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Oracle Further Orchestrates Its SOA Forays Part One: Event Summary and Market Impact

Written By: Predrag Jakovljevic
Published On: March 14 2005

Event Summary

The main idea behind this article is not to further delve into the strengths and weaknesses of the impending merger between Oracle Corporation (NASDAQ: ORCL), the largest database and enterprise software provider (recently "inaugurated" the number two leading business applications provider), with its second largest rival, PeopleSoft, Inc. (NASDAQ: PSFT). Its purpose is to analyze why one should never underestimate Oracle. Oracle has been depicted as a high-roller, especially given its exploit with PeopleSoft (see Frantic Merger-Mania Spiced Up With Vendettas Leaves Customers Anxious and its unwavering appetite for other direct, large competitors. Its acquisition "wish list," revealed in 2004 during its anti-trust trial (Oracle's antitrust trial versus the Department of Justice at the US District Court in San Francisco, California), included high-profile competitors like the middleware rival BEA Systems, the database competitor Sybase, the leading business intelligence (BI) provider Business Objects, and other notable business applications players like Siebel Systems and Lawson Software. Yet, Oracle persevered and overcame several hurdles to acquire PeopleSoft and the court trial subsequently resulted with a favorable ruling for Oracle by the federal judge on September 9, definitely marked the turnaround point of the hostile acquisition saga.

However, in a subtle and thoughtful way, Oracle continues to pursue its internally developed product strategy, which is backed by occasional, smaller, and more focused acquisitions. Possibly the best example of this is the recent unveiling of what could be the industry's first and most complete service-oriented architecture (SOA) and integration platform, featuring the Oracle BPEL (Business Process Execution Language) Process Manager product. Through Oracle's quiet acquisition of a privately-held business process management (BPM) pioneer startup, Collaxa Inc., (located near Oracle's head office in Redwood Shores, California), Oracle gained technology to make it easier for organizations to orchestrate Web services and automate business processes.

Oracle's integration solution aims at enabling organizations to deploy open and flexible business processes that leverage existing information technology (IT) assets to adapt to changing business demands. Building on the existing BPM and Web services capabilities of Oracle Application Server 10g, Oracle now boasts possibly the most complete integration solution. This solution includes Web services, SOA, and BPEL support, the business activity monitoring (BAM) technology (see Business Activity Monitoring—Watching The Store For You), rules-based engine, BPM, as well as traditional enterprise application integration (EAI) capabilities. For example, the Oracle Integration BAM component monitors business activities across an enterprise. It has the ability to collect events from all of Oracle's integration components and adapters. Events can be used to generate metrics and key performance indicators (KPI) that are critical to monitoring the enterprise. It also comes with a customizable, Web-based dashboard and an analysis and alerting framework. Thus, by using Oracle BPEL Process Manager and the entire Oracle integration solution, companies should be able to leverage standard Web service interfaces and portable business processes to mitigate the cost of integrating business applications.

Oracle's BPEL Process Manager (formerly the Collaxa BPEL Server product) supports the industry-standard BPEL specification, which is backed by Oracle's traditional foes (though, in this case, its "brothers in arms"): Microsoft, IBM, SAP, and BEA (although BEA currently does not have a BPEL runtime engine built-in as part of the WebLogic core application server product). BPEL is also widely recognized as an enterprise blueprint for reducing the cost, complexity, and inflexibility of integration projects. The former Collaxa product, often hailed as the best BPEL implementation on the market, enables organizations to implement adaptive transactions and collaborative business processes, based on composite applications, with relative ease. The solution includes an engine for executing business processes; a console to monitor, manage and debug business processes; and a rich graphical interface to design and build business processes. Similar to other Oracle technology products, Oracle BPEL Process Manager adheres to open standards and can be deployed on any Java 2 Enterprise Edition (J2EE) compatible server. Thus, the product should provide a comprehensive, standards-based, and a fairly easy-to-use solution for creating, deploying, and managing cross-application business processes with both automated and human workflow steps, thus enabling a true SOA.

Collaxa has had a long history with BPEL, creating one of the first and most proven implementations of BPEL. With its native BPEL engine, Collaxa has provided organizations, such as the European Space Agency, SAIC, and British American Tobacco, with an open means for executing business processes written in BPEL. When coupled with Oracle Application Server 10g, Oracle believes this native BPEL engine completes its comprehensive SOA and integration platform. Oracle BPEL Process Manager has, for some time, been available as a free download and evaluation from Oracle Technology Network (http://otn.oracle.com), and can be purchased either as part of Oracle Application Server 10g Enterprise Edition for $30,000 (USD) per processor or as a stand-alone product for a higher price of $40,000 (USD) per processor.

