Thursday, March 19, 2009

What does an IBM acquisition of Sun mean for Identity Management?

IBM employees: hands up those of you expecting to tell management to stick their redundancy packages where "the Sun don't shine"?

Sun employees: hands up those of you who walked into a meeting this morning and came out to be greeted by people with spray cans and paint tins eager to paint you IBM-blue, itching to call you a smurf?

In case you've been in a cave today, the rumour ("rumor" for my American friends) doing the rounds is that IBM is in talks to acquire Sun. I should stress that is a rumour, but I suppose everyone thinks the fact that the Wall Street Journal is one of the news outlets reporting on this rumour gives it some additional weight.

I wasn't going to bother writing anything given that nothing has actually happened and I'm not sure how this is a no-brainer move for IBM, but a few people have emailed asking what I think. So the easiest way to respond was to post this.

There's no shortage of coverage across news outlets, blogs and in Twitterville. Everyone's talking about the big picture. Larry Dignan (thinks it makes sense) and Dana Gardner (doesn't think it makes sense) have more insightful commentary than most stories I've read. Commentators generally mention data centers, servers (i.e. hardware), cloud computing, professional services, Java, IDEs (NetBeans vs. Eclipse - consensus opinion seems to think NetBeans will go the way of the Dodo), Unix (AIX vs. Solaris) and open source. Many of them are saying that it makes sense in a macro-company kind of way. I however, will be focusing on a specific something else where I don't think it makes any sense at all. Then again, in the grander scheme of things there's usually some sort of sacrifice when these things happen, especially today when the flavour of the microsecond is all things cloud-related and not un-sexy-enterprise-off-the-shelf-run-it-in-your-own-data-center software.

My point is that very few reports have touched on something that should be on your mind if you work in enterprise software: what's going to happen to the software stack? There are overlaps EVERYWHERE! There are too many products to talk about in detail but IBM cannot simply throw Sun's stack away because of the backlash they're going to get from customers and the community at large.

If IBM does acquire Sun, they sure as heck aren't doing it for the software (except for perhaps additional "control" over Java). And they sure as hell aren't doing it because Tivoli's run out of role management vendors to acquire and liked VAAU (which became Sun Role Manager) so much they went to Sam Palmisano and told him to buy Sun as punishment for getting to VAAU before them. Does this mean they'll just throw Sun's software division away? Of course not! That would be stupid on IBM's part (and despite what I've written about in the past, I don't think IBM are stupid). They will more than likely run everything separately initially, figure out what bits and pieces fill missing holes in the IBM software portfolio and then "blue-rinse" (rebrand) them. The overlapping pieces will be absorbed into the IBM blue-ether and have useful components re-used within existing IBM software and the perceived useless bits discarded. It's IBM's modus operandi (just look at what they did with their DB2-related acquisitions). It's also what Oracle does, so at least someone else thinks it makes sense.

And here's where I'm going to head down the rabbit hole, because this is all based on a rumour. In other words, it's speculation and anything said is simply mental masturbation.

The least affected IBM software brand will be Lotus. Rational should be relatively unscathed. The other three IBM software brands (Tivoli, WebSphere, Information Management aka DB2) however, will notice a few changes. None will be affected more than WebSphere, but Tivoli comes a close second in the upheaval stakes. This is where the IBM's Identity and Access Management (IAM) suite sits, which is what I'm going to focus on now.

The first win for IBM will be in the marketing stakes. I don't mean this in terms of positive karma or PR, but more in terms of the marketing talent at Sun. This is because Sun has been better at marketing, community building and listening to customers than IBM has within the IAM space. Now, assuming IBM doesn't fire the whole IAM marketing team they'll be inheriting a very strong team of people (yeah I know their engineers aren't too shabby either). In my opinion, Sun understood the evolution in marketing that's been occurring much earlier than IBM and hence are ahead in the game from this standpoint. Actually, pretty much every other big IAM vendor understood this before IBM. In IBM's defence, they are starting to pick up their game and are running with it wholeheartedly.

