Many a conflicting priority
Security and information access, open source, and the future of applistructure are contention points in your next IT purchasing decision
by Erik Keller -- Manufacturing Business Technology, 7/1/2005 6:00:00 AM
Infrastructure technology—the "inside plumbing" that keeps corporate computing humming—is the kind of purchase that, while often remaining under the radar screen, still gives a business manager pause. Add to that a number of converging trends, and more diligence is required. These include attention to security and information access, open source, and infrastructure's consolidation into the technology stack of major application providers—i.e., "applistructure."
To begin, security threat concerns—both electronic and procedural—are hitting IT staffs, thereby consuming both resources and time. Recent IT spending surveys offered by New York-based Morgan Stanleyplace systems and network security as the No. 1 and No. 2 investment priorities, respectively, for the last 18 months, and with little change expected for the future.
But beyond ensuring that systems are safe from electronic breaches, companies also must enact procedures that ensure information is secure from physical breaches. At the same time, information concerning "material events" must be accessible in a reasonable time frame. These are potentially conflicting business requirements that compel a revised focus on infrastructure investments.
For example, Sarbanes-Oxley Act (Sarbox) compliance requires higher degrees of security and information access. Unfortunately, most companies find their IT strategies are in conflict with Sarbox compliance. One client (a $1-billion manufacturing division of a multinational company) had to stop all new development and deployment of systems in June of last year and devote all 50 members of its IT staff to meeting the needs of Sarbox. This experience is not uncommon.
Other top spend drivers for security and information access solutions for manufacturers include SEC (general); HIPAA (healthcare); FDA (21 CFR Part 11 for pharmaceutical and food); and TREAD (automotive).
On to open source
With unbudgeted projects popping up—such as the aforementioned compliance initiatives—it's no secret that companies are looking for innovative ways to cut infrastructure costs. To this end, the growing movement is toward acceptance of open-source products and services.
In general, open source refers to any program with source code available for use or modification as other developers see fit. (Historically, makers of proprietary software have not made source code generally available.) Open Source also is a certification mark owned by the Open Source Initiative, or OSI.
Initially used for operating systems, such as Linux, open-source software is moving well beyond a few specific technologies (see table, p. 21), and creating a major impact on infrastructure decisions. Open source is free (or close to it) to anyone who agrees to adhere to some simple agreements. Second, any modifications made can and will be shared with others.
While the success of Linux is well known, open-source infrastructure has not yet fared quite as well. But consider this:
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Open-source Apache Web server technology continues to gain market share over Microsoft. Apache holds 70 percent of the Web server market.
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IBM released more than 500 of its patents to the open source community earlier this year, mostly in the area of infrastructure technology. It also recently purchased Gluecode, a vendor that offers Apache Geronimo application server technology. IBM is positioning Gluecode's technology as an inexpensive alternative to IBM's proprietary WebSphere.
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Dell Computer is bringing more open-source technology to its hardware, including adding open-source cluster management capability from Platform Computing to Dell's high-end servers. CEO Michael Dell also recently invested nearly $100 million of his personal fortune in open-systems start-up Red Hat.
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SAP's release of the database Adabas D to open-systems company MySQL AB has started to bear fruit. The rebranded open-source database, MaxDB, is being used in more than 6,000 SAP installations.
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A 2004 study by Boston-based AMR Research on open-source databases predicted that they would gain widespread acceptance by 2006. Its survey of more than 140 IT professionals found little operational differences between open-source and proprietary systems.
One of the gating factors to the acceptance of open-source infrastructure software is the perceived lack of direct support. The recent formation of SpikeSource, an open-source IT services company, is one example of a new type of services company that will emerge to support such products.
Accepting applistructure
These market forces are coming together via applistructure, which is the merger of infrastructure and applications technology. If applistructure is realized, the enterprise software industry is poised to be restructured much the same way that it was in the early 1990s with the advent of client/server and ERP.
The overall complexity of maintaining myriad IT systems has created an entitlement base of technology within most corporations that consumes between 60 percent and 80 percent of the total budget. Integrated enterprise applications were to rein these expenses in, but they haven't.
Applistructure components may come from different companies, but are managed and guaranteed by a single one. The top four companies here, however, are split as to current approach: IBM and Microsoft are choosing application partners (for now), while Oracle and SAP are doing so by themselves (for now). Both sets can (and most likely will) alter their current paths to become a bit more like their counterparts.
All of this represents both a challenge and an opportunity for manufacturing companies today as we all play a part in defining the next wave of infrastructure investment.
Top-ranking infrastructure suppliers
| Rank Company | Total revenue (in millions of dollars) | |
| IBM | 96,293 | WebSphere one of two dominant infrastructures in manufacturing; iSeries database still a force; will help ISVs offer software as service |
| Hewlett-Packard Co. | 79,905 | Strengths in platforms with the collaborative Business Infrastructure, and services, including for ERP, supply chain, and RFID projects; new CEO is about operations, not image |
| Microsoft Corp. | 38,480 | Microsoft .NET a powerful computing infrastructure in manufacturing; SQL Server. BizTalk Server, and Sharepoint Portal powerful combination |
| Sun Microsystems | 11,230 | Just agreed to buy data storage vendor StorageTek; builds on platform & Java heritage with utility computing solutions |
| Oracle Corp. | 10,556 | The most widely deployed database in manufacturing; investments being made in data storage arena |
| EMC Corp. | 8,229 | Information storage systems vendor builds off of 2003 acquisitions of Documentum, Legato as data storage sector heats up |
| Symantec/Veritas | 4,468 | Security software leader set to merge with storage software vendor Veritas; figure reflects combined revenues |
| Computer Associates | 3,476 | Systems, security, storage, and other IT management solutions; will modify five years of financial statements based on 10 improper contracts |
| BEA | 1080 | Enterprise infrastructure software supports service-oriented architectures; working with IBM and Microsoft to enhance messaging reliabiity in WebLogic 9.0 |
| TIBCO | 387 | Business integration software vendor expands into RFID solutions; executives named in class-action suits for alleged false and misleading statements |
