SaaS Start-Up Workday Acquires Cape Clear - InformationWeek

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SaaS Start-Up Workday Acquires Cape Clear

Cape Clear Software was one of the last remaining independent providers of an enterprise service bus, which is middleware technology for integrating applications using Web services.

Software-as-a-service startup Workday on Wednesday acquired Cape Clear Software, one of the last remaining independent providers of an enterprise service bus, which is middleware technology for integrating applications using Web services.

The notion of middleware as a standalone offering is disappearing, and successful application vendors will have their own middleware, said Workday President Aneel Bhusri in a conference call. "The coming together of middleware and app companies is more the norm," Bhusri said, pointing to Oracle's planned $8.5 billion acquisition of BEA Systems and SAP's huge investment in its own NetWeaver middleware. "This is just the way the market is headed in the future," he said.

The deal calls for Cape Clear's ESB to disappear as an independently sold product, although Workday says it will continue to support existing customers. What Workday, a Cape Clear customer since 2006, really wanted was the developers who have helped it create its newly launched Integration On Demand service. The service calls for Workday's tech staff to integrate customers' existing applications or their partner applications, such as payroll services, with Workday's on-demand human resource and financial applications using the Cape Clear technology, and host the integrated apps from Workday's data center.

Workday says it will handle all maintenance of the integration, and update integration links between apps every time it updates its on-demand apps. The acquired Cape Clear developers are charged with continuing to advance the technology. It's a critical technology and talent acquisition for Workday, since IT managers often cite concerns about integrating their legacy apps with on-demand apps as the biggest barrier to SaaS adoption.

Workday, which didn't disclose Cape Clear's purchase price, has more than 35 companies as customers, mostly large ones that serve up its on-demand human resources software to thousands of employees, Bhusri said. Workday released its first on-demand financial applications late last year, and Bhusri said the company plans to announce a few big-name wins for those apps this year.

As part of the acquisition, Dublin-based Cape Clear becomes Workday's Integration On Demand business unit, managed by former Cape Clear CEO Annrai O'Toole. Bhusri said the center's location provides Workday with a good entrance into Europe. The company will initially focus on growing business in the Great Britain region, he said, and outside of Europe is pursuing business in Australia and China.

This story was amended Feb. 7 to reflect status of the ESB market.

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