One of the few remaining standalone software tools vendors is Borland, which purchased rival TogetherSoft in October. Borland, in fact, would love being the only standalone tool developer left, partly because they feel they are unique and partly because they are confident they can compete.
"For Borland customers, the choice is clearer than ever: best-of-breed, stack independent, cross-platform, standards-compliant products with superior user experience and ROI versus an "all things IBM" alternative and all that this stands for," said a Borland spokesperson. "One example of how the "new" Rational will behave as part of IBM, is that Rational has officially decided not to continue to support a Borland/Rational bundle. Borland is the only company the customer can depend on to support all choices - IBM, Sun, Microsoft, Apple."
John Abbott, managing analyst of research firm The451 agreed with Borland's sentiments.
"I think Borland's position is interesting. It agreed to acquire TogetherSoft at the end of October, so it has the same basic idea as IBM - integrating higher-level modeling and analysis tools into its language-based IDEs. Borland now claims it's the only significant independent vendor of tools - as opposed to the systems vendors who, in Borland's words are "highly biased toward their own infrastructures. Until now, Rational has made a point of not competing in the IDE space, but instead has tried to embed its tools within other IDEs as seamlessly as possible. Now IBM will have the advantage over any of the others. It made a point of saying how it would be closely embedding the Rational tools with its WebSphere application server and other middleware."
Abbott continued: "Borland has its own application server, but can't compete with IBM and Rational on the breadth of middleware and software development life cycle management. What it might do is partner more closely with BEA in reaction. BEA, which also has a partnership with Rational, is likely to lose out if Rational is integrated more closely with WebSphere. It's already done some close integration work with TogetherSoft, so it's likely to start pushing that as an alternative for WebLogic app server users. That's good news for Borland."
Zapthink's Bloomberg has a different perspective: "I've seen other analysts predict that BEA will buy them. Well, that's possible, but I don't see that being in character for BEA -- their acquisitions have typically been to augment their core WebLogic platform, rather than to spread out their product line into new areas. And everybody would accuse them of copying IBM, where they want to be recognized as leading, while IBM does the following."
Bloomberg continued: "Instead, the folks at Borland are probably arguing over whether the Rational division of IBM will be a tougher competitor than an independent Rational -- and that argument could go either way. IBM shops will be happy about the acquisition, and thus will be harder for Borland to penetrate. However, non-IBM shops, whether they be smaller companies, Microsoft shops, or companies that have avoided IBM for some other reason, might be less likely to go with the new Rational than the old. The deciding factor will probably be what IBM decides to do with the product line."
As for the others, Bloomberg said there are many competitors who offer products that the BEAs and Oracles of the world can take advantage of if they don't want to work with IBM.
Abbott differs on this score. He thinks Oracle might see IBM's move as something of a threat and concurred that the buy could lead to a dicey situation between Microsoft and IBM: "Microsoft's likely to stick with Rational in the short term, because of the work it's done with Rational on .NET. But in the longer term the two are likely to drift apart if IBM pushes the Java/WebSphere combination."
BEA, who has seen its name added to the mix of potential Borland acquirers, refused comment on the topic, but Oracle was cool as a cucumber, if not a little snarky.
John Magee, vice president of Oracle 9i application server marketing, said he didn't think it was "rational for IBM to pay what it did for Rational [Software]." Acerbic wit aside, Magee said Oracle isn't breaking a sweat.
"At the big level, this is just more online consolidation in the software industry," Magee said. "It's tough to make a viable business out of tools standalone with Microsoft and IBM as the main players, so it was inevitable. From our perspective our Oracle 9i JDeveloper already includes functionality and modeling, so it's not a big impact on us. Oracle's strategy is to deliver these tools in an integrated solution. This deal means Rational adds 12 or so products to the 70 products IBM already has and it's up to users to pick which ones they want. We think this is a flawed approach."
Magee argued all the different code bases hurts productivity. JDeveloper, he said, integrates UML modeling, profiling, Web services, to make them all work together.
How will this play out if IBM succeeds in its acquisition bid? Giga Information Group said it believes the deal will challenge the ability for independent tool makers to remain viable because major systems vendors are embracing integrated software tool lifecycles. While the Borland's and Oracle's should be safe for now, Giga warns that if they don't move toward better product integration they will lose market share.