructure cannot be based on an integrated stack or software that’s designed to work well together. It allows you to work with a single vendor, and to be very efficient about how you both develop, deploy, and maintain and manage your environment.

Gardner: We also have to remember that this evolution of SOA is not happening in a vacuum. There are other major IT trends and business trends of worth. Many of them are focused on trying to reduce the cost of ongoing maintenance and support somewhere between 60 and 80 percent of total IT costs, and maybe more, to free up discretionary spending and to reduce the total spending for IT in many organizations. The trends often involved include data center consolidation, moving toward a more standardized approach for underlying hardware, embracing virtualization/grid/utility principles, and so on. Perhaps we have to recognize that even as SOA moves on its own sort of trajectory, organizations are going to be consolidating and looking for commonality of services, and improved support and maintenance types of features throughout their infrastructure.

Garone: Just to make one more small point. The one area that may diverge from the philosophy that we’ve been talking about is in the area of open source. I think that people who go out and try to implement SOA-based solutions on a variety of levels using open source technology may tend to take a more best-of-breed, individual-component approach than those who would run to their local IBM sales rep and say, “What do I do with SOA?” Even that’s going to change over time, and we’re starting to see SOA suites develop around open-source technology as well. So, that’s going to move in that direction as time goes on.

Gardner: That's another trend that is in tandem with SOA and needs to be woven together with it. It’s obviously a large undertaking. I‘m also reminded, after an interesting briefing I took this week with Informatica, and Ash Kulkarni. We had a really long, interesting discussion about the role of data, master data, and metadata when it comes to moving toward SOA. We really shouldn’t lose track of the fact that as you move to applications as services, and you go loosely coupled, and you adopt more reuse across development with common frameworks, and use rich internet application interfaces -- what about the data?

The data has to be managed as well. Increasingly, companies that have had mergers and acquisitions, or have just gotten myriad applications with varying views of something as specific as a customer identity -- there might be 10 or 15 different views of a customer, as defined by a variety of different applications. How do you manage that? And when you think about the progression of the data, it seems to me that if not in actuality, in a virtual sense, you want to become centralized with your data so that data can be used in a clean and impactful or productive way across all of your services.

Does anyone out there have some thoughts about what considerations to have when it comes to data in this decision about best-of-breed or integrated approach?

Macehiter: I was just going to say, the issue is that data has always been treated as a second-class citizen, and that it has been the product of applications which have then been subsequently analyzed. More organizations are recognizing this need to treat data as a peer, and deliver access to information, whether it’s structured or unstructured, as a service, which can be incorporated as needed into business process.

IBM was quick to identify this when they sold the information as a service strategy. And Oracle, surprisingly, given where they have come from, has actually not really enunciated data services, vision and platform. Although I did notice something on the Oracle Technology Network a couple of weeks ago, where they are just starting to talk about Oracle Data Integrator, based on an acquisition they made of a company called Sunopsis.

So, increasingly that's going to become part of the broader suite proposition. And, this is not just in the area of data but -- more broadly as customer adoption matures -- what constitutes an SOA suite. We’ve seen this around registry and repository, which historically was a best-of-breed proposition from the likes of Systinet and Infravio. Where are they now? They're part of a broader suite proposition from HP and webMethods, respectively. We’ll see this again.

Through acquisition what constitutes a suite will broaden as organizations become more mature in their approach to SOA. "Information as a service" is exactly one of those areas. Initially, that will probably be served by best-of-breed components, and then through a combination of acquisitions or very close partnership relationships will gradually be subsumed into what organizations believe is a SOA suite.

Gardner: Any other thoughts on the data services level and how that relates to this discussion?

Kobielus: I cover SOA for Current Analysis, primarily with reference to data management; and SOA in the data management realm is really consistent with master data management (MDM) as a discipline. Basically, master data management revolves around how you share, reuse, and enable maximum interoperability of your core master reference data, your single version-of-truth information, which is maintained in data warehouses and various operational data stores, and so forth.

Informatica is one of many vendors -- you mentioned Informatica earlier -- that has a strong MDM strategy. But there are are a lot of enterprise information integration (EII) vendors out there. EII revolves around really federated MDM, where you keep the data in its source repository, and then provide a virtualized access layer. This allows your business intelligence and other applications to access that data through a common object or model and a common set of access schemas -- wherever that data might reside -- but facilitated through a virtualized access layer. That’s very much EII as implemented by Business Objects, BEA, and many other vendors, and is very much the approach for federated MDM.

Gardner: Let me pause you there for a minute, Jim. If a virtualized centralization works for information, why wouldn’t it work for other aspects of SOA?

Kobielus: Oh, it does. Virtualization, of course, is one of the big themes in SOA.

Gardner: You can enjoy the benefits of a homogeneous approach, but, in fact, have great heterogeneity beneath the covers. Isn't that the whole idea of SOA -- to provide homogeneity in terms of productivity control management, and yet with flexibility and agility?

Kobielus: SOA, first and foremost, is a virtualization approach -- virtualization defined as an approach for abstracting the external call interface from the internal implementation of a resource, be it data or application functionality.

Gardner: So SOA is best-of-breed -- and it’s integrated. And you can pick and choose how to proceed, based perhaps on your legacy and your skill sets.

Macehiter: We just have to be clear to distinguish between the assets or resources that you’re virtualizing through SOA, which is typically going to be functional assets versus whether you need to virtualize the infrastructure and apply SOA to the underlying infrastructure. That’s the key distinguishing point. And that gets the point that was being raised earlier about virtualized access to information.

The infrastructure could be common, but the information assets that you’re accessing will be in heterogeneous repositories accessed in a number of different ways. This is exactly what IBM is doing with its offerings around information-as-a-service, and BEA as well. It's having the equivalent of application adapters by applying them to information assets and then exposing those through a service interface, so it’s virtualized and transparent: where the information is, how it’s stored and what format it’s in.

Kobielus: You mentioned Oracle’s acquisition of Sunopsis, which is interesting, because Sunopsis is an ETL vendor and the transform side of it is critically important. When you are extracting data from source repositories, you’re transforming it in various ways. Traditionally, Sunopsis’s tools have been used primarily to support transformation of data, which will then be loaded into centralized data warehouses.

But transformation functionality is important, whether you’re doing it in an ETL data warehousing environment -- in other words, the traditional bus for MDM -- or whether you’re doing the transformation in an EII environment. There, in fact, you are not ultimately loading the transform data into a central store, but rather simply transforming the data, keeping it in it’s original schema, but transforming it so it can be rationalized, harmonized, or aligned with a virtualized data access model provided by that EII environment.

Macehiter: Exactly. The transformation should occur behind the service interface, and this is why you need the idea of common information models and common schema models.

Gardner: Before we get down too much in the weeds on EII -- we can address that perhaps in a whole show in the future with a guest who is very much involved with that industry. Let’s move on to our second topic today, given the amount of time we have.

There are a burgeoning number of critical skill sets that need to be applied to SOA. We’ve talked about data, whether it’s cleansing, transforming, virtualizing and approaching some sort of a MDM capability. We have talked about development and process, BPEL. We talked about infrastructure. There is the management, the architectural overview, and what’s our philosophy.

It seems like we’re going to need a lot of very skilled people who are both generalists, as well as highly specific and technical. Because for SOA to work, a bunch of people who are highly specific -- but don’t share the same vision or have a general sense of the strategy -- probably won’t fare too well. This issue comes to us from Joe McKendrick. Joe, give us a little setup and overview of where you think things are headed in terms of the necessary skill sets companies are going to need in order to accomplish the promise of SOA.

McKendrick: Thanks, Dana. It’s interesting. Actually, the impetus for my thinking on this came from a report Ron Schmelzer posted and I reported on my blog this week.

Gardner: Ron being with ZapThink.

McKendrick: That’s correct. He is sounding the alarm bells that the folks that we need to drive SOA forward in the enterprise is this class of enterprise architects and enlightened architects, if you will. There are a lot of SOA projects everybody is interested in. Everybody’s kind of ginned up about SOA now, and we’ve been hearing about it. Enterprises really want to begin to either pilot or move SOA past the pilot stage, and 2007 should be a big year.

Ron Schmelzer feels there may not be enough architects who can take this high-level view and drive this process forward. Now, it’s interesting, but when I posted this on my blog, I got lot of feedback that perhaps architects are not the only ones who can really lead this effort. There are plenty of developers out there, high-level developers, who can also contribute to the process and interact with the business. The key behind this argument is that you need folks who know what’s going on technically, but can interact with the business. It can be a rare skill to have both.

Gardner: Yeah, this is going to be demanding. You can get Oracle-certified, you can get Microsoft-certified, IBM-certified. Where do you go to become SOA architect-certified?

McKendrick: Where do you go in terms of higher education institutes to get trained on architectural planning and network design? I’ve talked to lots of people who say, “Yeah, we look at the computer science graduates coming up, but how many of these people really, fully have had any training or courses whatsoever on broad architectural subjects like SOA?" Very few.

Kobielus: That’s true. Not to get reminiscent or anything, but 10 years ago, when we started seeing Java ramp up, we saw a lag there as well. A lot of organizations were really hungry for Java developers, and the universities came through with more focus on it, but later than probably most organizations wanted. What will happen here is that while this ramp-up goes on, we might see a lot of new business and new interest in service organizations that can provide the professional services required to get people through it.

Macehiter: Yeah, that’s true. That’s going to be an important -- absolutely an important source. Also, there’s some work under way. I don’t know whether any of you are familiar with the the International Association of Software Architects (IASA), which is really trying to foster a community that does try and share best practice around software architecture, including SOA.

