Software AG Acquires Terracotta To Boost Cloud Strategy

Java clustering infrastructure provider Terracotta announced this morning that it's being acquired by German business process management (BPM) vendor Software AG. The acquisition will help Software AG to develop its cloud services strategy and increase the performance and scalability of its business software tools, the companies said.

Terracotta CEO Amit Pandey made the case for the acquisition during a conference call with reporters and analysts this morning. He called the deal a "win-win." "Software AG is a company with far greater reach than Terracotta," he said, "both in terms of the sales force and the R&D resources. [They] are going to bring all of that to bear to help us grow our business."

Terracotta will be run as an independent business under the Software AG umbrella, Pandey said, and he will continue to lead that business unit. The resulting combination of big-company resources with small-company agility is "the best of both worlds," he said.

Wolfram Jost, CT of Software AG, said the acquisition would support his company's midterm strategy to become a platform-as-a-service provider.

"We totally believe in the cloud business model for the future," he said, "whether it's public, private, or a hybrid… I think it's important to enter the cloud business model. But to do that, we have one key prerequisite, and this is elastic scale, high-speed and performance."

"The architecture of the future is in-memory-based, and not data-base centric," Jost added. "…This [Terracotta] technology is really the foundation of our future architecture."

All of which makes Terracotta a good fit for the company, the companies said. The San Francisco-based company is the founder of the open source Terracotta project. Terracotta clusters Java Virtual Machines (JVMs) to create a shared memory pool at the Java application tier, which can be used to share data among servers. This shared memory pool can also be employed to coordinate the work of many JVMs. The company's Java infrastructure solution is a commercial offering based on the open-source project.

Terracotta is probably best-known for its commercial development of Ehcache (pronounced "ee-ache-cash"), a widely deployed open-source Java caching solution the company acquired in 2009. Enterprise production deployments of Ehcache, which is available under an Apache 2 license, are estimated to be in the hundreds of thousands. It ships as a component in Hibernate ORM, the Spring Framework, Alfresco CMS, and the Liferay portal. (For more, see "Distributed Enterprise Java Caching Software Gets Native Search.")

Another well-known Terracotta product is BigMemory, a pure Java Ehcache add-on designed to provide an off-heap cache for an instant large memory footprint for hundreds of thousands of Java applications. BigMemory allows Java apps to cache 64 GBs or more of data in an off-heap store that's not subject to garbage collection. (For more, see "BigMemory Takes on Java's Achilles' Heel: Garbage Collection.")

In 2009 the company acquired Quartz, one of the IT industry's most widely deployed, open-source job-scheduling services. Designed to work within or alongside just about any Java EE or Java SE application, it has been deployed in thousands of enterprise production environments (Cisco Systems and Adobe, for example), and companies from Red Hat to SpringSource have built it into their products.

Terracotta operates as a commercial open source organization; Software AG does not. But Jost said his company is embracing that model with this acquisition. "We will continue the open source model that Terracotta has successfully introduced into the market," he said, adding, "For customers on the Terracotta side there will be no change at all."

Pandey sought to reassure the open source community about the impact of the acquisition. "Both Terracotta and Software AG are committed to further investment in our technologies and preserving the vibrant open source communities of Ehcache and Quartz," he said.

The size difference between the two companies is stark: Terracotta employs about 55 people compared with Software AG's 6,000 employees, and the company has 70 subsidiaries worldwide. The Germany company's product offerings, which it groups under the rubric "business process excellence," include the ARIS BPM tool, the webMethods product suite, Adabas data management system and the CentraSite business services repository, as well as a long list of support services.

The acquisition is scheduled to close on June 11. The companies expects to release the first integrated products in the fourth quarter of 2011, and Software AG says to expect its cloud-based platform-as-a-service roll-out in 2012.