Of bubbles and developers

The big events of 2005

Microsoft's talent pool prompted a fit of chair hurling range from chief executive Steve Ballmer and the very dubious launch of Microsoft's Live Software strategy positioned rather clumsily as the successor to, and logical extension of, .NET. Start-ups meanwhile turned down $40m investments from VCs for the chance of being acquired by Google or Yahoo! - the latter who seemed to get its act together and started talking about its own Google-esq plans. 2005 felt awfully like a bubble year and it was, in terms of hype. However, a real shift did take place: software paid for as service captured the imaginations of IBM, SAP and Microsoft - big platform players with tons of influence - who took steps towards this pricing metric. Meanwhile, Really Simple Syndication (RSS) made its way into enterprise software - CRM from Salesforce.com with plans by Microsoft to use RSS in its own CRM.

It's a rich man's world

If 2000 was the year of the IPO then 2005 was the year of the acquisition. Computer Associates, BEA Systems, IBM, SAP, Sun Microsystems - even Microsoft loosened its famously tight purse strings and splashed out. For small acquirees, purchase became a viable exit strategy alternative to IPOing because it sidestepped the cost of running a public company. For the big boys, acquisition either brought in new technologies they couldn't be bothered developing or unlocked new customers in a saturated market looking for growth. Licensing challenged BEA bought Plumtree for its customers while Sun acquired SeeBeyond to get a sales force actually capable of selling software. Microsoft and CA were more targeted and tapped into security while SAP went deeper into vertical markets. Of course, the year's most acquisitive company was Oracle: $20bn on 14 companies in 12 months. From the tiny - TimesTen - to the strategic - Retek - to the huge - PeopleSoft and Siebel Systems, Oracle CEO Larry Ellison spent across the board to consolidate Oracle's market position, hobble the competition and ensure Oracle eventually over takes SAP as the world's largest provider of business software.

Developers, developers, developers

Microsoft finally put a shipment date and a name on its next client operating system, Windows Vista now due at the fag end of 2006, Microsoft's most solid news came with its launch of the delayed Visual Studio 2005 Team System (VSTS) in November. VSTS promises to have greater significance than Windows Vista because of its potential for disrupting the market. VSTS is Microsoft's application lifecycle management (ALM) platform that is trying to offer the kinds of ALM tools and capabilities traditionally provided by Borland and IBM/Rational at a lower price and with easier functionality. Outside of Redmond, the word was AJAX - or Asynchronous JavaScript and XML - and LAMP - Linux, Apache, MySQL and Perl/PHP/Python. Neither offered anything new, just a handy verbal short hand to describe a frequently used set of technologies.®

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