Commentary: Java's widening gulf

While war has not yet been declared among Java application server vendors, this week's JavaOne conference in San Francisco did showcase their lack of unity.

Oracle CEO Larry Ellison and BEA Systems CEO Bill Coleman traded jabs in successive speeches on Thursday, agreeing only in their criticism of IBM's rival offerings. While BEA, Oracle and Iona Technologies criticized each other, IBM (which has long-standing disputes with Sun Microsystems) had a relatively small presence at JavaOne.

BEA and IBM rank first and second, respectively, in the lucrative market for application server software ($1.6 billion in 2000, growing at better than 40 percent annually through 2005) for handling e-commerce transactions. Meanwhile, Oracle is arguing that its application server is a faster and lower-cost alternative.

We interpret the message from JavaOne as follows: Users should not expect 100 percent compatibility among different Java vendors' platforms, any more than they should expect that from different versions of Unix. And the gulf between different Java solutions will widen.

The Java disputes are reminiscent of the wars of words between Unix vendors--and some of the same people are involved. Each Java vendor is primarily interested in selling its products at the expense of its rivals, which include the other Java vendors as well as Microsoft.

This is the latest demonstration of a key hindrance to standards development involving multiple vendors: When money is to be made, the desire for competitive advantage overwhelms the desire to create standards.

As to which vendor is right--all of their criticisms of each other have some validity. All of the Java vendors have new versions and facilities in development, and the Java standard itself is still evolving. The vendors hone their messages to sound as though all the needed elements are in place today, but in fact they no more have complete Web platforms running than does Microsoft with its .Net platform.

IBM is a version behind, and its products have not been certified by Sun as Java-compliant (as its rivals point out), although this lack of certification is at least partly because of the ongoing disputes between the two vendors. BEA's solution is incomplete (as Iona argues), although its solutions are advancing quickly.

Borland currently offers a fine tool set, in part because it is not tied to a single application server platform (as are those from IBM, BEA and Oracle). Ultimately, however, users will want development tools that are more tightly coupled to their specific application server environment, rather than relying on those from a small independent vendor.

Who'll succeed, who'll suffer
For this reason, we believe IBM and BEA will ultimately capture the lion's share of the Java development tool environment--once their tool sets are fully developed. Still, Borland and Iona could flourish in user environments with multiple Java app servers and will attempt to offer heterogeneous solutions that embrace Java 2 Enterprise Edition (J2EE) and .Net.

The Java application server vendors, however, may face tough times in the second half of the year. Most Meta Group clients have purchased high-level versions of their application servers, giving them the rights to develop full Enterprise JavaBeans (EJB) applications. Few, however, have actually done any EJB development. Almost all development so far has been on the level of "servlets" and Java Server Pages, which would be covered by less expensive, midrange application server licenses.

	See news story: Oracle and BEA josh at JavaOne

These enterprise customers will not be purchasing additional copies of the more expensive application server versions until they have developed applications that require them. Therefore, the vendors may face a significant decrease in income from sales of application server licenses.

Iona has undercut all the other vendors in pricing its competitive application server. This signals the start of a price war, as Java vendors scramble for business, driving much of the profit out of a market that is starting to stall (temporarily).

Organizations should use this split among the Java app server vendors as a club in negotiations. Both Oracle and Iona have lower prices on their application servers than IBM and BEA. Negotiators should bring those lower-priced vendors into negotiations to put strong pricing pressure on the two leaders.

Users, however, should also be careful about making major commitments to second-tier Java vendors that may not survive in the long term, particularly as the market for tools swings to the large vendors. IBM and BEA, which are the clear leaders in application server sales, are the most likely survivors. Oracle also has the staying power to guarantee long-term support for its application server. Borland and Iona will fill in the gaps and provide some best-of-breed tools.

Meta Group analysts David Cearley, Dale Kutnick, Daniel Sholler, Thomas Murphy, Val Sribar, Jack Gold and William Zachmann contributed to this article.

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