You hit the nail on the head in terms of the key skills that are required around being able to interface with the business. One of the skills and attributes that you also need as a SOA architect is really this ability to balance supporting short-term business outcomes but keeping an eye on the longer-term objectives in terms of gaining high quality and maximizing IT value. That’s an equally difficult skill because too often architecture historically has been focused on quite discrete initiatives or infrastructure. I’m thinking about server architecture or network architecture rather than this broader perspective. There are skills occurring from such things as Oasis and what they are trying to do around things like SOA blueprints. It will be useful to get someone from Oasis in a future podcast to discuss this, because this is where the education is coming from.

Gardner: I think that if everyone goes about SOA methodically on his or her own track, and based on their own experience, and we are going to come up with a real mish-mash, then it’s going to be a problem. There needs to be some standardization around methodology.

Coincidentally, in April we’re expecting to see version 3 of the Information Technology Infrastructure Library (ITIL). This is focused on the lifecycle of services. It’s really more at the IT service-management level than pure technology, but it does offer blueprints and books and standardized approaches on how to setup an IT department and manage some of these organizational things. It strikes me that that might be another influence on bringing some kind of a cohesive approach to SOA, rather than be totally scatter-shot.

Macehiter: ITIL came out of the U.K. government. What was interesting about it is that it was driven very much from the experience of people who were grappling with these very challenges. That’s where it’s going to come from in SOA. It’s going to come from things like the IASA and others practitioners defining the best practice, rather than a more theoretical, academic approach to defining the ideal methodology.

Gardner: It's my understanding that the global systems integrators are very interested in this coming version of ITIL, and some of these other standardization-for-methodological-benefit approaches. As I’ve said before, SOA is the gift that keeps giving, if you’re a systems integrator in a professional services organization. It will be really interesting to see how successful they are at bringing a standardized set of approaches to the SOA architect role and whether that’s actually in their best interests over time.

McKendrick: And when it washes up on these shores, we’ll call it American ITIL.

Gardner: Actually the number of ITIL users is highest in the private sector and in North America, as I understand it, although it’s hard to see to what degree people actually use it. I think people use it in dribs and drabs and not in entirety.

McKendrick: It’s going to be interesting. There’s a lot of emphasis on compliance now, and data management is a big part of it as well. ITIL is really going to come into play, and should be coming into play, because processes are outsourced. Because processes are being managed by third-party firms, you need to have across-the-board standards to ensure that the data is being managed properly and in accordance with some type of universal standard. And, the regulators are going to want to see that as well.

Gardner: Well, I think we’ve come up with two separate shows we'll need to do -- one on enterprise information integration (EII) and dig in to that topic specifically; and then, perhaps, we should do an ITIL show, get someone who is familiar with some of the authoring there, and dig into its implications for SOA.

Well I think that wraps it up for today. We’ve covered quite a bit of ground in a short amount of time. I want to thank all of our guests. We’ve had Steve Garone, Joe McKendrick, Neil Macehiter, Tony Baer and Jim Kobielus. This is Dana Gardner, your host and moderator for this week’s BriefingsDirect SOA Insights Edition. Please come back and join us next week. Thank you.

If any of our listeners are interested in learning more about BriefingsDirect B2B informational podcasts or to become a sponsor of this or other B2B podcasts, please fill free to contact me, Dana Gardner at 603-528-2435.

Listen to the podcast here.

Transcript of Dana Gardner’s BriefingsDirect SOA Insights Edition, Vol. 10. Copyright Interarbor Solutions, LLC, 2005-2007. All rights reserved.

Saturday, February 17, 2007

Transcript of BriefingsDirect SOA Insights Edition Vol. 9 Podcast on TIBCO's SOA Tools News, ESBs as Platform, webMethods Fabric 7, and HP's BI Move

Edited transcript of weekly BriefingsDirect[TM] SOA Insights Edition, recorded Jan. 19, 2007.

Listen to the podcast here. If you'd like to learn more about BriefingsDirect B2B informational podcasts, or to become a sponsor of this or other B2B podcasts, contact Dana Gardner at 603-528-2435.

Dana Gardner: Hello, and welcome to the latest BriefingsDirect SOA Insights Edition, Volume 9. This is a weekly discussion and dissection of Services Oriented Architecture (SOA) related news and events with a panel of IT industry analysts. I’m your host and moderator, Dana Gardner, principal analyst at Interarbor Solutions, ZDNet blogger, and Redmond Developer magazine columnist.

This week, our panel of independent IT analysts includes show regular Steve Garone. Steve is an independent analyst, a former program vice president at IDC and the founder of the AlignIT Group. Welcome back, Steve.

Steve Garone: Hi, Dana. It's great to be here again.

Gardner: Also joining us is Joe McKendrick, an independent research consultant and columnist at Database Trends, as well as a blogger at ZDNet and ebizQ. Welcome back to the show, Joe.

Joe McKendrick: Hi, Dana.

Gardner: Next Neil Ward-Dutton, research director at Macehiter Ward-Dutton in the U.K., joins us once again. Hello, Neil.

Neil Ward-Dutton: Hi, Dana, good to be here.

Gardner: Jim Kobielus, principal analyst at Current Analysis, is also making a return visit. Thanks for coming along, Jim.

Jim Kobielus: Hi, everybody.

Gardner: Neil, you had mentioned some interest in discussing tools. We’ve discussed tools a little bit on the show, but not to any great depth. There have been some recent announcements that highlight some of the directions that SOA tools are taking, devoted toward integration, for the most part.

However, some of the tools are also looking more at the development stage of how to create services and then join up services, perhaps in some sort of event processing. Why don’t you tell us a little bit about some of the recent announcements that captured your attention vis-a-vis SOA tools?

Ward-Dutton: Thanks, Dana. This was really sparked by a discussion I had back in December -- and I think some of the other guys here had similar discussions -- with TIBCO Software around the announcement that they were doing for this thing called ActiveMatrix. The reason I thought it was worth discussing was that I was really kind of taken by surprise. It took me a while to really get my head around it, because what TIBCO is doing with ActiveMatrix is shifting beyond its traditional integration focus and providing a rear container for the development and deployment of services, which is subtly different and not what TIBCO has historically done.

It’s much more of a development infrastructure focus than an integration infrastructure focus. That took me by surprise and it took me a while to understand what was happening, because I was so used to expecting TIBCO to talk about integration. What I started thinking about was, "What is the value of something like ActiveMatrix?" Because at first glance, ActiveMatrix appears to be something with JBI, a Java Business Integration implementation, basically a kind of standards-based plug-and-play ESB on steroids. It's probably a crass way of putting it, but you kind of get the idea.

Let’s look at it from the point of view of a development theme. What is required to help those guys get into building high-quality networks of services? There are loads of tools around to help you take existing Java code, or whatever, right-click on it, and create SOAP and WSDL bindings, and so on. But, there are other issues of quality, consistency of interface definitions, and use of schemas -- more leading-edge thinking around using policies, for example. This would involve using policies at design time, and then having those enforced in the runtime infrastructure to do things like manage security automatically and help to manage performance, availability, and so on.

It seems to me that this is the angle they’re coming from, and I haven’t seen very much of that from a lot of the other players in the area. The people who are making most of the noise around SOA are still approaching it from the point of view: "You’ve got all this stuff already, all these assets, and what you’re really doing is service-enabling and then orchestrating those services." So, I just want to throw that out there. It would be really interesting to hear what everyone else thinks. Is what TIBCO is doing useful? Are they out ahead or are there lots of other people doing similar things?

Gardner: TIBCO’s heritage has been in middleware messaging, which then led them into integration, Enterprise Application Integration (EAI), and now they’ve moved more toward a service bus-SOA capability. Just to clarify, this tooling, is it taking advantage of the service bus as a place to instantiate services, production, and management? And is it the service bus that’s key to the fact that they’re now approaching tooling?

Ward-Dutton: That’s how I believe it, except it extends to service bus in two ways. One is into the tooling, if you think about what Microsoft is doing with Windows Communication Framework. From a developer perspective, they’re abstracting a lot of the glop they need to tie code into an ESB, and TIBCO is trying to do something similar to that.

It’s much more declarative. It’s all about annotations and policies you attach to things, rather than code you have to write. On the other side, what was really surprising to me was that, if I understand it right, [TIBCO] are unlike a lot of the other ESB players. They are trying to natively support .NET, so they actually have a .NET container that you can write .NET components in and hook them into the service bus natively. I haven’t really seen that from anywhere else, apart from Microsoft. Of course, they’re .NET only. I think there’s two ways in which they’re moving beyond the basic ESB proposition.

Gardner: So, the question is about ESB as a platform. Is it an integration platform that now has evolved into a development platform for services, a comprehensive place to manage and produce and, in a sense, direct complex service integration capabilities? Steve Garone, is the definition of ESB, now, much larger than it was?

Garone: I think it is. I agree with Neil. When I looked at this announcement, the first thing that popped into my mind was, "This is JBI." When Sun Microsystems talked about JBI back in 2005, this is what they were envisioning, or was part of what they were envisioning. Basically, as a platform, that raises the level of abstraction to where current ESB thinking was already. At the time was confusing users -- and still is -- because they didn’t quite understand how, or why, or when they should use an ESB?

