Ardent Software: Will Informix Merger Affect their Success?

  • Written By: M. Reed
  • Published On: April 10 2000



Vendor Genesis

Ardent Software, formerly known as VMARK Software, was founded in the mid-1980's to develop and market extended relational database systems. The product originally ran on UNIX operating systems, and soon the systems were also licensed for use as an embedded part of business applications.

In February 1998, Ardent merged with Unidata Inc., a marketer and developer of relational databases, object databases and software tools. In addition, Ardent entered the data warehousing market in 1996 with the initial release of DataStage, an extract/transform/load tool. The vendor has also acquired a number of other software vendors in recent years, and has attempted to integrate the purchased technologies into their existing DataStage product. The tool now offers metadata management and data quality management, which according to the vendor will "simplify integration of multiple data sources and business intelligence tools".

The Ardent product is a suite that contains:

  • Extract/Transform/Load capabilities in the form of DataStage 3.6. This product has made Ardent one of the top three ETL vendors.

  • Metadata management technology acquired with the purchase of Dovetail Software. This is a proprietary meta model, Ardent promises an XML-compliant repository in a future release.

  • Data quality technologies acquired with the purchase of Prism Solutions. Prism had previously purchased QDB Solutions, which created QDB/Analyze, a tool for complex data cleansing.

  • Improved mainframe functionality, also acquired with the purchase of Prism Solutions. Prism's mainframe based ETL tool provides Ardent with mainframe job scheduling and improved access to legacy data sources.

The most recent release is known as DataStage XE and includes all the features of DataStage 3.6 and the addition of support for unstructured data (i.e., XML). This was announced as the "first component of Ardent's newly announced Enterprise Information Infrastructure (EII) initiative by addressing the structured data domain."

According to Mikael Wipperfeld, Vice President of data warehouse marketing at Ardent, "Customers are looking for a complete set of information infrastructure capabilities for their business intelligence and analytical applications which will enable them to adapt their data-to-information processes as their environments change."

In the second phase of this effort, Ardent intends to deliver Web-enabled access to the business and technical metadata. Access to unstructured datasources such as spreadsheets, presentations, and text files will also be added. In the third phase, Ardent plans to deliver the foundation for an enterprise portal by utilizing an integration layer that unifies related content and enables personalization.

The latest development was the announcement on December 1, 1999 that Ardent Software was to be acquired by Informix, a major relational and object database vendor. The transaction was completed on March 1, 2000. Under terms of the transaction, Ardent stockholders will receive 3.5 shares of Informix common stock for each share of Ardent stock. The ramifications of this development are still uncertain, as Ardent was highly successful in 1999, and Informix is still rebounding from near-death (their stock had plummeted to as low as $6 per share within the last 52 weeks, and sales of their core database products were poor). How successful the marriage of the two companies will be remains to be seen.

Another complicating factor is the lawsuit which IBM has filed against Informix for patent infringement. Many of the six patents referred to in the suit are old, one dating back to 1981, and Informix's position is that the suit is frivolous. However, defending against the suit will take cycles away from Informix executives who could better spend their time on Ardent software and personnel.

Vendor Strategy and Trajectory

Ardent's stated strategy before the announcement of the Informix acquisition was in the area of an "enterprise application architecture". As explained above, this was supposed to build a framework that would allow access to structured (i.e., relational database tables), and unstructured (i.e., XML or text files), in a seamless manner to allow data access and integration. Ardent was well positioned to succeed in this direction given its integration of the acquired data cleansing, mainframe data access, and metadata management tools.

After the announcement of the Informix acquisition, Ardent added a strategic move towards "web analytics". This makes some sense given Informix's analytic application strengths provided by its acquisition of Cloudscape, which brought a 100% pure-Java database management system into the mix, as well as web analytics combined in the i.Informix web-enabling product. The key will be a successful integration of the products, clear product focus, and the ability to prevent employee attrition.

Ardent commented that in addition, the acquisition by Informix provides it with access to Informix's worldwide sales and support staffs and increased global reach. Ardent also gets to leverage Informix's installed base, which is known to be extremely loyal.

