Wednesday, July 30, 2008

IBM to buy ILOG for US$340m

IBM has just officially announced that they have signed an agreement with ILOG regarding a proposed acquisition by IBM of ILOG to be implemented by way of concurrent cash public tender offers in both France and the United States.

Through this proposed transaction, IBM will combine its business process management, business optimization, and service oriented architecture (SOA) technologies with ILOG's Business Rules Management Systems software (i.e. JRules).


This news came as no surprise to me, if not a little overdue. Why do I say this?

In terms of enterprise middleware offerings targeting application development, IBM has all the major pieces (EIP, BPM, ESB/EAI) except for a BRMS. It has a rather basic and crude implementation of a "rules engine" embedded in the WebSphere Process Server (WPS) product but I would hardly call that an "engine". Plus you cannot possibly use that to manage your business rules in the other areas like ETL or as a central, reusable rules repository for the enterprise (er... SOA anyone?).

ILOG, on the other hand, realized that it has a winner on its hand (which company does not have business rules?) but needed to latch on to players in the platform (e.g. WebSphere) and other verticals with complex business rules such as BPM (e.g. FileNet) and ETL (e.g. DataStage) in order to spread its wings. So rather than spreading itself thin by trying to support the myriad of vendors out there, why not stick with just one and do it well? Guess what? It appears that they may have been doing just that all along. FileNet, DataStage and WebSphere are all products under the IBM family and what do you know.... ILOG has out-of-the-box support in JRules for them all!


  1. Given the way the press release was written, it is clear that the golden boy here is JRules. So what will happen to the other products in ILOG's family? Like the CPLEX constraint-based optimization engine and visualization toolkit JViews? Will they end up as just another faceless product in IBM's vast array of offerings? Personally, I've used CPLEX and JViews before and it will be sad to see them flounder under new management.
  2. And the million dollar question (or should I say a few million dollars question)... Will this acquisition prompt Oracle (now owner of BEA) or SUN to make a bid for Fair Isaac for its Blaze Advisor BRMS?

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