IBM acquires Ascential

IBM’s recent acquisition of enterprise data-integration specialist Ascential, for $1.1bn in cash, has further stirred up the traditional three-horse data integration race between the company and its two main rivals, Tibco and webMethods.

Tellingly, the IBM deal followed Tibco’s announcement, just days earlier, that it will acquire mainframe integration and application-development player ObjectStar for an undisclosed fee. It suggests that IBM’s timing may have been designed to remind the market that the company is still in the driving seat when it comes to enterprise-data integration.

IBM and Ascential have had ties for years – the latter was once part of Informix, which itself was acquired by IBM in 2001. Ascential was spun off and spent several years as an independent business, but it continued to partner with IBM. The company’s software already integrates with IBM WebSphere Business Integration software as part of a service-oriented architecture (SOA), and will help to enable IBM’s ‘on demand’ strategy.

The acquisition should complement and strengthen IBM’s fast-growing information integration business, a key part of the company’s information management efforts and a unit that produced triple-digit growth in 2004. Ascential Software also grew rapidly in 2004, with a reported 46 per cent total revenue increase to $271.9m.

While Informix gave IBM an edge in database management, Ascential provides it with strength in the extract, transform and load (ETL) segment of integration, a sector growing at an annual rate of 10 per cent, according to Forrester Research.

One of the applications of ETL is data warehousing. Ascential’s data integration software helps customers to build enterprise data warehouses, power business-intelligence systems, consolidate enterprise applications, and create and manage repositories of critical business information.

“Information integration is an important enabler of an on demand business strategy and customers are increasing their investments in software that allows them to rapidly analyse, consolidate and extract value from their business data,” says Steve Mills, senior VP and group executive at IBM Software Group.

Tim Friedman, analyst at Gartner Research, believes that the acquisition is a positive development. “It’s a natural extension of IBM’s established partnership with Ascential. The deal will significantly broaden IBM’s integration offerings, giving WebSphere Information Integrator needed ETL and data quality functionality, and further complementing WebSphere’s process integration offerings,” he says.

Tibco’s acquisition of ObjectStar, meanwhile, is intended to help the company make inroads into IBM’s lead in the mainframe arena.