On to the products. I thought of doing a full comparison by listing each company's full list of IAM products, but then I started writing down IBM's list from the website (in case I missed anything by relying on my memory) and it gave me a headache (Side note to IBM: WTF?! The list has gotten much more complicated and longer. And to add to the confusion, you even list "products" that are actually solutions made from combining different underlying products. If you are able to give an ex-employee who used to architect, implement and sell this stuff for you a headache when going to your website, what do you think customers are going to think? Or maybe I just don't have the mental capacity to read introductory product information about IBM software). Conversely, Sun's list is much easier to follow (although whoever runs the website should probably place Access Manager and Federation Manager in a separate list noting that they've been combined to form OpenSSO). Here's the core Sun IAM list with commentary:
  • Sun Directory Server - IBM has Tivoli Directory Server.
  • Sun Identity Compliance Manager - IBM does not have a direct equivalent.
  • Sun Identity Manager - IBM has Tivoli Identity Manager.
  • Sun OpenSSO Enterprise - IBM has Tivoli Federated Identity Manager and Tivoli Access Manager for e-business (which is actually used as a component within the Federated Identity Manager product, but I won't complicate things here).
  • Sun Role Manager - IBM does not have a direct equivalent.
Thanks to Sun's simpler list, there's a relatively clear picture to work with. I should note that IBM has quite a few more IAM products that I've listed (IBM lists them as part of the Security Management suite), but I'll ignore them because a potential acquisition of Sun should not affect them too much.

What's abundantly clear here is that Sun Role Manager and Sun Identity Compliance Manager (don't confuse this with Tivoli Compliance Insight Manager because the IBM product addresses different requirements) look to be safe from the chopping block. IBM will simply take the 2 products (aside: my understanding is that Compliance Manager is actually derived from Role Manager - Sun people, please correct me if I'm wrong) and "blue-rinse" them. Their names will likely stay the same with "Sun" being replaced with "IBM Tivoli". Either that or IBM will combine them and call it "Tivoli Identity, Access and Role Compliance Manager" or some long-a**ed name that forms yet another T-acronym. At least you can kind of pronounce TIARCM, albeit getting tongue twisted in the process.

As for the other Sun IAM products, their futures are at risk if this rumour proves to be true. IBM's spent shed-loads of money acquiring, "blue-rinsing" and subsequently developing their equivalent products. It's VERY unlikely that IBM will throw that investment away only to repeat the exercise again with Sun's stack. In other words, I have a feeling that in the longer term, Sun Directory Server, Sun Identity Manager and Sun OpenSSO Enterprise are seriously in danger of being "sunsetted" (yeah, I cringed too when I typed it). Interestingly enough, many people are of the opinion that Sun's Identity Manager is a superior product to Tivoli Identity Manager. Conversely, the reverse is true when comparing Federation/Access Management products. Opinions such as these are of course subjective and depend on the requirements at hand and people's personal preferences. The truth is that they are all pretty solid, mature products in their own right so there's no easy answer in making a decision to pick Sun's version over IBM's or vice versa. I see 3 logical possibilities here:
  1. IBM "sunsets" the relevant overlapping Sun IAM products, which will mean that they'll continue to support existing customers but gradually migrate them over to the Tivoli versions.
  2. IBM markets the Sun IAM products as open source alternatives to their enterprise incarnations.
  3. IBM re-hashes the rather unsuccessful "Express" line of products.
Option 1 will be the least popular alternative in the eyes of customers. But it means BIG services opportunities for IBM and IBM's channel of business partners which provide consulting/implementation services. From an IBM perspective, they would be making the sacrifice early on for the greater good of the company and taking the PR and initial professional services (in having to give away free services for the migration to prevent angry mobs from gathering) hit that comes with it (like they had to do when they acquired Encentuate). This is the "rip the band aid off quickly" approach, but it also means lots of job cuts with the sales and marketing teams being first out the door.

Option 2 is the easy way out, but is also the most expensive. Sun already markets their product line as being open. The heavy-lifting part of the marketing's been done and all IBM has to do is see it through while changing the product names. Unfortunately, this is expensive from an ongoing operational and development standpoint. They may choose to absorb the cost as a "good karma tax", so this option could very well fly. The upheaval to existing Sun teams and customers would also be mitigated. This is the "don't rock the boat" option.

