Enterprise application vendors are advancing on the integration turf occupied by platform players with the help of third-party adapter partners.
These partners are giving vendors such as SAP AG and IBM the tools to offer enterprise developers a stream of Web-services-based APIs.
It comes as enterprises seek to build services-oriented architectures to replace traditional monolithic applications. Moreover, application vendors such as SAP and PeopleSoft Inc. want to leverage the trend to undercut the value proposition of integration platforms such as IBM’s WebSphere.
Advancing SAP’s efforts, Information Builders-owned iWay is expected to announce SAP has selected its Adapter Factory to provide UCCnet integration for SAP’s integration platform, known as NetWeaver.
iWay is one of a growing set of companies such as Attunity and Taviz that sell APIs to platform and application vendors alike. iWay reports SAP customers will be able to exchange data with UCCnet, a neutral organization run by the Uniform Code Council that provides item registry and data synchronization for electronic commerce. The technology will negate the need for SAP to purchase APIs from competing application vendors such as PeopleSoft and Oracle.
More importantly, the deal strengthens SAP’s ambition to expand NetWeaver’s integration capabilities.
"(This deal) will help position SAP as an enterprise integration platform," said Jake Freivald, marketing director at iWay Software in New York. "With this they will be able to credibly claim that anything from outside SAP will work."
Critics argue NetWeaver has garnered little interest from enterprise customers as an application-integration platform, a charge SAP executives repeatedly refute.
"Customers have shown keen interest in NetWeaver," said Shai Agassi, SAP executive board member, at the company’s Sapphire show in Orlando, Florida, recently.
The same is true of more than 100 software development partners, Agassi argued. SAP is working with these partners to roll out its ESA (Enterprise Services Architecture) before the next release of NetWeaver, code-named Symphony, in 2004.
As a result, SAP has taken another step toward emulating the application integration of platforms such as IBM’s WebSphere and BEA System’s WebLogic.
"Everything (in the application) can be a service. The job now is not building monolithic applications but wiring services together," Freivald said. "We want developers to think of adapters as services."
Craig Conway, CEO of Pleasanton, Calif.-based PeopleSoft, used his CeBit keynote to fire a salvo at integration players.
"This is the beginning of the end of middleware. It’s the beginning of cross-functional applications, where the integration between them is not a burden on you, it’s a burden on the enterprise software companies," Conway said.
IBM reinforced its integration strategy this month when it rolled out about 300 adapters for its WebSphere platform, all developed by the company or partners.
Some observers argue this strategy is solid. "I think IBM has played it cool by creating an attractive platform (WebSphere) for independent software developers, while at the same time making sure they appear as partners and not competitors," said Dana Gardner, a senior analyst at The Yankee Group in Boston.
Others say IBM still has the option to extend WebSphere’s application-integration capabilities with its app vendor partners, further negating the need for packaged applications such as CRM, ERP, and financial.
"That (would) take away one of the legs even the larger application providers have to stand on," said Stephen O’Grady, a senior analyst at RedMonk in Hollis, N.H.
Oracle has positioned itself as both a platform and applications provider, alienating many ISVs in the process, Gardner said. Oracle is unlikely to choose one side of the platforms and applications fence. "With the PeopleSoft-J.D. Edwards-Oracle situation, it is going to be messy no matter what," Gardner said. "But a company in the applications space like SAP, could come out looking pretty good from this situation."
Meanwhile, IT executives dealing with server consolidation issues appear to be moving away from smaller EAI vendors.
"We are starting to deal with so many layers now in just trying to piece together the data stores we have, it is getting overly complex and expensive," said George Simpson, a database administrator at Maryland Power & Light in Gaithersburg, Md. "If I can deal with just the more established companies for both applications and tools, then all the better."
For large enterprise application vendors that have detailed their own integration platforms, including SAP, PeopleSoft, Oracle, and Siebel, the enterprise’s reliance on traditional platform integrators will continue to pose a challenge.
One leverage point these companies may seek to exploit will be a return to the ASP, or hosted model of application delivery.
While such services have made inroads among smaller customers, larger companies are now taking note of the cost and flexibility advantages, according to several analysts.
PeopleSoft, Siebel Systems, and SAP already offer fledgling hosting services, but the initiatives have had limited success. Denis Pombriant, an analyst at Boston-based Aberdeen Group, predicts either PeopleSoft or Siebel will make a big hosting announcement within the next six months.
IBM may be pursuing a similar strategy. Andrew Schroepfer, president of Plymouth, Minn.-based Tier 1 Research said IBM’s strategy to recruit ISVs to offer IBM-hosted versions of their applications could see it build a network to rival SAP.
IDG News Service correspondents Stacy Cowley and John Blau contributed to this article.