In my opinion, this raises that level of abstraction to eliminate a lot of the work developers have to do in terms of coding to a specific ESB or to a specific integration standard, and lets them focus on developing the code they need to make their applications work. But, I would pull back a little bit from the notion that this is purely, or at a very high percentage, a developer play. To me, this is a logical extension of what companies like TIBCO have done in the past in terms of integration and messaging. However, it does have advantages for developers who need to develop applications that use those capabilities by abstracting out some of the work that they need to do for that integration.

Gardner: How about you, Joe? Do you see this as a natural evolution of ESB? It makes sense for architects and developers and even business analysts to start devoting logic of process to the ESB and let the plumbing take care of itself, vis-à-vis standards and module connectors.

McKendrick: In terms of ESBs, there’s actually quite a raging debate out there about the definition of an ESB, first of all, and what the purpose of an ESB should be. For example, I quote Ann Thomas Manes . . .

Gardner: From Burton Group, right?

McKendrick: Right. She doesn’t see ESB as a solution that a company should ultimately depend on or focus on as mediation. She does seem to lean toward the notion of an ESB on the development side as a platform-versus-mediation system. I've also been watching the work of Todd Biske, he is over at MomentumSI. Todd also questions whether ESBs can take on such multiple roles in the enterprise as an application platform versus a mediation platform. He questions whether you can divide it up that way and sell it to very two distinct markets and groups of professionals within the enterprise.

Gardner: How about you, Jim Kobielus? Do you see the role of ESB getting too watered down? Or, do you see this notion of directing logic to the ESB as a way of managing complexity amid many other parts and services, regardless of their origins, as the proper new direction and definition of ESB?

Kobielus: First of all, this term came into use a few years back, popularized by Gartner and, of course, by Progress Software as a grand unification acronym for a lot of legacy and new and emerging integration approaches. I step back and look at ESB as simply referring to a level backplane that virtualizes the various platform dependencies. It provides an extremely flexible integration fabric that can support any number of integration messaging patterns, and so forth.

That said, looking at what TIBCO has actually done with ActiveMatrix Service Grid, it's very much to the virtualization side of what an ESB is all about, in the sense that you can take any integration logic that you want, develop it to any language, for any container, and then run it in this virtualized service grid.

One of the great things about the ActiveMatrix service grid is that TIBCO is saying you don’t necessarily have to write it in a particular language like Java or C++, but rather you can compose it to the JBI and Service Component Architecture (SCA) specifications. Then, through the magic of ActiveMatrix service grid, it can get compiled down to the various implementation languages. It can then get automatically deployed out to be executed in a very flexible end-to-end ESB fabric provided by TIBCO. That’s an exciting vision. I haven’t seen it demonstrated, but from what they’ve explained, it’s something that sounds like it’s exactly what enterprises are looking for.

It’s a virtualized development environment. It’s a virtualized integration environment. And, really, it’s a virtualized policy management environment for end-to-end ESB lifecycle governance. So, yeah, it is very much an approach for overcoming and taming the server complexity of an SOA in this level backplane. It sounds like it’s the way to go. Essentially, it sounds very similar to what Sonic Software has been doing for some time. But TIBCO is notable, because they’re playing according to open standards that they have helped to catalyze -- especially the SCA specifications.

Gardner: Now, TIBCO isn’t alone in some releases since the first of the year. We recently had webMethods with its Fabric 7.0. Has anyone on the call taken a briefing with webMethods and can you explain what this is and how it relates to this trend on ESB?

Kobielus: I've taken the briefing on Fabric 7.0, and it’s really like TIBCO with ActiveMatrix in many ways. It's a strong development story there and it’s a strong virtualization story. In the case of webMethods Fabric 7.0, you can develop complex-end-to-end integration process logic in a high-level abstraction. In their case, they’re implementing the Business Process Modeling Notation (BPMN) specification. Then, you can, within their tooling, take that BPMN definition, compile it down to implementation languages like BPEL that can then get executed by the process containers or process logic containers within the Fabric 7.0 environment.

It’s a very virtualized ESB/SOA development environment with a strong BPMN angle to it and a very strong metadata infrastructure. WebMethods recently acquired Infravio, and so webMethods is very deep now both on the UDDI registry side and providing the plumbing for a federated metadata infrastructure that’s necessary for truly platform agnostic ESB and SOA applications.

Gardner: And, I believe BEA has come out through its Liquid campaign with the components that amount to a lot of this as well. I'm not sure there are standards in interoperability, based on TIBCO's announcement, but clearly I think they have the same vision. In the past several weeks, we’ve discussed how complexity has been thrown at complexity in SOA, and that’s been one of the complaints, one of the negative aspects.

It seems to me that this move might actually help reduce some of that by, as you point out, virtualizing to the level where an analyst, an architect, a business process-focused individual or team can focus in on this level of process to an ESB, not down to application servers or Java and C++, and take advantage of this abstraction.

Before we move on to our next topic, I want to go back to the panel. Steve Garone, do you see this as a possible way of reducing the complexity being thrown at complexity issue?

Garone: Yes, I do. A lot of it's going to depend on how well this particular offering -- if you're talking about TIBCO or webMethods, but I think we were sort of focusing mostly on TIBCO this morning.

Gardner: I think I’d like to extend to the larger trend. Elements that IBM is doing relates to this. Many of the players are trying to work toward this notion of abstracting up, perhaps using ESB as a platform to do so. Let's leave it on more general level.

Garone: That’s fine a good point. You’re right. IBM is doing some work in this area, and logically so, although they come at this even though they have a lot of integration products. I consider them a platform vendor, which means their viewpoint is a little more about the software stack than a specific integration paradigm.

I think the hurdle that we’ll need to get over here in terms of users taking a serious look at this is the confusion over what an ESB actually is and what it should be used for by customers. The vendors who talk to their customers about this are going to have to get over a perception hurdle that this is somewhat different. It makes things a lot easier and resolves a lot of those confusion points around ESBs. Therefore, it's something they should look at seriously, but in terms of the functionality and the technology behind it, it's the logical way to go.

Gardner: Joe McKendrick, how about you in this notion of simplicity being thrown at complexity? Are we going to retain that? Is this the right direction?

McKendrick: Ah, ha. Well, I actually have fairly close ties with SHARE, the mainframe user group, and put out a weekly newsletter for them. The interesting point about SOA in general is that TIBCO, webMethods and everybody are moving to SOA. They have no choice. They have to begin to subscribe to the standards they agree upon. What else would they do?

When we talk about what was traditionally known as the Enterprise Application Integration (EAI) market, it’s been associated with large-scale, expensive integration projects. What I have seen in the mainframe market is that there is interest in SOA, and there is a lot of experimentation and pilot projects. There are some very clear benefits, but there is also a line of thinking that says, "The application we have running on the mainframe, our CICS application transaction system, works fine. Why do we need to SOA-enable this platform? Why do we need to throw in another layer, an abstraction of service layer, over something that works fine, as-is?"

It may seem archaic or legacy. You may even have green-screen terminals, but it runs. It’s got mainframe power behind it. It’s usually a two-tier type of application. The question organizations have to ask themselves is, Do we really need to add another layer to an operation that runs fine as-is?

Gardner: If they only have isolated operations, and they don’t need to move beyond them, I suppose it's pretty clear for them from cost-benefit analysis to stay with what works. However, it seems that more companies, particularly as they merge and become engaged in partnerships, or as they ally with other organizations and go global, want to bring in more of their assets into a business process-focused benefit. So, that's the larger evolution of where we’re going. It's not islands of individual applications churning away, doing their thing, but associating those islands for a higher productivity benefit.

Kobielus: The notion of what organizations have to examine is right on the money, but I think that’s more of a fundamental issue around SOA in general. I think the question you asked was how does something like this affect the ease with which one can do that, and will it figure into the cost-benefit analysis that an organization does to see if in fact that's the right way to go.

Gardner: Neil, this was your topic. How do you see it? Does this larger notion strike you as moving in a direction of starting to solve this issue of complexity being thrown a complexity? That is to say, there’s not enough clear advantage and reduced risk as an organization for me to embrace SOA. Do you think what you’re seeing now from such organizations as TIBCO and webMethods is ameliorating that concern?

Ward-Dutton: Yes and no. And I think most of my answers on these podcasts end up like that, which is quite a shame. The "no" part of my answer is really the cynical part, which is that, at the end of the day, too much simplicity is bad for business. It’s not really in any vendor’s interest to make things too easy. If you make things too easy, no one’s going to buy any more stuff. And the easiest thing to do, of course, for the company is to say, "You know what? Let’s just put everything on one platform. We’ll throw out everything we’ve got, and rebuild everything from the ground up, using one operating system, one hardware manufacturer, one hardware architecture, and so on."

If the skills problem would go away overnight, that would be fantastic. Of course, it’s not about technology. It’s all of our responsibility to keep reminding everyone that, while this stuff can, in theory, make things simpler, you can’t just consider an end-state. You've got to consider the journey as well, and the complexity and the risk associated with the journey. That’s why so many organizations have difficulties, and that's why the whole world isn't painted Microsoft, IBM, Oracle, or webMethods. We’re in a messy, messy world because the journey is itself a risky thing to do.

So, I think that what's happening with IBM around SCA, and what TIBCO is doing around ActiveMatrix, and what webMethods is doing, have the capability for people with the right skills and the right organizational attributes. They have the ability to create this domain, where change can be made pretty rapidly and in a pretty manageable way. That's much more than just being about technology. It’s actually an organizational, cultural process, an IT process, in terms of how we go about doing things. It's those issues, as well as a matter of buying something from TIBCO. Everything’s bound up together.

