In what is being hailed as the largest deal in its 25-year history, enterprise software firm J.D. Edwards this week announced it would pre-integrate its flagship products with IBM’s middleware platform.
The Denver, Colorado-based J.D. Edwards, which makes software designed to help companies manage their books and fulfill orders, said the non-exclusive pact was focused on providing Web Services-type capabilities to its “J.D. Edwards 5” collaborative business applications.
J.D. Edwards CEO Bob Dutkowsky declined comment on the financial terms of the deal, which pre-integrates the company’s product set with IBM’s WebSphere Application Server and Portal, Lotus collaboration tools, and DB2 database.
The deal basically allows J.D. Edwards to sell a single software suite to the enterprise market that covers a wide spectrum of a company’s IT plumbing.
The “J.D Edwards 5” product set includes applications for Enterprise Resource Planning, Customer Relationship Management (CRM), Supply Chain Management, Supplier Relationship Management, and Business Intelligence.
Middleware software is used to connect otherwise separate applications and because IBM’s infrastructure runs on open standards platform, the two sides believe the partnership opens up the door to cash in on the market, estimated at $150 billion.
“This is the biggest technology partnership we’ve announced in 25 years. In addition to opening the door to new revenue opportunity, this makes it easier for our business clients to purchase, deploy and manage the software going forward,” Dutkowsky said.
Dutkowsky conceded the IBM pre-integration would lead to a price hike for J.D. Edwards business applications. However, the sales pitch is that the overall cost for clients looking to install and manage applications within a single environment would be much lower.
“If they’re (business customers) buying and integrating piece parts, the cost is exponential. Previously, a customer would have to buy these applications separately, then spend to integrate them to work together. Now, they can buy all the products with a single procurement and make them work together right away,” he explained.
Because the IBM partnership is non-exclusive, J.D. Edwards customers who use Microsoft or Oracle for database applications can continue to do so.
“The key here is that it’s an open integration. The customer will have the choice not to use the DB2 database if they want to. It’s open. The customer has the flexibility to run whatever competing applications they want,” said Steve Mills, senior vice president of IBM’s Software Group. “Today’s agreement underscores our customers’ demand for open software that will run across a variety of computing systems — unlike other proprietary approaches,” he added.
The pre-integration is expected to begin late this year and be fully available by the middle of 2003.
Mills said the joint package would run on all vendor technologies supported by J.D. Edwards, including Microsoft Windows and UNIX environments from IBM, HP, Sun Microsystems and Unisys.
Big Blue and J.D. Edwards also plan to share sales leads and jointly market the product. The two would also team up on an Integration Center to validate and certify various J2EE compliant hardware configurations new software.