Option 3 is the "marketing blue-rinse" option. It's more or less a hybrid approach of options 1 and 2. IBM will be looking to cut the fat somewhat from a jobs perspective, but not as drastically as they would if they went with option 1. From a technical standpoint, this will be very similar to option 2. The difference is that they bring the products back in-house and promote them as the "light IAM options" for small to medium business. This was exactly the target market for their Express initiative and they may look to re-energise those efforts . Ironically, Tivoli Identity Manager Express was a response to the market perception that Sun Identity Manager is easier to deploy and manage. If this happens, I don't think the Sun products will survive beyond a year or 2. IBM's Express experiment has proven that customers that buy Tivoli still like to choose the heavier version "in case" they need the features and perceived superior stability. Remember, this is not to say the Sun products aren't stable or fully featured. I'm just saying that in this instance, that's what the marketing materials are going to imply and how the sales teams will be selling the products. If not, IBM would look pretty stupid for continuing development on 2 equally good products in parallel that serve the exact same purpose (in the eyes of the customer). If "Express" doesn't sell, this option is simply the less painful, more drawn out, more expensive version of option 1.

No matter which option IBM picks, one thing is certain. They're going to run a fine-tooth comb over the Sun product set, pilfer all the useful bits and roll them in to the existing Tivoli product set. This is good for Tivoli customers but it'll take time for the functionality to start appearing given the speed that IBM moves at.

I don't think competitors like Oracle, CA and Novell will be quaking in their boots though. From an IAM standpoint, any acquisition only increases IBM's market share. It doesn't really give them a big advantage when it comes to product features or functionality. Then again, significantly increased market share is nothing to be sneezed at.

If the rumour proves to be based on solid information and something does happen, the real winners (other than IBM) will be existing IBM customers. The biggest losers? Existing Sun employees and customers, at least from a software perspective.

5 comments:

Nick Crown said...

Nice write-up.

Phill said...

Ian, nice write up but I agree it's a waste of time to write about speculation, though I'll add my 2 cents for the heck of it.

First, IBM is the market leader in IAM in the latest 2007 report [IDC #213650] with 12.4% or $389M+. The next closest is CA with 10.3% who are also declining. Sun sit 16th in the market with less than $44M in revenues and 1.4% market share. Needless to say that what ever IBM do with Sun's products, it won't have much of an impact on the market as a whole.

You are correct, IBM will take the bits of SUN [the whole company] they want and slowly discard the rest. IBM are the best company in the world in terms of making M&A work, so I'm not worried [at least as an IBM employee] about any integration issues.

That is not to say IBM are perfect or that if the acquisition went forward it would be 100% smooth, fact is it won't. Like anything in IT 'stuff' is bound to happen.

However, in terms of IAM, the acquisition will only bolster the current software portfolio and increase IBM's total dominance in the IAM market, increasing their revenue by $100m+ more than their second closest competitor.

Anonymous said...

You forgot the Sun Directory Proxy Server :) The Sun directory/proxy servers simply kick ass and have for years. Just when I didnt think they could top themselves, Sun comes out with a real gem... opensso.

Ian Yip said...

Thanks for the comments all.

Regarding the Sun Directory Proxy Server, Tivoli Directory Server (TDS) has proxying capabilities of its own. Combine that with Tivoli Directory Integrator (TDI) and Tivoli will claim that there's nothing the Sun Directory can do that Tivoli's does not. In other words, no matter how much it "kicks ass", I really don't see IBM pushing TDS down the pecking order.

The same argument stands for OpenSSO. It could very well be the best product of its kind out there (not that I'm saying that it is, because it's highly subjective when 2 competitive products are fairly mature and stable) I really don't see IBM pushing Tivoli Access Manager (TAM) and Tivoli Federated Identity Manager down the pecking order for OpenSSO for the reasons I've pointed out in the blog post.

Stephanie said...
This comment has been removed by the author.