Gardner: To pick up on your slightly cynical outlook on vendors who don’t want to make it too simple, they do seem to want to make things simpler from the tooling perspective, as long as that requires the need for their run time, their servers, their infrastructure, and so on.

TIBCO has also recently announced BusinessWorks 5.4, which is a bit more complex-turnkey-platform approach that a very simplified approach to tools might then engender an organization to move into. I guess I see your point, but I do think that the tooling and the simplification is a necessary step for people and process to be the focus and the priority, and that the technology needs to help to bring that about?

Ward-Dutton: You’re absolutely right, Dana, but I think the part of the point you made when you were asking your question a few minutes ago was around do we see less technical communities getting more heavily involved in development work. This is the kind of the mythical use of programming thing I remember from Oracle 4GL and Ingress 4GL. That was going to be user-programming, and, of course, that didn’t happen either. I do see the potential for a domain where it’s easier to change things and it’s more manageable, but I don’t see that suddenly enabling this big shift to business analysts doing the work -- just like we didn’t do with UML or 4GLs.

Gardner: We’re not yet at the silver-bullet level here.

Kobielus: Neil nailed it on the head here. Everybody thinks of simplicity in terms of, "Well, rather than write low-level code, people will draw high-level pictures of the actual business process, not that technical plumbing." And, voila! the infrastructure will make it happen, and will be beautiful and the business analysts will drive it.

Neil alluded to the fact that these high-level business processes, though they can be drawn and developed in BPMN, or using flow charting and all kinds of visual tools, are still ferociously complex. Business process logic is quite complex in it’s own right, and it doesn’t simply get written by the business analyst. Rather, it gets written by teams of business and IT analysts, working hand in hand, in an iterative, painful process to iron out the kinks and then to govern or control changes, over time, to various iterations of these business processes.

This isn’t getting any simpler. In fact, the whole SOA governance -- the development side of the governance process -- is just an ongoing committee exercise of the IT geeks and the business analyst geeks getting together regularly and fighting it out, defining and redefining these complex flow charts.

Gardner: One of the points here is around how the plumbing relates to the process, and so it’s time and experience that ultimately will determine how well this process is defined. As you say, it’s iterative. It’s incremental. No one’s just going to sit there, write up the requirements, and it’s going to happen. But it’s the ability to take iterations and experience in real time and get the technology to keep up with you as you make those improvements that's part of the “promise” of SOA.

McKendrick: The collaboration is messy. You’re dealing with a situation where you’ve got collaboration among primarily two major groups of people who have not really worked a lot together in the past and don’t work that well together now.
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Gardner: Well, that probably could be said about most activities from last 150,000 years. All right, moving onto our next topic: IBM came out with its financials this week, we’re talking about the week of January 15, 2007, and once again, they had a strong showing on their software growth. They had 14 percent growth in software revenues, compared to the year-ago period. This would be for the fourth quarter of 2006, and that's compared to the total income growth for the company of 11 percent -- services growing 6 percent, and hardware growing only 3 percent.

So, suddenly, software, which does include a lot at IBM, but certainly a large contribution form WebSphere and middleware and mainframes. Mainframes are still growing, but not great -- 5 percent. Wow. The poster child at IBM is software. Who'd have thunk it? Anybody have a reaction to that?

Ward-Dutton: Of course, one of the things that's been driving IBM software growth has been acquisitions. I know I’m a bit behind the curve on this one, but the FileNet acquisition was due to close in the fourth quarter. If that did happen, then that probably had quite a big impact. I don’t know. Does anyone else know?

Gardner: I guess we’d have to do a bit more fine-tuning to see what contribution the new acquisition’s made on a revenue basis, but the total income growth being a certain percentage and then the software, as a portion of that, I suppose, is the trend. Even so, if they’re buying their way into growth, software is becoming the differentiator in the growth opportunity for IT companies, not hardware, not necessarily even professional services.

That does point out that where companies are investing, where enterprises are investing, and where they're willing to pay for a high-margin and not fall into a commodization pattern, which we might see in hardware, is in software.

Kobielus: Keep in mind, though, in the fourth quarter of 2006, IBM had some major product enhancements. Those happened both in the third and the fourth quarter in the software space, and those were driving much of this revenue growth. In July, they released a DB2 Version 9, formerly code-named Viper, and clearly they were making a lot of sales of new licenses for DB2 V9. Then, in the beginning of the fourth quarter, they released their new Data Integration Suite. That's not so new, but rather enhancements to a variety of point integration tools that they’ve had for a long time, including a lot of these software products that they'd acquired with Ascential.

Gardner: That’s the ETL stuff, right?

Kobielus: Not only that, it's everything, Dana. It’s the ETL, the EII, the metadata, the data quality tools, and the data governance tools. It’s a lot of different things. Of course, they also acquired FileNet during that time. But also in the late third quarter IBM released at least a dozen linked solo-product upgrades. In the late third quarter, they were clearly behind much of the revenue growth, and in the fourth quarter for the software group. In other words, the third and fourth quarters of this past year had announcements that IBM had primed the pump for in terms of the customers’ expectations. And, clearly, there were a lot of pent-up orders in hand from customers who were screaming for those products.

Gardner: So you're saying that this might be a cyclical effect, that we shouldn't interpret the third and fourth quarter software growth as a long-term trend but perhaps as beneficial but nonetheless a "bump in the road" for IBM.

Kobielus: Oh, yeah. Just like Microsoft is finally having a bump, now that it’s got Vista and all those other new products coming downstream. These few quarters are going to be a major bump for Microsoft, just like the last two were a major bump for IBM.

Gardner: Let’s take that emphasis that you have pointed out, and I think is correct, on the issue of data -- the lifecycle of data, and how to free it and expose it to wider uses and productivity in enterprise. IBM has invested quite a bit in that. We just also heard an announcement this week from Hewlett-Packard that they are going to be moving more aggressively into business intelligence (BI) and data warehouse activities, not necessarily trying to sell databases to people, but to show them how to extract, and associate, and make more relevant data that they already have -- a metadata-focused set of announcements. Anyone have reaction to that?

Garone: I don’t know too much about this announcement, but from what I’ve read it seems as if this is largely a services play. HP sees this as a professional services opportunity to work with customers to build these kinds of solutions, and there's certainly demand for it across the board. I’m not so sure this is as much products as it is services.

Kobielus: HP, in the fourth quarter of 2006, acquired a services company in the data warehousing and BI arena called Knightsbridge, and Knightsbridge has been driving HP's foray into the data warehousing market. But, also HP sees that it’s a major hardware vendor, just as Teradata and IBM are, and wants to get into that space. If you look at the growth in data warehousing and BI, these are practically the Number 1 software niches right now.

For HP it’s not so much a software play. They are partnering with a lot of software vendors to provide the various piece parts, such as overall Master Data Management (MDM), data warehousing, and business intelligence product sets. But, very clearly, HP sees this as a services play first and foremost. If you look at IBM, 50 percent of their revenues are now from the global services group, and a lot of the projects they are working on are data warehousing, and master data management, and data integration. HP covets all that.

They want to get into that space, and there’s definitely a lot of room for major powerhouse players like them to get into it. Also, very interestingly, NCR has announced in the past week or so that it’s going to spin off Teradata, which has been operating more or less on an arms-length basis for some time. Teradata has been, without a doubt, the fastest growing product group within NCR for a long time. They're probably Number 1 or a close Number 2 in the data warehousing arena. This whole data warehousing space is so lucrative, and clearly HP has been coveting it for a while. They’ve got a very good competency center in the form of Knightsbridge.

They have got a good platform, this Neoview product that they are just beginning to discuss with the analyst community. I’m trying to get some time on their schedule, because they really haven't made a formal announcement of Neoview. It’s something that’s been trickling out. I’ve taken various informal briefings for the last six months, and they let me in on a few things that they are doing in that regard, but HP has not really formally declared what its product road map is for data warehousing. I expect that will be imminent, because, among other things, there is a trade show in February in Las Vegas, the Data Warehousing Institute, and I’m assuming that they -- just like Teradata and the others -- will have major announcements to share with all of us at that time.

Gardner: Well, thanks for that overview. Anyone else have anything to offer on the role of data warehousing?

McKendrick: Something I always found kind of fascinating is that the purpose and challenges of data warehousing are very much parallel to those of SOA. The goal of data warehousing is to abstract data from various sources or silos across the enterprise and bring it all into one place. And the goal of SOA is to take these siloed applications, abstract them and make them available across the enterprise to users in a single place. The ROI formula interestingly is the same as well.

When you start a data warehouse, you’re pumping in a lot of money. Data warehouses aren't cheap. You need to take a single data source, apply the data warehouse to that, and as that begins to generate some success, you can then expand the warehouse to a second data source, and so forth. It’s very much the same as SOA.

Kobielus: I agree wholeheartedly with that. Data warehouses are a platform for what’s called master data management. That's the term in the data-management arena that refers to a governance infrastructure to maintain control over the master reference data that you run your business on -- be it your customer data, your finance data, your product data, your supply chain data and so forth.

If you look at master data management, it’s very much SOA but in the data management arena. In other words, SOA is a paradigm about sharing and re-using critical corporate resources and governing all that. Well, what's the most critical corporate resource -- just about the most critical that everybody has? It's that gospel, that master reference data, that single version of the truth.

MDM needs data warehousing, and data warehousing very much depends on extremely scalable and reliable and robust platforms. That’s why you have these hardware vendors like HP, IBM, Teradata, and so forth, that are either major players already in data warehousing or realizing that they can take their scalable, parallel processing platforms, position them into this data warehousing and MDM market, and make great forays.

