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10/18/2005
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IBM Acquires SOA Vendor

DataPower, a maker of appliances used to streamline and speed up Web services applications, will become part of IBM's software group.

IBM on Tuesday said it has acquired DataPower, a maker of appliances used to provide security and faster processing of transactions between applications linked within a service-oriented architecture.

The move is expected to fill gaps in IBM's products, which focus on modeling, assembling, deploying and managing business processes automated through an SOA, which is an evolution in distributed computing that uses Web services standards to connect business applications.

DataPower will become a part of IBM's software group, which generates only about 15 percent of the company's top-line revenue, but a third of its overall profits. Jim Ricotta, chief executive of Cambridge, Mass.-based, DataPower, is expected to continue managing the company and take on additional responsibility within IBM's WebSphere software division. DataPower employees are expected to become IBM employees. Financial terms of the acquisition were not disclosed.

DataPower's appliances include the X150 Integration Device, which is used to streamline SOA infrastructures; the XA35 XML Accelerator, for speeding up transaction processing, and the XS40 XML Security Gateway, which provides Web services security at the XML messaging level. DataPower's security features are expected to complement SOA security-management capabilities found in IBM's Tivoli software, officials with the Armonk, N.Y., company said.

Jason Bloomberg, analyst for market researcher ZapThink LLC, praised the acquisition, saying IBM is buying the "sales leader in the application-oriented networking space." In addition, DataPower already had a solid relationship with IBM's WebSphere, Global Services and hardware groups.

"DataPower's product suite of integration, security, and performance appliances will fill various holes within IBM's broad SOA offering," Bloomberg said.

In addition, the purchase reflects the importance of hardware and network appliances in building an SOA, ZapThink analyst Ronald Schmelzer

"With IBM's entry into the network appliance space for SOA, we think this will turn up the heat on the other platform vendors such as BEA (Systems Inc.) and Oracle (Corp.) to consider how they too will broaden their coverage of SOA beyond simply software and professional services," Schmelzer said.

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