Java Innovators

There are hundreds of Java solutions. Here's how to find the best.

By Clinton Wilder and Rich Levin

he booming Java marketplace is delivering on the promise of business and technology innovation. Java startup fever is rampant as entrepreneurs follow the promise of big money. The $100 million Java Fund, introduced last year by venture capital leader Kleiner Perkins Caufield & Byers in Menlo Park, Calif., has reviewed business plans from 475 Java startups seeking venture funding. Large, established software vendors such as IBM and Oracle are also rushing to meet the demand for Java products.

As a result, IT departments have an abundance of technology options to choose from as they move into the world of online di stributed computing. But that abundance carries a challenge: how to choose an innovative Java supplier with staying power.

The explosion in Java vendors is more than just the latest Internet gold rush. The nature of Java technology-object-oriented, cross-platform, write-once, run-anywhere-lends itself perfectly to small development teams and small-capitalization companies. "Being able to scale your products across heterogeneous systems helps the little player who doesn't have the critical mass to do software porting," says Miko Matsumura, Java evangelist at Sun Microsystems' JavaSoft unit in Cupertino, Calif. "A lot of the development work in the past was just getting under the hood to localize a product for a given platform. That's not all gone with Java, but there's a lot less of it."

For corporate IT executives, the Java flurry is both a blessing and a curse. If you're doing any Java development, there's probably a company out there with an application, a development tool, or a design team that is exactly what you need. But how do you find them? How do you trust them? And above all, how do you forge a successful relationship with a young, unproven vendor working with what is still a relatively new technology?

"For people coming out of a fairly structured environment like Cobol, the Java world is a free-for-all," says Dennis Virkler, systems supervisor at Caterpillar Inc. in East Peoria, Ill. "It's pretty unnerving,"

Keeping your sanity as well as your job in the new world of Java takes due diligence, reasonable expectations, and a lot of common sense. The work boils down to picking a Java technology provider that will be around in five years, and finding the best way to work with that company to get great implementation, support, and payoff.

When selecting a Java innovator, you want a vendor with solid financial backing, whether from reputable venture capital firms or other sources, to ensure that it will be around for the long haul. But equally important in the Internet era of "coopetition " is partnership. All the big players-including Andersen Consulting, Hewlett-Packard, IBM, Microsoft, Netscape, Oracle, and Sun-rely on startups to provide important pieces of Java technology. Be very wary of any company whose technology hasn't been endorsed by at least one blue-chip partner.

Many IT executives will decide they really like the comfort factor of partnering with one of the established players. By going with a partner like Andersen or IBM, they let the primary contractor manage the relationship with the startups.

Background Check
The best way to tell if a startup understands your requirements is to talk to its customers. Just make sure that the vendor isn't serving so many other major companies and technology partners that it doesn't have time for you. "Partnerships can soak up 120% of the available bandwidth of a small company," warns JavaSoft's Matsumura. "Make sure you know what other commitments are in place." Just as scalability is a huge issue for the technology, a supp lier's ability to scale up to the needs of a growing customer base can mean the difference between your Java project being a success or a disaster.

An IT executive also needs proof that a vendor's management team understands critical market and business issues. The best bets are managers who started their companies after successful careers with larger vendors, or who have run successful startups selling to IT. "Because Java is so new and exciting, a lot of smart people are jumping in to start companies," says Ted Schlein, the Kleiner Perkins partner in charge of the venture firm's Java Fund. Two Java Fund companies' CEOs provide examples of each approach. Marimba Inc.'s Kim Polese is a first-time chief executive from the original Java development team at Sun. Wallop Software head Rob Bolt has run three successful companies.

But due diligence for an IT executive doesn't end with the selection of a vendor. You need to put safeguards in place to minimize your own risk should the vendor stumble. Two type s of safeguards are comprehensive testing and source code ownership.

In the Dallas-Fort Worth area, both Advanced Micro Devices Inc. and the Sabre Decision Technologies division of AMR Corp. are evaluating Voyager, a Java object request broker from ObjectSpace Inc. that releases remote Java agents to execute objects in distributed applications (see the profile on ObjectSpace ).

AMD's Dallas facility is considering Voyager for a next-generation manufacturing application. It will maintain and monitor semiconductor fabrication machinery on the factory floor, freeing the factory's human operators to focus on critical plant-management functions.

Testing 1, 2, 3
That's a big potential benefit-and a big risk if the technology fails. With new Java tools, AMD says the three most important rules are testing, testing, and testing. "If you work with it enough, and do some scalability and robustness testing, you'll quickly isolate inadequate, immature, or poorly supported technologies," says Ben Harry, computer-integrated manufacturing application development manager for wafer fabrication processes at AMD.

The best protection: Own the code. If you ask, many Java tool vendors will negotiate source-code licenses. They'll also provide complete and updated code on a regular basis. For those suppliers with a predilection for secrecy, corporate developers on the bleeding edge have a solution. "I always get an agreement with the vendor to put their source code in escrow, in case something unfortunate happens to the supplier," says John Nordstrom, a programmer/analyst who manages and evaluates Sabre's Internet development technologies. "I don't need the code as long as they're in business, but if they flop, I've got the key to the safe."