I don’t think HP, though, will become a major software player in its own right. It’s going to rely on third-party partners to provide much of the data integration fabric, much of the BI fabric, and much of the governance tooling that is needed for full blown MDM and data warehousing.

Gardner: Great. I'd like to thank our panel for another BriefingsDirect SOA Insights Edition, Volume 9. Steve Garone, Joe McKendrick, Neil Ward-Dutton, Jim Kobielus and myself, your moderator and host Dana Gardner. Thanks for joining, and come back next week.

If any of our listeners are interested in learning more about BriefingsDirect B2B informational podcasts or to become a sponsor of this or other B2B podcasts, please fill free to contact me, Dana Gardner at 603-528-2435.

Listen to the podcast here.

Transcript of Dana Gardner’s BriefingsDirect SOA Insights Edition, Vol. 9. Copyright Interarbor Solutions, LLC, 2005-2007. All rights reserved.

Sunday, January 28, 2007

Transcript of BriefingsDirect SOA Insights Edition Vol. 8 Podcast On SOA Through the Eyes of Investors

Edited transcript of weekly BriefingsDirect[TM] SOA Insights Edition, recorded Jan. 12, 2007.

Listen to the podcast here. If you'd like to learn more about BriefingsDirect B2B informational podcasts, or to become a sponsor of this or other B2B podcasts, contact Dana Gardner at 603-528-2435.

Dana Gardner: Hello, and welcome to the latest BriefingsDirect SOA Insights Edition, Volume 8, a weekly discussion and dissection of Services Oriented Architecture (SOA) related news and events, with a panel of industry and financial analysts and guests. I’m your host and moderator, Dana Gardner, principal analyst at Interarbor Solutions, ZDNet blogger, Redmond Developer magazine columnist.

Our panel this week consists of Steve Garone, a former IDC group vice president, founder of the AlignIT Group, and independent IT industry analyst. Welcome, Steve.

Steve Garone: Thanks, Dana, great to be back.

Gardner: Also Joe McKendrick, a research consultant, columnist at Database Trends, and blogger at ZDNet and ebizQ. Welcome back, Joe.

Joe McKendrick: Thanks, Dana, I’m glad to be back as well.

Gardner: Its also a return visit for Jim Kobielus, principal analyst at Current Analysis. Hi, Jim.

Jim Kobielus: How’s it going, Dana? Hi, everybody.

Gardner: Neil Ward-Dutton, also making a repeat appearance, is a research director at Macehiter Ward-Dutton in the U.K. Hello, Neil.

Neil Ward-Dutton: Hi there. Hi, everyone.

Gardner: Our guest this week is Trip Chowdhry, a managing director of equity research at Global Equities Research. Welcome, Trip.

Trip Chowdhry: Hi, everybody.

Gardner: Our topics this week are going to revolve around three meaty issues. The first is the business opportunity for vendors around SOA. How will Wall Street, the City of London, other markets, and investor organizations view SOA as a growth opportunity, and what sort of companies will benefit?

Our second topic is going to be around the rcent announcement at Macworld -- and we’re talking about the week of January 8, 2007 -- by Steve Jobs and Apple Inc. of the iPhone, and what this might mean for a mobile front-end: Is it just for consumers? Is there an enterprise aspect to iPhone? And what might be some implications for SOA and composite applications?

First, let’s dig into this notion of SOA as a business opportunity for vendors. Some of the things you need to ask as an enterprise buyer are: "Am I buying into a company that’s going to be around in five years? Am I getting locked into a technology or relationship? If so, will that vendor be able to devote the resources for R&D, for support?"

I’d like to know that my vendors and primary suppliers are healthy financially. Some news just today: SAP came out with some results from the fourth quarter that came in below their Wall Street guidance. So, a little bit of a shocker there.

Let’s go first to Trip, because you’re an equity analyst, how do you view this SAP announcement? Is it a blip or is there some other opportunity to look at the impact of SOA and how the business is changing for business applications vendors?

Chowdhry: Actually, if you think about companies like SAP who have very long implementation cycles, they have a lot of moving parts. It's a complex product, and the problem that SAP has -- and to some extent, most of the SOA vendors have -- is that they’re trying to solve complexity with complexity, and with that you can easily get a few early adopters.

When it comes to mass adoption -- or the second phase of product adoption that needs to occur to show growth -- then you really have to ease the product, ease the message. You have to tell what you do in one bullet point. So far, our research shows that NetWeaver and SAP, and some other vendors, have very complicated messages, which CIOs are now struggling to understand.

That is going to create some sort of a downward pressure near-term in SOA-based initiatives from a business and financial point of view. From a technology adoption point of view and a trials point of view, SOA is definitely a trend, but it seems like the messaging, the product, and everything else need to be simplified, so that people can know how one initiative can correlate and coexist with other initiatives they have going.

Gardner: That’s interesting, because a recurring theme of our discussions over the past several months has been the complexity and the lack of clarity and understanding in SOA messaging and the business value. It seems to be also impacting how investors and those who value vendors look at this as an opportunity. It's like they don’t quite get it.

Steve Garone, do you agree with that, and do you think that there are certain types of companies, vendors, maybe systems integrators, that might be able to benefit from this complexity and lack of clarity?

Garone: Yes, I do. Dana, let me go back to your statement regarding messaging. Yes, we have had a variety of conversations about that, and in particular this sort of chasm that exists between technology messaging and business messaging. This is an architecture and a technology that can provide benefits from the technical point of view, but also from the business point of view.

It’s not clear that either the end-users or the providers of technology are able to clearly articulate either of them or have them interoperate -- so to speak -- have them mesh into a coherent vision of what SOA actually is and what it can deliver. So, I think 2007 is going to be a very important year for sorting out all that within organizations, and therefore in the responses that vendors provide in terms of messages.

Trip, I really loved your statement, "solving complexity with complexity." I think that’s right on the money. Another way to put that is that despite the Nirvana that SOA allegedly can provide, it’s still fundamentally about integration, and integration is always a difficult and complex problem. So, vendors who can address that in a robust and user-friendly way, are going to have significant amount of success.

In terms of companies like SAP, they sort of come at this from the enterprise application side. They in fact are going to have to move toward a model where they can present their products as a series of loosely coupled services that adhere to standards, and can therefore be integrated with other applications and easily accessed and used. I think they’re moving in that direction. I’m not really prepared to say that being unable to do this, or the speed at which a company like SAP is doing this, is affecting their financial results, but I do think that that’s going to become pretty much the ante that these companies have to put up in order to actually continue to play the game.

Gardner: It’s interesting, I speak to some systems integrators, and I characterize SOA as the gift that keeps giving, and they chuckle and they nod their heads and kind of wink. If you’re are a services organization, professional services, then complexity, integration, and such long-term trends always tend to be positive.

Garone: Yes, I agree with that.

Gardner: They also say they think SAP and perhaps other business or package business applications providers, monolithic application providers, are going to be yielding to some pressure in the market. Of course, it's too soon to tell from one quarterly result. We are having a robust global growth. Gross domestic products (GDP) are in growth mode. Even if the United States is in two to three percent growth, many of the emerging markets are growing much more rapidly.

You would think that a global vendor like SAP would be also enjoying some growth. So, it’s too soon to tell if there is a longer-term trend here. Let’s go over to Jim Kobielus. Jim, do you think that complexity is bad for vendors, good for SIs, and can you think of any types of vendor that might be able to go to Wall Street and say, "We’re going to be worth twice as much in two years because of SOA?"

Kobielus: I’ve joked for many years with people that the more change you have, the more complexity you have, and the more need you have for consultants to come in and explain it all. So, there’s always going to be an opportunity for consultants and analysts to explain what things like SOA are and are not, and what their relevance is to the average business user.

In terms of whether complexity is bad for vendors or good for vendors, and so forth, let’s take a step back here. In terms of the business opportunities in SOA or that SOA creates, first of all remember that SOA is just an architectural abstraction. How do you shrink wrap and make sexy something that’s just a three letter acronym?

In terms of differentiating your value prop as a vendor in this market, one of the problem with SOA is that SOA essentially has an architectural approach, smashing and dissolving the ability for vendor lock-in, because everybody is implementing common standards with any-to-any interoperability. So, these SOA universes are getting so multi-vendor and heterogeneous, the complexity can be overwhelming.

In many ways, the number-one opportunity that SOA presents for vendors are for those vendors that can reduce the complexity by providing SOA suites of software and other components, and secondarily those vendors, those service providers, who can provide SOA and integration best practices to enterprise customers.

So, how do you shrink-wrap SOA? Well, these suites -- from the likes of SAP/NetWeaver, Oracle, IBM, Microsoft, etc. -- implement all the piece-parts of SOA, the portals, the app servers, the databases, and the UDDI registries. Next, the Accentures of the world provide the warm bodies and warm brains of professional services to crunch this complexity down into greater simplicity, and deliver end-to-end integrated solutions that leverage the largesse that an SOA universe provides.

Gardner: What about middleware? We’ve seen IBM in the last several quarters come out with its newest growth engine, its software division, and within the software division the growth is in middleware: WebSphere. So, suddenly we’ve got the largest vendor and perhaps the largest SI as well, but their growth is in middleware. Oracle has also come out with some results in the last couple of quarters that have shown some strength in their middleware offerings.

Is SOA perhaps a leader to a larger infrastructure opportunity on Wall Street? What do you think, Joe McKendrick?

