Intelligent Enterprise

Closing the E-Content Circle

Macromedia snags Allaire, and unifies Web design, development, and application server tools

In Brief

NetIQ Corp. and WebTrends Corp. have announced their merger, which will give NetIQ a 76 percent stake in the combined entity following a stock swap valued at about $1 billion. Ariba Inc. and Vignette Corp. have formed an alliance to market a joint solution that melds content and personalization tools from Vignette's E-Business Application Platform with the Ariba B2B Commerce Platform. Ariba has also acquired Agile Software Corp. Business Objects and Autonomy Corp. PLC have entered into an agreement that integrates Autonomy's technology into BusinessObjects Infoview. Sun Microsystems has settled its Java lawsuit with Microsoft. Microsoft will pay Sun $20 million and will not use Sun's "Java Compatible" trademark. The settlement also severs Microsoft's Java technology licensing agreement with Sun. Microsoft has introduced the Java User Migration Path (JUMP) to Microsoft .Net technology. Mercator Software Inc. has named former IBM overseas integration services manager Roy C. King as its new president and CEO. Onyx Software Corp. has purchased RevenueLab. RevenueLab CEO Kevin J. Corcoran will become Chief Marketing Officer at Onyx. Covisint Inc. has selected the Documentum 4i E-Business content management platform for its automotive e-business exchanges.

Independent application server companies are a dying breed. As Brokat AG's acquisition of GemStone Systems Inc., Hewlett-Packard's acquisition of Bluestone Software Inc., and Sun Microsystems' acquisition of NetDynamics show, the move toward integrating application server products within a larger e-business solution is obviously a strategic one. With the recent announcement of a definitive merger agreement with Allaire Corp., Macromedia Inc. moves closer to its goal of controlling the complete e-content management lifecycle.

The combined company, which will keep the Macromedia name, will unite the Web design and development communities and enable Web professionals to build both the look of a Web site and the application logic behind it. Macromedia's December 1999 acquisition of Andromedia Inc. and its Aria and LikeMinds product lines, which provide enterprises with Web measurement, analysis, and personalization tools, adds the other critical elements of Macromedia's drive toward e-business solution leadership.

Allaire was obviously ripe for the picking - despite a strong market presence, its shares had dropped from a high of $92 to under $10, and it had posted losses for several consecutive quarters in 2000. The dot-com meltdown and a rapidly consolidating Internet tools market both took a heavy toll on the company's ability to remain independent.

Rob Burgess, chairman and CEO of Macromedia, will continue as chairman and CEO of the combined company. Jeremy Allaire, founder and CTO of Allaire, will be the CTO of Macromedia, reporting to Kevin Lynch, president of Macromedia products.

With the $360 million Allaire merger, Macromedia expands its own product lines - the Dreamweaver visual HTML editor and Flash multimedia development tool - with Allaire's ColdFusion, a cross-platform Web application server, and JRun, a Java 2 Enterprise Edition (J2EE)-compatible application server. Burgess stressed in a conference call that the companies have very compatible cultures and product lines that complement each other.

The combined company plans to expand its Web development platform to support open industry standards. The first step is to deliver on Allaire's plan to bring the development model of ColdFusion to the J2EE standard for building applications on the Java platform using XML and Java server pages (JSP). The next step will be to develop a set of reusable components and application logic that enhance the major software platforms, including Java and Microsoft .Net.

According to Macromedia, as the Web evolves, users will access content not just through PCs but via a wide variety of devices. The combined company plans to offer developers an efficient way to develop once for multiple devices and then serve these applications without having to redevelop application logic for each device.

However, despite these ambitious plans, analysts believe that Macromedia may have a few minor obstacles to overcome first. Mark Driver, a Gartner Group Inc. analyst, points to the slight overlap of Macromedia's Dreamweaver and Allaire's Cold Fusion and JRun Studio. In addition, this merger puts Macromedia in direct competition for high-end deals with some of its current OEMs and partners, which include companies such as IBM and WebGain. He warns in a Gartner Group report, "Macromedia must carefully foster its relationships with these vendors as it executes its own expanding tools strategy - a difficult proposition" (January 17, 2001).

But Macromedia says it will continue to work closely with its partners and stresses that its software will continue to support a wide range of industry-leading servers and server scripting languages. Macromedia expects its customers will use its software, both authoring tools and servers, in conjunction with software from companies such as IBM, BEA Systems Inc., Microsoft, Sun Microsystems, Vignette Corp., Art Technology Group Inc., BroadVision Inc., and others.

Michelle Nichols