May 3, 2010
IBM today announced the acquisition of Cast Iron Systems, a privately held company that has specialized in the fast-growing arena of connecting on-premise data and systems to software-as-a-service (SaaS) offerings and cloud-based computing platforms.
IBM said the purchase of Cast Iron, the terms of which were not disclosed, will bolster the company's cloud-based data integration capabilities. It's an important emerging market where IBM faces increasing competition from Informatica and smaller players including NetIQ, Boomi, Hubspan, and open-source vendor Jitterbit. "Our model has always been a hybrid one, so Cast Iron is a nice fit," said IBM's Steve Mills, senior VP and group executive, IBM Software Group, talking about the continuum from outsourced services to hosting and cloud services during a Web conference from this week's IBM Impact conference in Las Vegas. "Cast Iron has grown its business over the last decade to be the premier provider of capabilities that enable a hybrid cloud environment." For years, Cast Iron focused exclusively on fast integration via appliances that could be installed on-premise or hosted by the vendor. In recent years the portfolio has broadened to include integration software and services apart from the appliances. Whatever delivery method customers choose, the promise is rapid deployment and implementation favoring configuration rather than coding. Prebuilt connectors for popular on-premise and cloud-based applications are complemented with data migration, cleansing and synchronization capabilities. Cast Iron's OmniConnect cloud integration platform, announced in early March, is designed specifically to integrate public- and private-cloud services with on-premise applications. Supported applications include the usual suspects among enterprise applications, including SAP, Oracle, PeopleSoft, Microsoft, Lawson and so on. Cloud platform partnerships include Amazon EC2 and Force.com, and SaaS partners include Salesforce.com, RightNow and NetSuite. In the short term, little is likely to change in terms of Cast Iron's technology, partnerships and support. Nonetheless, customers are likely to be wary of changes, according to Liz Herbert, a principal analyst covering SaaS for Forrester Research. "When these deals with big companies happen, customers tend to be most concerned about changes to the pricing model," Hebert said. "They're also worried about getting less attention. These customers were a top priority for Cast Iron. When they are assimilated into the larger IBM organization, that might change for some of them." On pricing, Cast Iron's services for flat-files and databases start at $500 per month. More complex integrations between SaaS services and on-premise applications cost approximately $1,500 per month. Integration involving six or more enterprise end-points, including SaaS and multiple on-premise applications, starts at around $4,500 per month. IBM executives today said they intend to continue to support the technologies, customers and partnerships that Cast Iron has in place. Cast Iron will be integrated into IBM's WebSphere business. The longer-term question is how Cast Iron will be integrated and find synergies with IBM's existing data integration technologies. It remains to be seen if the code bases, functionality and user experiences can be blended. IBM rival Informatica has an Informatica Cloud Platform based on the same technology it offers for on-premise data integration. Informatica declined to comment on today's IBM-Cast Iron news.
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