McKendrick: Well, Dana, I think basically at this point the terms middleware and SOA are fairly synonymous. If you talk about middleware and offering middleware out to the marketplace, you’re talking about some type of standardized, componentized service-based offering. So, absolutely. Middleware and SOA is the direction in which companies are going.

In terms of the opportunities, there are essentially three levels or three types of offerings vendors can offer, and put out to the marketplace. On one level, you have the applications. Then, there are the services, the systems integration (SI) services. And, then there are the development tools used to build these applications or systems. Microsoft, of course, still reigns as king of development tools. It has plenty of competition.

What I find interesting is on the application level, and this is where SAP has a lot of work cut out for it. As we see more standardized, componentized middleware evolving into the marketplace, we’re seeing more of a commoditization of software taking place, just as we saw commoditization of hardware back in the '80s and '90s. This stuff is probably happening under the radar at the this point, but I wouldn’t be surprised if we saw a Dell-type of business model begin to evolve in the software space, where you’re not an original equipment manufacturer or you’re not actually producing the software, but you’re pulling together components that someone else makes and offering it to the marketplace.

Gardner: Joe has raised an interesting issue, which is the business model. Let me take it back to Trip Chowdhry. Wall Street tends to frown on companies that are in cycles that have peaks and troughs, sometimes two or three years cycles. They’re difficult to predict. Wall Street prefers a recurring-revenue model that can show consistent returns and growth.

It seems to me that a move from an enterprise license approach, which we’ve seen in these large vendors, to a services-support-maintenance type of model, which we might expect with SOA offerings, might in fact please Wall Street. Do you have a sense of whether a shift in business model is in the offing and what it means?

Chowdhry: This is very good stuff that you mentioned, because there are some companies that are trying to innovate SOA as more of a service. There is a startup company called Mule, that’s trying to have -- I won’t say integration as a service, but has some SOA flavors to it. It’s not exactly SOA, but when I speak to these CIOs, they don’t say "I want SOA." They say "I want to make two systems work together with the least effort." That is a change over the last year. If that’s the problem, then the solutions could be many.

That’s one thing that we’re seeing. Then, of course, the Apache Foundation has its own product called ServiceMix, which is given out free, and JBoss coming out with its own SOA. Then, we have these commercial companies including BEA Systems, webMethods, and TIBCO, which have commercial offerings that are still on a license model. If you look at the various kind of plays in the market, one is software-as-a-service SaaS).

You have open-source alternatives like ServiceMix and JBoss, and then you have commercial pairs. Investors hate it when there is uncertainty, and there is no clear winner. Right now, there is no clear winner who can say, "Here is SOA." As someone on this panel mentioned, there is no product called SOA. You have a product called "database," but SOA is still a concept. And Wall Street is having a tough time putting a valuation or momentum behind SOA. Wall Street is thinking that any company that is in a disastrous situation evolves to be in "SOA."

IONA is one of them. WebMethods is another. TIBCO is struggling with growth. IBM, at the end of the day, is a services company, and since they are services company, they can push their own software the way it is, even though it’s not the best. BEA is also in transition. They don’t know what will happen to middleware. Oracle is trying to create a vertical stack. SAP is going with the horizontal stack. Microsoft is thinking the world is Microsoft.

Now, from an investor point of view, they see confusion and uncertainty, and when that occurs, they stay on the sidelines.

Gardner: All right, let’s take it over to Neil Ward-Dutton. Neil, it sounds like we ought to invest in bonds until this whole SOA thing gets settled down. What’s your perspective?

Ward-Dutton: I’ve just been listening to everyone and frantically writing stuff down. It’s interesting what Trip just said about how SOA is still not a product, and I absolutely agree with what some of the other guys said. It will never be a product. I think it's interesting about the observations that were made around IBM and Oracle in their middleware results, the contribution of middleware to their business. I think putting SOA in front of that is like putting the cart before the horse.

I agree with Trip in that what’s not happening is people saying, "I want SOA." What’s happening is a desire for delivering multi-channel services, dealing in a more consistent way with compliance mandates, making supply chains more flexible to allow better syndication of products and services, BPO and the need to integrate services across and between organizations. Those are the things that are being done, and SOA is more and more just the flavor with which those things are being delivered.

So, the big theme that is not going away -- and someone else said this five or 10 minutes ago -- is integration. It’s easy to think integration was a fashion in the late 1990s with Enterprise Application Integration (EAI), which incidentally was something that only really got off the ground once the big SIs got involved. The integration specialist players didn’t really make a huge market by themselves. What made a huge market that became a multi-billion-dollar market was actually the systems integrators. And, it’s the same with SOA.

Pure-play technology vendors providing really innovative little bits and pieces aren’t going to make a mainstream market. It’s only the SIs who really make that happen, because they can take a complex proposition and can actually communicate that effectively to the right communities that need to play into this.

Gardner: It would appear that SIs might be in the role of kingmaker when it comes to SOA -- if they are leading in terms of business opportunity, taking advantage of the change. They’re also going to be saying, "Well, here’s the best-of-breed that we suggest you use." IBM might favor its own software, but I think they’ve taken some pains to be a little bit agnostic or ecumenical.

If the customer says, "We’re an Oracle shop, and we want to use Oracle," then IBM will help them use Oracle. As Trip pointed out, IBM finds itself in a pretty good position because it has both the software business and the systems integration business. HP could also be considered in a good position. They have hardware, they have software partners, and they have this strong systems integration and professional services capability.

So, the question is: Are the SIs in a very strong and advantageous position over the next several years?

Ward-Dutton: SOA is a change in mindset. The challenge is primarily a change in the way you think about delivering capabilities through IT. So, what does that mean? Well, who’s going to make the money? The people who can help you change the way you think, not the people who give you bits of technology.

If you look at how the technology is being delivered, a lot of the technology that gives you the on-ramp to SOA -- the Web services enablement pieces -- those are being delivered free or nearly free as part of upgrades. The vendors are baking those technologies into products in the hope of making sure customers renew. That technology is finding its way to the market and to customers without lots of new money being spent. It's part of the regular upgrade cycle of technology, and the way that’s being procured.

The really interesting stuff is around change management, organization, and culture. That's where the real SOA market value is coming from. It absolutely plays into what everyone else was saying a minute ago about more of a subscription model on the technology side, because it's that kind of model that actually aligns the value of the investment with the value you’ll receive with the customer.

Gardner: Are you saying that SOA as a vision or a concept -- as it works its way into how people design, develop and integrate and manage and run their IT departments -- will in fact lower the amount of money that the market projects onto these vendors? Is that to say that SOA is a disruptive influence in terms of the amount of money required to do IT?

Ward-Dutton: No, at all. SOA does not create a whole pot of money to dive into. What it’s doing, because it’s a flavor of technology that’s being baked into existing upgrade cycles, is to create a replacement market. SOA-related technologies are replacing others.

Gardner: Let’s go around the table. I want to ask a very simple basic question and that is: Does SOA create more demand and more net spending over a two- or three-year period, or does SOA, in fact, spur on and create less IT spending? This is very general and aggregate, but we’re trying to determine whether SOA subtracts from the amount of money -- the pie that’s spent on IT -- or not? First, let’s go to Steve. What do you think?

Garone: Wow, that’s quite a question, Dana. I’m not sure that I can give a precise answer today.

Gardner: Gut instinct?

Garone: We’ve all recognized during these conversations that SOA is really just starting out, people are just really starting out with SOA. If you look at all the case studies that are around, and I’ve talked to end users about this, they’re really just beginning to ramp up with pilot projects or even small production projects, but it really hasn’t permeated a lot of organizations. There’s going to be a fair amount of money invested in new products and technologies, in training people to understand these and use them, and, in cases where you can’t do that or don’t see it cost-effective to do that, to go outside to system integrators to get that done.

Gardner: Steve, I was hoping for a short answer here.

Garone: I’m sorry.

Gardner: Is SOA a growth impetus or is it an contraction impetus?

Garone: I think it’s a growth impetus, especially in the short-term.

Gardner: Okay, Joe McKendrick?

McKendrick: It depends on how the economy does over the next two to three years, if the economy goes downward, we go into a recession or some type of economic downturn, when IT budgets decline, SOA will be seen as a strategy to cut cost. Formerly, a systems integrator would come in and spend about a year working on tying two systems together in an enterprise. If the two systems are SOA standardized to some degree, that could be shaved to a matter of weeks.

Gardner: So you’re seeing SOA as a cost-saving and somewhat of a contractor in terms of total spent?

McKendrick: If the economy goes into a downward cycle.

Gardner: Let’s just say the economy is adjusted, we’re going to have an adjusted perspective in terms of what the macro economics are.

McKendrick: IT spending probably will remain constant, but it’s going to shatter the types of projects that are out there. The systems integrators are in a tough spot because these one-year engagements that they could charge tens of thousands, hundreds of thousands, of dollars for are probably going to be going by the wayside. You’re going to see a lot of smaller engagements, smaller projects.

Gardner: Jim Kobielus, what do you think?

Kobielus: SOA is primarily going to be a belt-tightening approach that will come in very handy when the economy turns down. I mean if you do SOA right, it’s the whole notion of "don’t reinvent the wheel." In fact, you share, reuse, and consolidate all your existing silos down into fewer silos that can be then repurposed into new applications fairly quickly though some open standards.

