IBM buys apps management firm
Published: 29 Jul 2004 15:40 BST
IBM said on Thursday it will acquire Cyanea, a three-year-old company with close ties to Big Blue, to beef up its portfolio of application management tools.
Cyanea, a California-based firm with about 75 employees, makes software is designed to spot and diagnose problems to reduce system downtime.
IBM said Cyanea's president and chief executive, James Chong, will head up an effort within IBM to consolidate its different application management tools. Financial terms were not disclosed.
Cyanea's software is used to monitor transactions running on mainframe systems -- a market dominated by IBM -- and Java server applications, notably those written to run on IBM's WebSphere Java infrastructure software.
Since 2002, IBM has resold Cyanea's software as part of its WebSphere brand. IBM was also an original investor in Cyanea, having taken a roughly 11 percent share of the company at its founding. With the acquisition, IBM will buy out the other venture capital firms which were original investors.
The planned Cyanea purchase fits a clear pattern at IBM's $14bn software group. The company has acquired several smaller, specialised firms which are already IBM partners or have written software that complements IBM's own infrastructure software.
The purchase of Cyanea, which represents the seventeenth company IBM software has bought since 2001, is consistent with IBM's plan to build out a broad set of tools for building, running and managing business applications, said John Swainson, IBM's vice president of worldwide software sales. Swainson recently took on the head software sales job after leading the WebSphere division.
"We are always making buy versus build decisions about how we can extend our portfolio," said Swainson.
Swainson said application management -- a market which has several smaller, niche providers -- is an area where IBM wants a full set of offerings that span older CICS and IMS mainframe-based transaction systems, along with WebSphere, which runs on Windows, Linux and Unix operating systems.
Earlier this year IBM acquired Candle, an 18-year-old company which also sells application management tools. Chong and the Cyanea team are tasked with consolidating the Cyanea tools with those from Candle as well as Tivoli monitoring tools, Swainson said.
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