Do you see any competition from open-source application servers?
Not at all. And I don't think we will anytime soon.
Are you feeling any price pressure from open source?
No. Price pressure comes from real adoption -- if people really adopt it, then you'll have real price pressure. If people are not adopting, then there's no price pressure.
You've talked a lot about services-oriented architecture, or SOA. Other companies, including IBM, are talking about it as well. Is there something that you can say that you do differently from the others?
We actually have the real thing. We actually have a product that is an SOA platform product really built from scratch. They're all pre-integrated. You open the box, and you're ready to go and implement a services-oriented architecture application. Everybody else's is 400 products under one name; they're not the real thing. That is a differentiator on its own.
But right now, services-oriented architecture seems to be a pretty technical discussion. Chief executives probably don't talk about SOA.
Some do, but what they do talk about is a more adaptive enterprise. People do understand that their clientele is becoming more literate about the online usage of their services. From that perspective, chief executives understand the value of enabling technology to make that happen faster, because that is a competitive pressure. So, for example, if they're not way in front on online banking, it will be very difficult for a retail bank to survive. They know that.
IBM and Microsoft have lots of different ways to sell into a company. They have more contacts, and they have more products. Is that a challenge for BEA?
That challenge existed before I started in this business.
Every customer we had was -- and could still be -- an IBM customer. You can't forget that at one point in time, there was only one information technology company. That was IBM. There was a monopoly for the whole thing. It was time-share, and they controlled it. By nature, this is the beast. We had to go through that. Oracle had to go through that. Everybody has to grow through that.
One analyst told me that BEA should consider acquisitions as a better way to grow than through organic growth.
We've been very open about acquisitions; 30-some acquisitions since 1998, so that's five or six a year. The analysts refer to "magic acquisitions." They look at us and ask, "What is the next WebLogic?" WebLogic was not a magic acquisition. It's what we made it into.
I'm not precluding a big acquisition or small acquisition, but the one thing I'm focusing on is to add shareholder value by growing licenses. There are a lot of dogs out there. You can buy something and it will go nowhere. Most acquisitions fail.
Are your new products, like Quicksilver (messaging integration software) a way to diversify your products?
It's not to diversify. It's filling the parts. At our size, we can't just sell products anymore. We have to sell both products and vision. We don't have a choice. We can't just keep selling the application server, saying, "But this is SOA. SOA is just an application server." We've got to tool it enough so that people say, "ah, I understand."
It's no different from Microsoft on the desktop. They have to have enough pieces so that everyone is productive the minute they use the system. We need to do the same thing.