If you do SOA right, then the SOA-specific projects will result in a leaner, meaner IT organization. Conceivably, the budgets might remain the same, but the share of the money will go not so much into the SOA plumbing, as UDDI registries and so forth, but will go for value-added projects in terms of business process reengineering (BPR). This will be based on the project accelerator templates that more and more of these SOA software vendors are providing -- more of the high-level systems integration.

Gardner: So over time there might be a bump in spending in order to actualize and realize SOA advantages, but once they are realized, the total amount of money required for IT should go down. This means a smaller pie for the vendors, which means vendors will be fighting over a smaller total marketplace, and we can expect some of the bigger players to perhaps have an advantage there.

McKendrick: In any given IT project, the role of the IT analyst will shrink and the role of the business analyst will grow, because then the value-added will be in process optimization as driven by the business people.

Gardner: I dare say that productivity will increase, but again we’re looking at this through the lens of how to size the total market for SOA and how vendors will adjust to that. Neil Ward-Dutton, what do you think about this, is SOA a contracting influence over time or is it a growth influence?

Ward-Dutton: It’s neither. Things won’t change, and the reason has to do with the size of the pie. There’s a maturing view of IT as a business enabler out there, and so IT budgets are really going to pretty much track the overall business performance. The thing that is going to happen is, while the budget stays the same, SOA enables better choices to be made around where the money gets spent in IT. That’s what’s really important.

It’s about being able to draw a line between stuff you want to reduce cost on and stuff you want to go crazy on, because it’s where you really differentiate the business. SOA enables you to move that line, as and when you want. That’s really interesting. It puts the customer in the driver's seat. SOA is like table stakes for the vendors, SOA is not a net new market opportunity, it's table stakes.

Gardner: So, spending remains fairly neutral in real terms, but productivity as a result of that spending increases?

Ward-Dutton: Yes.

Gardner: Trip Chowdhry, you’ve done some studies, how do you see the total pie for enterprise software and infrastructure being affected by SOA?

Chowdhry: If you look at the big picture, the industry is going through consolidation. Companies are merging, and that definitely puts integration as a top priority. Even before the two companies merge, the second thing they look at is: Can the two ITs work together, can the two IT departments, can the two products and platforms, work together between the two companies that are merging?

Definitely, an SOA kind of an architecture makes the M&A activity more fluid, but the question is, Who will benefit? Would it be software product vendors or would it be system integrators and consultants? I think there will be in two phases. The first phase would be the system integrators and consultants will win, because I think when we speak to the CIOs, anybody who can help them understand the mess gets the money. In the long term, software vendors may make money relatively or literally more than the SIs, because they may automate and simplify many of these processes. But net-net I think SOA is good for IT sector as a whole.

Gardner: Why, exactly, is it good as a whole?

Chowdhry: Because the past infrastructure has been wasted on legacy technology. Now, business is being done across every geography. Even a small company has to interact with a producer in China, a call-center in the Philippines, a software developer in India. When you think about the companies that are evolving today, it requires strong agility.

If you don’t like your vendor in India, you should be able to fire it and immediately get another one -- say, in Ghana or South Africa -- up and running. What SOA provides for a business user is flexibility, agility and the ability to optimize your processes to get the resource where it is cheapest and sell it where it’s more profitable. From a business point of view, SOA is a dream come true. The only problem is that it's not mature enough for everybody to put their hands around. The biggest problem SOA has is people and vendors saying, "It’s a concept! It’s a concept!"

The day people say, "SOA is a product, and I have a SOA product," like a database, then overnight SOA can become a reality and it could show the same sense of maturity and adoption that databases or Microsoft Office have.

Gardner: Okay. So, for investors, they want to see a product that they can sink their teeth into and say, "This is SOA and this is how it’s going to be sold into the enterprise." That way I can estimate and value the monetary flow.

Chowdhry: Exactly. They want to have an SKU and hear the price. That’s their mentality. Concepts are very difficult, because there’s no end to concept. The pushback I'm getting is that the problem with SOA is that it’s a constant evolution of various standards. First, it was SOAP; then, REST, and then the whole community debate about which protocol is good and which is not. Whenever there is so much discussion going on, people step back and say, "Let them figure it out. Maybe I'll put money into it next year."

Gardner: My take on this is that ultimately SOA is a growth influence, because it’s been the history of IT that when you’re about to crest from investment into recovering productivity benefits phase, and the cost begins to go down, there’s yet another thing that you have to begin to invest in. So, it’s ongoing. We’re still in the early stages of IT. This is not going to be something that you’re just going to mature to and then pull the plug and say, "We’re all done." It’s a journey and the spending will ultimately continue to grow.

Let's go on to our next subject. This week we saw Steve Jobs get on stage and introduce a fairly innovative confluence of what we’ve seen in multiple devices and multiple services. He’s taken a mobile device footprint, put a flat screen on it, given it a GUI, with a touch screen, brought together communications, both in text and voice, together with a full-blown operating system -- in this case OS X -- that can connect through Wi-Fi and through its Cingular partnerships, the EDGE network.

I’ve been very encouraged by this. It does a lot of what I would like to do from a personal productivity perspective. The iPhone product isn’t due until June, and it seems as if the feature and function list is still not completely nailed down.

My thoughts go back to when the Apple Newton was first discussed -- we’re talking 10 or 12 years ago. There was some vision about doing away with the PC for many workers. Now, notebook computers weren’t nearly as ubiquitous back then, and they were heavy. They were kludgey. The batteries didn’t work so well. But this notion of having a small-footprint device that can pretty much do what you’d want a PC to do strikes me as something that’s still of interest to the enterprise.

We see a lot of vertical niche applications with this. For example, when a FedEx person shows up at your home with a package, they’re essentially carrying a mobile PC device, but it’s highly verticalized and very expensive. It strikes me as being a very significant development, if we could get a common-footprint approach, an industry standard approach to this. If we could bring that into the enterprise and realize some of these benefits around business process and around edge workers and knowledge workers and business analysts getting out of their cubicles, going to where the activity is happening. They could tap applications through a mobile full-function browser anywhere, anytime, at low expense.

Am I alone in this? Steve Garone, do you think that things like the iPhone, and the Sony Mylo -- although that’s been directed more at college students -- are going to be the end-points for SOA?

Garone: It’s an interesting question, and to me there are actually two questions there. One is whether this is a useful device for the enterprise. Based on what I’ve seen of the iPhone, personally I’d love to have one. It’s very cool. The indications that I get from people who are actually implementing solutions in the enterprise is that there are some questions around what email systems it can work with, how robust the email is, which of course is very important in an enterprise environment. I was a little bit turned off by the fact that this is a single carrier only, which I think is contrary to the whole notion of an open interconnected network, and SOA, in particular.

Gardner: Not to mention competition.

Garone: Right. We can all talk about the tendency of Apple to do things like that throughout its history. But conceptually these kinds of devices from the very beginning have been part of the SOA vision. The question is: Is this the right device, does it meet enterprise needs in terms of email, and in terms of application access?

Gardner: Couldn’t you do Webmail through the browser?

Garone: You could conceivably do Webmail through the browser, but we haven’t even seen this device yet so we don’t know.

Gardner: If it runs OS X, it probably will run the Mac Mail program which is a strong POP client.

Garone: I agree. One issue that could come up, though, is one of the visions that has been talked about in the context of mobile devices and handheld devices is being able to access and download parts of all applications and databases for local use. The question is whether this the kind of device that can do that in an open and robust way in terms of other platforms and other technologies?

Gardner: Now, you mentioned you’d like one of these personally. This is how the PC entered in the enterprise. People liked PCs and they brought them in. They weren’t sanctioned by IT. They called them toys and trinkets. Perhaps the same effect could happen with something like the iPhone. What do you think, Joe McKendrick. Is this an end point that will find its way into the enterprise?

McKendrick: It’s interesting. I suspect it remains to be seen how deeply consumers embrace iPhone or whatever they’ll be calling it a few months from now. It’ll be interesting to see if this is something that enterprises embrace, which I don’t think will happen, I think it’s going to be kind of a bottom-up percolation.

Employees will be bringing these things into work with them, just as the cell phones and smart phones and PalmPilots had their roots, and the PCs began back in the early 1980s -- not as a deliberate strategy of the enterprise to reach these devices. But if there’s enough of a critical-mass of employees who are using the devices -- the iPhones, in this case -- then enterprises will begin to take a second look and reach out. I don’t think enterprises are looking at it right now or will be looking at it when it’s introduced in a few months.

Gardner: Jim Kobielus, do you see this as taking a step toward that notion of a mobile device that’s closer to a PC but does voice and other things that the enterprise could make good use of?

Kobielus: Oh yeah, for sure. But I don’t see anything terribly revolutionary in the iPhone, other than the fact that it comes from the Steve Jobs godhead. There’s no doubt that Apple does great design, does a great marketing, and does a great zeitgeist. They made a splash with the Newton and look what happened there. What in the iPhone is not already being used in corporate environments in a major way? People are carrying their iPods into the office and using them to listen to podcasts, or using their cell phones. They’ve already got mobile messaging and mobile browsers in a variety of devices that they’re using.

Gardner: They use iPods as a mobile storage device, too.

Kobielus: It's a nice design. I don’t want to sound to flip and cynical about it, but it's one of those things where Apple does a very good job, just like Microsoft does, of getting the average person on the street aware of the fact that we are reaching some sort of a tipping point in terms of putting these things in the hands of the average individual and the average office worker. Quite frankly, I’d like to wait another six to 12 months to see if this gets any traction in the enterprise arena. It probably will, but I don’t think there is anything strongly differentiating this particular client device.