Negotiating source code rights also gives you a hedge against the incessant evolution of the Java language, standard libraries, virtual machines, middleware, and related technologies-an evolution that's not expected to slow anytime soon.

Java's technological pace of change actually favors going with smaller vendors, Nordstrom believes. "Smaller suppliers need to be looked at, because they can and must move faster than the big guys to meet market demands," he says. "Where does that put Microsoft or IBM? Can they move fast enough to keep up? They have a lot more to manage, and many constituencies to satisfy."

Case in point: Discover Brokerage's search earlier this year for a server based on Open Financial Exchange (OFX), a Java protocol for exchanging financial information on the Internet. The San Francisco financial services firm needed the technology for a personal finance application on its Web site that lets customers run financial analytics on data from a variety of sources, including mortgages, auto loans and credit cards.

John MacIlwaine, Discover Brokerage's chief technology officer, was able to locate OFX server technology only at Microsoft. But the product, code-named Marble, was still under development. "I told Sun that I nee ded an OFX server on Solaris, or I was buying NT," MacIlwaine says.

That lit a fire under Sun. The company quickly matched Discover Brokerage with Innovision Corp., a 10-employee startup and Sun partner in Lenexa, Kan. "I think they employ 10 of the 11 Java programmers in Kansas," MacIlwaine jokes, "but they beat Microsoft to market with an OFX server." Discover Brokerage announced its OFX application in June at the Securities Industry Association conference in New York ( IW, June 30, p. 26 ).

Small may be beautiful, but there's plenty of innovation at the big Java players, too. IBM, long lambasted for being slow on the draw, has jumped into the Java pool headfirst, developing Java Virtual Machines for all of its systems from the ES/9000 mainframe down to OS/2 (see the profile on IBM ). In late June, Ernst & Young launched the first major Java initiative by a Big Six consulting firm: All 6,000 of the firm's U.S. consultants will get Java traini ng.

"Staying power is always going to be an issue," adds JavaSoft's Matsumura. "Take the time to call the companies that your vendor refers you to. Look at fundamentals, and look at backing. Kleiner Perkins Java Fund companies are less likely to blow away in the wind than two guys hanging out in a garage."

Where The Money Is
The Java Fund, brainchild of Kleiner Perkins principal and Silicon Valley kingpin John Doerr, is the first fund in venture capital history devoted to a single technology. Investment partners in the $100 million wellspring include IBM, Compaq, Novell, Sun, and Southwestern Bell. The fund's 10 investments to date range from established startups -that's not an oxymoron in the Java world-like Marimba to tiny niche players like Pangea Systems Inc., creator of a Java platform for pharmaceutical companies developing new drugs.

The Java Fund is the best example of Kleiner Perkins' philosophy of keiretsu, the Japanese concept of a family of large and small companies that he lp each other toward common goals. "Our corporate partners have a common interest in making internetworking successful," says Kleiner Perkins partner Schlein. "I am not a Java zealot. You have to show me a problem that Java is solving. In reviewing business plans, the first question we always ask is `Why Java?'"

Java Fund partner companies get early looks at startups' technology and first crack at partnerships with them "but no guarantees," says Schlein.

Hyper Active
Some partnerships border on the incestuous. Java Fund company Active Software, a maker of Java-based systems integration software, began life as a development project within Sun (see the profile Active Software ). Active Software founders Jim Green and Rafael Bracho had worked for Sun on its Corba-related projects, but realized that Corba was not the best solution for integrating applications that aren't object-based-so they switched to Java.

Sun's management decided the project would work best a s a separate company. So Sun set up Green and Bracho with the Java Fund and let them take 10 of the best engineers they needed. Such close ties with Sun give Active Software a large measure of credibility in chasing corporate accounts.

To some large companies, Java and its fast-moving Java startups are just the jolt needed to kick-start their own somnolent development projects. "There's a lot more people available, there's a lot more tools available, and people are revved about getting on Java projects," says Jerry Shifrin, senior engineer at MCI's R&D center in Colorado Springs, Colo., which is working with Java object libraries developer KL Group in Toronto on a major application project. "And there's definitely a concern among our technology nerds that we're falling behind if we're not on, or at least near to, the very latest stuff." (See the profile on the KL Group .)

That's nothing new for the nerds. But in the past year, Java has become part of the lingo of thousands of IT and business executives who cannot afford to ignore it. In the San Francisco Bay area, JavaSoft is even running ads for 100% Pure Java on the San Francisco Giants' postgame radio show.

"We're finding that executive-level people insist on the use of Java," says JavaSoft's Matsumura. "The value proposition, the ability to move modules across disparate systems, is getting pretty evident."

Java technology isn't scary anymore. Now the challenge is finding the right vendor to make good on Java's value proposition within your company. If you're smart about it, Java is a risk worth taking.

-with additional reporting by Andy Patrizio