This is Part One of a six-part note.

Part Two will cover strategy.

Part Three will discuss strategy shifts.

Part Four covers SOA and Web services.

Part Five analyzes the Collaxa acquisition.

Part Six will discuss weaknesses and make user recommendations.

Market Impact

Oracle, despite being labeled an "idealist" with lofty goals, is nonetheless a pragmatic vendor that still listens to the voice of the customer and to market sentiments. The best example of this is the forthcoming release of Oracle E-Business Suite 11i.10. After about 15 months of development and over 2,000 enhancements, Oracle E-Business represents possibly the largest release so far. It meets additional US regulatory compliances across several industries, such electronic signatures and secure audit trails to comply with the Food and Drug Administration's 21 CFR, Part 11 regulation; patient information management as set in the Health Insurance Patient Portability Act (HIPPA); and compliancy with accounting procedures defined in the recently passed Sarbanes-Oxley Act (SOX). The Oracle Financials suite further leverages extensible business reporting language (XBRL), and extensible markup language-based (XML) standard for financial reporting.

As a result of Oracle's attentiveness, Oracle E-Business Suite 11i.10 offers a slew of new features aimed at a number of selected industries of focus, such as aviation and defense (A&D), automotive, telecommunications, consumer packaged goods (CPG), government, high-tech, healthcare, and life sciences. An example of Oracle focusing on verticals would be that the Oracle E-Business Suite 11i.10 release includes multiple enhancements for the for the process industry, such as complete support for the above 21 CFR 11 compliance, a graphical recipe designer, and clinical trails data management.

Also, rather than traditionally delivering a horizontally broad, functional product, and relying on its technical savvy sales force to "push" applications on top of the Oracle database, application server, development environment, and middleware stack, Oracle is increasingly relying on industry experts within its applications' sales and pre-sales teams. As a result, in 2003 Oracle reorganized its various North American commercial sales force so each would have an particular focus on either database technology, application server technology, or applications software products. Oracle simplified its sales coverage model, and now the wheels are set in motion for other geographic regions to follow suit.

Oracle Technology Strategy

Oracle's underlying technological strategy, whereby the ease of integration (even with other applications), the consolidation of databases, data models, and servers, remains the fundamental theme behind all Oracle developments. Oracle's stated goal is to provide customers with scalable, reliable, and secure database technology software, and to give integrated business applications software that provide transactional efficiency and quality information at a reasonably lower total cost of ownership (TCO).

Oracle's software platform is based on an Internet architecture comprised of interconnected database servers, application servers, and client computers or devices running on Web browsers, which allows end users to access business data and applications through standard Web browsers virtually from anywhere. Enterprises can also manage business information and applications from centralized locations. Thus database servers manage underlying business information, while application servers run the business applications. This is in three separate layers within Oracle's technology stack. In contrast, traditional client/server computing architectures require that each client side computer run and manage its own applications and be updated every time an application changes.

Oracle's integrated, component-based architecture can be adapted to the specific needs of many industries and is supported on many different operating systems, including Linux, UNIX, and Microsoft Windows, albeit only on the Oracle database management system (Oracle Database) platform. Oracle Information Architecture, which underlies the Oracle database, application server, and enterprise business applications, is integrated, modular, and based on industry standards. It is designed to eliminate information fragmentation and to provide companies with consolidated information needed to run businesses more effectively.

Its foundation is a grid computing infrastructure that dynamically provisions processing power and storage to keep applications running smoothly without interruption and at a higher performance level. In a manner of speaking, grid is a form of networking. But, unlike conventional networks that focus on communication among devices, grid computing harnesses the unused processing cycles of all computers in a network for solving problems too intensive for any stand-alone machine. It essentially runs all applications centrally, and parcels out the load across low-cost commodity hardware.

Grid computing requires a special software infrastructure that virtualizes and supports IT resources for delivering the highest quality of service at the lowest cost. Subsequently, Oracle recently espoused its total cluster awareness capability, which looks across unique instances of Oracle systems to ensure a consistent quality of service (QOS). This is especially important when enterprise systems are exposed to new constituencies, like when an ERP suite is opened up to direct access and the interaction of trading partners (customers or suppliers). Grid optimizations should enable customers to have improved availability with their IT systems and lower hardware and administration costs.

This concludes Part One of a six-part note.

Part Two will cover strategy.

Part Three will discuss strategy shifts.

Part Four covers SOA and Web services.

Part Five analyzes the Collaxa acquisition.

Part Six will discuss weaknesses and make user recommendations.

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