Gardner: What do you think, Neil? Is having a low-form factor, but highly functional browser, something that will blow this open, something that brings together the necessary ingredients for a whole greater than the sum of the parts?

Ward-Dutton: No. Something I always try to remember is that I am not typical, and it's something I need to burn into my forehead. I am not typical, and I’m afraid neither are you guys. You are atypical. Most people aren't anything like us and don’t have our interests, nor all the time that we have to think about this stuff.

That mistake was at the heart of an awful lot of the far-out rhetoric that you heard in the late '90s- and early 2000-time around the previous generation of PDAs and mobile computing and how it was going to revolutionize the way that all business processes were enacted. They’re not, because actually it’s a minority of people that need this functionality. Most people aren’t mobile workers.

Gardner: Is it just another hype-curve here?

Ward-Dutton: I’m afraid so. As a consumer and an individual who loves gadgets, I think it's incredibly lust-worthy. I read some of the reviews and they'd crawl over broken glass to get one. It’s not going to be cheap, but as an individual, I think it’s awesome. Someone just said, "I’ll wait six to nine months." I’ll wait six to nine years.

Gardner: Trip Chowdhry, what do you think? You’re in Silicon Valley. Is this something that’s going to have an impact on the enterprise?

Chowdhry: Actually, I did see the iPhone at Macworld and I was very impressed. It seems like the name may have to change to Apple Phone, because Cisco has sued them. I think there are definitely enterprise kinds of applications that could work very easily on it. That is based on the demo that I saw at Macworld. First of all, browsing is very good -- very, very good. I would say very, very impressive.

It's very easy to use. If somebody sends you an email attachment or PDF or Word file, you can see it like you'd see it on a computer. It's totally amazing. You can expand it and contract it. The visual things are very good. Instant messaging is another application, which -- at least in the financial sector -- people like to communicate with.

Someone on this panel mentioned that the feature-effects are not complete. I think down the road there will be two or three versions. One could be for teenagers, one could be for a business user edition or small business edition, and the third could be for entertainment. The IM feature, as well as email and attachments, which are very business-centric, could do very well.

IM was one of the things I feel could be a killer app. I wouldn’t believe that many of the enterprise applications, like Salesforce.com-kind of stuff or running some mobile enterprise ERP system, on this PDA would do justice to it. But you can effectively communicate with your colleagues without a lot of baggage, and have four hours of battery life and being able to carry a very small battery as a spare.

I think it’s a good form-factor that can fit in every pocket. The feature sets still needs to be sorted out, but it’s a development platform. So, third-party guys will also come out with their own platform. First step, it will be a good replacement for products like BlackBerry and others.

Gardner: I tend to look at this optimistically in regard to the enterprise. I think that for salespeople, the mobile warriors, for those who are in the field, or internally on a factory floor, for example, this pulls together a lot of what was necessary and doesn’t require the integration on the back end.

The IT people will say, "Listen, all the stuff we’ve got can be plugged into this, whether it’s through the browser, through POP, through other standards of instant messaging. We can have a VPN go to it, and have secure access through the browser to our applications."

I think what makes this an intriguing to the enterprise is that Jobs and company have done the integration for them, and they don’t have to go and take each and every application or function and force-feed it to a device. That's done through standards and it could be very interesting as an accelerator to replacing the laptop and even desktop computer for a lot of workers.

Chowdhry: We think more in terms of data, but the people who were standing next to me [at Macworld] were representing a biotechnology company. They said, “I'll use iPhone at work, just to make sure I can scan through my voicemails.” That’s a feature where you can preview your voicemails just like you preview your emails. They felt that was the killer application for the enterprise. They said, “We have 20 to 30 voice messages in the morning. We have to go from one to thirty without knowing which one is important.”

Gardner: As I have alluded to in some of my blogs, if we bring Voice over IP (VOIP) into this, and we can do telephony and get the convergence benefits of having CTI and other benefits from an all-IP environment -- a lot of what we used to think of as "unified messaging" becomes a reality. And, as you say, that’s a very important productivity benefit.

McKendrick: Dana, this is Joe. The real test for the iPhone will be if a year from now we can do this entire podcast all using iPhones.

Kobielus: The problem with iPhone is that the hoopla surrounding it has still got us fixated on this notion that we all need or want one gadget for everything. I think the way it's all shaking out is that each of us possesses a federation of gadgets of our own. I don’t think so much that iPhone is a replacement for your laptop or even for your desktop, but rather yet another device that will hook up with them in various ways, through Wi-Fi and Bluetooth, and so on.

Then, you can zip all kinds of contents back in forth. What interests me more than iPhone from this past week is Apple TV or iTV, whatever they’re calling it -- the IPTV appliance. That seems to me to be a more exciting development on the whole. In a year’s time, we simply can be doing this video podcast using Apple TV.

Gardner: I would just add to that. I think this is going to reduce the number of gadgets I’ve got to have. In a sense, my notebook computer becomes my server, and it serves my television as a node using something like Apple TV or TiVo or Slingbox or whatever it might be. My notebook computer becomes my server for my content, so that I can manage it up to the cloud or to the other devices. It could be the cell phone, an iPod, or an iPhone. It really increases the value and strength of what the notebook computer does. It gives me a mobility node and also a home entertainment node. And that’s, I think, the vision here.

Kobielus: Didn’t Apple release, or didn’t they discuss, a home server this week as well?

Gardner: No, that was Microsoft, at CES.

Kobielus: Microsoft, I get these guys mixed up.

Gardner: The notion of a server is necessary, but whether we actually want to go out and buy another $1,000 Microsoft device that’s going to require a systems administrator behind every potted plant in every living room is still an open question.

Kobielus: I think it’s inevitable. I think the whole notion of a SOHO server is coming to the fore, I think every household in the world is going to have its own SOHO server before long, to coordinate this federation of gadgets and channels.

Gardner: Will it be a discrete box or will it be a virtualized server, where part of it’s on the cloud and part of it is just availing the extra power, capacity and storage I’ve already got on my notebook computer?

Kobielus: It’s a so-called set-top box repurposed.

Garone: Now, Dana, this is Steve. I just want to ask a sort of a devil’s advocate question here. Given what you just said, how does that pertain to the enterprise?

Gardner: Well, it’s interesting because if more and more people do this and they're getting this great functionality, productivity, and I guess you could call it client-server approach for their home and their personal life, and then they walk into their enterprise and they’re left with this kludgey, uncoordinated, un-integrated stuff, they’re going to be thinking, "Wow, I’d be better off having my SOHO and be a contractor to this enterprise than I would be by being actually a member of the enterprise."

Garone: That’s probably true, but I think what I’m getting at here is you see this as a very powerful browser, and certainly you can’t argue with that. But in terms of doing real enterprise work on this device, is this the right device for that at this point in time? I’m not getting the sense that it is -- maybe some day.

Gardner: I think it’s a combination of a notebook computer and something like the iPhone, because all the enterprise has to do is put things into an IP stream and put it onto a VPN, and that way I can access it through my notebook if I want full feature, or my iPhone type of a device if I want mobility. Plus that same device can then be something I use in my home for entertainment and managing my personal life as well.

So, for me this frees up the enterprise. I, as a user, have to worry about the node, the end-device. And they, the enterprise IT department, simply need to worry about putting their applications or their services or their SOA services into a stream through IP through a VPN.

Garone: That paints the picture of this device being an extremely thin client that communicates with and leverages assets that are on a server.

Gardner: It’s a rich convergence client, which is really what people have been looking for.

Chowdhry: I had a comment regarding the iTV, I saw it. Actually, I came back little less optimistic about it, because it uses Wi-Fi, and there are serious problems with Wi-Fi if you want to deliver high definition TV. Wi-Fi has a lot of problems with collision and jitteriness. They were showing some high definition videos on iTV and you could see jitteriness. For the way it’s being positioned, delivering high definition TVs within your home, at maximum you could only do it as one channel.

I am little less optimistic about that, because the right technology for something like that is probably a power-line technology. There’s a company, I think its called DS2, which has these 200 megabits-per-second chips that you could just broadcast right over your existing home networks. Some company -- I think its LG Electronics or Samsung -- are trying to use broadband 200 megabits power per second right into the electrical outlet. With that, you can deliver four to five high-definition streams.

Probably the first generation of iTV could just have mere success. It will take at least two or three years before iTV also incorporates some of these power-line technologies to get at least consistent broadband within the home.

Gardner: That’s a good point. The iPhone, iTV and even the AirPort (the Apple Wi-Fi device) are limited right now. But the fact that they are putting so much emphasis into it tells me that there are might be further generations of these wireless network capabilities out there that they’re banking on. It’s the paradigm that they like. Whether the current level of standards and capabilities meets the task of the future remains to be seen.

Okay, folks, we’re about out of time. I want to thank our guests: Steve Garone, Joe McKendrick, Jim Kobielus, Neil Ward-Dutton and Trip Chowdhry. Thanks all for joining.

I’m Dana Gardner, principal analyst at Interarbor Solutions. You’ve been listening to BriefingsDirect, SOA Insights Edition. Come back and listen again next week.

If any of our listeners are interested in learning more about BriefingsDirect B2B informational podcasts or to become a sponsor of this or other B2B podcasts, please fill free to contact me, Dana Gardner at 603-528-2435.

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Transcript of Dana Gardner’s BriefingsDirect SOA Insights Edition, Vol. 8. Copyright Interarbor Solutions, LLC, 2005-2007. All rights reserved.