Integration by Consolidation: Can Big Vendors Deliver?

Loraine Lawson

One thing you can say about Oracle's Larry Ellison: He's not afraid of trash talk and taunting the competition. For instance, this year, he made headlines when he pretty much announced Oracle would solve your integration headaches by getting you to standardize everything on Oracle.


Ellison may be very public about the intention, but Oracle certainly isn't the only big vendor out there pushing highly integrated stacks and software/hardware solutions. By and large, all the big names-IBM, Oracle, HP, etc-are pursuing the same strategy, which is to own more of your IT business, with promises of integration being the common sales pitch.


And this is probably only the beginning, as the tech sector is on a buying spree once again, with large vendors snapping up smaller technology companies.


"There's chum in the financial waters and the sharks are circling," warned IT Business Edge's Arthur Cole. "Could it be that the tech industry is on the verge of a feeding frenzy that would make the past year or so look tame by comparison?"


Integration certainly sounds like a good reason to consider consolidation, provided the idea of "One Stack to Rule Them All" doesn't bother you. But the real question is whether big vendors can actually deliver on their integration promises. Peter Sondergaard, a Gartner senior vice president of research, thinks not.


ComputerWorld covered Sondergaard's remarks about the rise of what he calls "super vendors" at Gartner's recent Symposium ITxpo in Florida. According to the article, Sondergaard warned that integration across an entire vendor's stack "is impossible to maintain long term-users will not accept architectural mediocrity."


Apparently, Gartner sees part of the problem as these companies are acquiring the technology rather than developing it internally.


Technology analyst and IT Business Edge blogger Rob Enderle disagrees that research and development are more successful growth strategies than acquisitions:

Small companies have proven better at initially fleshing out an idea and bringing it to market. A larger firm then buys the smaller company and attempts to integrate the offering. Here is where the problem typically comes up. But it is generally easier to integrate something that has made it to market than to figure out how to market something new and unique for a large company.

He also points out the irony of Gartner criticizing the merger-and-acquisition approach, given that buy-outs constitute a large part of Gartner's own growth. The discussion gets a big ugly from there, with Enderle questioning whether Gartner could be predicting its own demise, but that's a digression from our point today, so I'll let you read his post for more on that.


Speaking of Enderle and the rise of "super vendors," I also recommend you check out Enderle's recent piece, "The Scariest Company In Tech," which appeared Wednesday on Conceivably Tech. It's a fascinating look at how Oracle uses old-style corporate "intelligence" (some might say espionage, but whatever) to create a competitive edge.

Add Comment      Leave a comment on this blog post
Oct 21, 2010 2:44 AM Yves de Montcheuil Yves de Montcheuil  says:

@Loraine, a megavendor providing all the IT stack only means one type of integration: billing.  And even this... 

It's not because Oracle has bought a zillion companies in the past 5 years that all of a sudden all these technologies interoperate smoothly.  You still need data/application integration to make them work.  The only way to guarantee true interoperability from day one is to grow systems from the same codebase. 

In a field that is closer to home, look at Informatica. They bought a data quality vendor - what, 5 years ago?  And it took them 4 years to really integrate the product in Informatica 9.  Then they bought their partner Siperian - how long before they have a unified data management platform?

On the other hand, at Talend we grew our open source data management platform from a single code base, with only a technology acquisition along the way (technology pieces, not a finished product), and here we have a truly unified platform for data integration, data quality and MDM.

Sure, Oracle, IBM, HP, SAP, they can all deliver.  With lots of services. Which will only add to the bill.  Which by the way will be all the more steep that you loose all negotiating power when you work with only one vendor...



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