Vendor Strengths

Ardent has been consistently successful in the extract/transform/load market, especially since users moved away from scripted data movement tools to a graphical user interface. Their market penetration has been consistently higher from period to period, and revenues have increased steadily. The DataStage product has been superior to many of its competitors due to advanced data cleansing capabilities and superior mainframe data access. The addition of a metadata management layer was key to staying ahead of the competition.

Ardent has also been very financially successful, and Informix has returned to consistent profitability over the last 8 quarters.

Vendor Challenges

Obviously, the most difficult challenge for Ardent Software now is the successful transition to Informix. This will be discussed further in vendor predictions and recommendations. In addition, some other ETL vendors, particularly Informatica, are considered to be superior in core data movement technology.

Another challenge that would have been faced by Ardent before the Informix acquisition (and may still be), is that some of its competition are very large software companies with deep research & development pockets. Examples of vendors in this category are IBM, Microsoft, Oracle, and Computer Associates (who may not choose to spend R&D dollars on ETL products).

An additional challenge has been Ardent's lack of name recognition and market awareness. We believe this will be alleviated to some degree by the Informix merger, since Informix is extremely well known throughout the data warehouse industry. Informix must be very careful to integrate the corporate cultures in very short order to keep attrition to a minimum. The clash between east coast-based Ardent's culture and west coast-based Informix could be damaging.

Other challenges involve customers developing the perception that they must have an Informix database in order to use Ardent data movement software, or that DataStage will work most efficiently with Informix databases. This must be quickly addressed with a marketing campaign.

One challenge that will be difficult to address is getting cooperation from other vendors in the database space who consider Informix a competitor. Most of the more successful ETL vendors have taken great pains to be impartial (or at least appear to be) by not also owning a database product. Companies such as Microsoft and Oracle might be less willing to provide quality assurance and API assistance to a direct competitor.

Vendor Predictions

We predict that the completion of the Informix acquisition, with the attendant staff attrition, adjustment to a new corporate culture, and other inevitabilities of a merger, will cause Ardent's release schedules to suffer by as much as 6 months (80% probability). Schedules will suffer further due to attempts to integrate functions from DataStage and Informix's products into each other (80% probability). There will also be a loss of some key personnel in the areas of sales, marketing, product management, and development (50% probability).

TEC also predicts that other, smaller ETL and infrastructure vendors such as Informatica and Sagent will be forced to merge with larger software vendors (such as Sybase) in order to be able to compete in this market with behemoths such as Computer Associates, Informix/Ardent, Oracle, and Microsoft.

Vendor Recommendations

Ardent and Informix should do everything in their power to ensure a smooth transition for all the affected employees. Informix would also be well advised to allow the current Ardent management to continue to control of their particular product strategies and marketing. Changes in announced dates for beta release schedules and general availability of software should be kept to an absolute minimum. One example of how not to do this is the Computer Associates/Platinum Technology merger. This merger caused the release date for DecisionBase (a competitor of DataStage) to be knocked nine months off schedule, a virtual lifetime in the software industry. DecisionBase may never recover its momentum.

User Recommendations

Customers evaluating data movement and data infrastructure technologies should definitely include DataStage on a list of possibilities. However, close attention should be paid to how successful the merger is progressing. The first sign of trouble may be a change in a previously announced release date. If this occurs, the vendor (at this point Informix), should be closely questioned on the reasoning. The customer can then decide whether the explanation is reasonable and may work in their favor (i.e., the addition of new features the customer needs), or that the vendor is trying to cover for the fact that the marriage is not going smoothly. Informix is moving to a strong web/e-business-centric solution, so DataStage in its future releases will be most appropriate to customers evaluating these types of solutions. Other products in this space that should be evaluated are Informatica PowerMart, Sagent DataLoad, IBM's Visual Warehouse, and Computer Associates DecisionBase (when version 2.0 becomes available). Customers looking for specific point-to-point ETL solutions, particularly to extract data from ERP systems, can also consider Acta and Hummingbird.

 
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