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BEA furthers middleware push

An emerging powerhouse in the transaction processing middleware market, BEA acquires Top End middleware technology and related software from NCR.

BEA Systems continues to gobble up technology on its way to becoming a powerhouse in the transaction processing middleware market.

Today, BEA said it will acquire Top End middleware technology and related software from NCR. Financial terms were not disclosed. BEA will make employment offers to approximately 65 NCR employees responsible for Top End development and service, the company said.

BEA already sells Tuxedo, a similar transaction processing middleware product that it acquired from Novell several years ago.

The company is also acquiring a reputation for buying technology and combining it to create new products.

Next month, BEA will debut a project code-named Iceberg that combines its Tuxedo middleware with MessageQ, a message queuing product, and object request broker technology it purchased from Digital Equipment last year.

Iceberg, along with a similar product already shipping from IBM, called Component Broker, are examples of the consolidation occurring in what has been a staid market for transactional middleware.

Transaction processing middleware, an older technology used for years to manage data traffic on large mainframe and Unix-based systems, is becoming increasingly important as companies build e-commerce systems that combine new Web technology linked to older business applications.

The software is designed to make sure business transactions--credit card orders, airline reservations, money transfers--don't get lost. Products like Top End, Tuxedo, and IBM's CICS and Encina can also be used to access distributed applications running on disparate operating systems and hardware.

Newer products, like Iceberg, and the combination of Microsoft's Transaction Server, Message Queue Server, and its COM (component object model) framework, join new object technology with time-tested transaction software to address emerging e-commerce applications and application integration projects.

These novel products "combine the goodness of the object world with the robustness of transaction processing monitors," said Karen Boucher, an analyst with the Standish Group. "Lots of companies are doing this [integration]. Customers are confused over which package to buy, so this gives them one package to use in a number of different environments."

They also position companies like BEA to address the booming market for software that can act as a bridge to integrate systems from multiple vendors. Companies like CrossWorlds and Vitria also sell application integration software packages specifically made to link dissimilar systems.

BEA plans to combine Top End and Tuxedo into a single, future package, nor directly related to Iceberg, according to the company. The move surprised some market watchers. "I don't understand how they plan to do that [integration]. They're similar products, but they work in two totally different ways," Boucher said.

"They're basically the same product, trying to do the same thing. To combine both...I don't see how that's possible," Boucher said.

BEA did not disclose exact financial terms of the deal. But Wendell Laidley, an analyst with Deutsche Morgan Grenfell said he estimates that BEA paid between $70 million and $80 million for Top End. The company will disclose additional details tomorrow when it announces its quarterly earnings.

Laidley was also at a loss to explain why BEA would buy a technology so similar to something it already owns. But, he said the deal is "more of a play to get additional customers."

But Yefim Natis, an analyst with the Gartner Group, said the reason is clear. "Now, when you need to build enterprise systems, you go to BEA. They become the authority on enterprise computing."

Boucher also praised Top End's technology. "It's the cream of the crop of transaction processing monitors. It's an excellent product," she said.