IBM buys CrossWorlds

IBM last week agreed to purchase Enterprise Application Integration (EAI) player CrossWorlds Software in a cash deal valued at $129 million. The move—IBM's biggest purchase since its deal last year to buy Informix—signals IBM's continuing interest in buying companies that can add to its software portfolio.

The CrossWorlds acquisition enhances IBM's WebSphere and MQ middleware product lines. CrossWorlds' software helps customers automate business processes that integrate multiple enterprise applications such as customer relationship management, supply chain, and ERP.

CrossWorlds has 350 employees and touts customers that include Caterpillar, Siemens and Whirlpool Corp. IBM and CrossWorlds have many common customers as a result of businesses alliances the companies have forged over the last few years.

"The CrossWorlds team will become a part of the IBM company. We think this is a great marriage of skills, talent, and technology," said Steve Mills, senior vice president and group executive, IBM Software Group, at a press gathering announcing the move.

CrossWorlds has struggled to live up to the hype it generated when it took on the role of 'poster child' for the nascent EAI segment. Controversy surrounded the company when company founder, Katrina Garnett, posed in an urbane black evening dress for fashion photographer Richard Avedon. The cost of ads appearing in mainstream media consumed a large portion of the young CrossWorlds' total marketing budget.

The company's role in defining EAI was noted at the time of the acquisition. "CrossWorlds has provided category definition around EAI," said IBM's Mills.

In a bulletin, Tyler McDaniel, an analyst at the Hurwitz Group, noted that CrossWorlds had already been leveraging MQSeries, and that "the time-to-impact" of the new technology within the IBM family should be quite short.

"IBM effectively swallows one of the leading best-of-breed integration vendors. There is nothing like buying the competition to solidify leadership," McDaniel added.

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About the Author

Jack Vaughan is former Editor-at-Large at Application Development Trends magazine.