The organizational structure is now complete and the business is off to a good start, Peter Fiore, vice president of IBM’s newly formed Information Integration Solutions division, told analysts at the first joint IBM/Ascential analyst event held in Boston earlier this week. We haven’t lost any momentum in the market as a result of the integration.
Fiore, who was formerly the president of Ascential, said the right team mix was in place, pointing out that about 400 Ascential people have been merged into IBM’s Information Management Group (formerly the DB2 tools division), which is part of IBM’s expanding Software business and accounts for 15% of IBM’s revenues and 33% of its profit. The Information Management Group also takes responsibility for the development of the DB2, WebSphere, and Rational brands.
The combined entity is an impressive force to be reckoned with in the integration space. We now have 1,500 employees of which 500 are focused on R&D, Fiore said. He added that integration has also been completed on the sales front, with Ascential’s sales force now becoming information integration software specialists. He said Ascential now brings a dedicated, front-line sales force to IBM. Previously IBM’s Information Integrator product did not have a direct sales team behind it. IBM now has a [sales] organization that’s focused on selling IIS products, covering the IBM and Ascential stacks, he said.
Ascential is also leveraging IBM vertical solutions route to market. Last year IBM reorganized itself to lead its sales efforts with vertically focused rather than horizontal products. IBM now has 48 separate vertical market solutions, which are being delivered via its Business Consulting Services organization.
Ascential’s technology is already a key part of the reference architecture for these vertical solutions, Fiore said. There are already over 480 BCS professionals embedding Ascential’s technology into IBM’s vertical solution initiatives.
Fiore said the sales engagement model that existed prior to the IBM takeover remains intact, but said IBM is now incentivized to sell Ascential products. We still have the same 2,000 sales people selling Ascential products before the April 29 merger, he said. The big difference now is that everyone gets paid on this and every division gets their due revenue quota.
In July 2004, IBM effectively eliminated commissions to its sales staff for selling Ascential’s data integration software when commissions were moved from IBM’s Software Group to the more technology-agnostic BCS division.
Fiore acknowledged some product overlaps, particularly between Ascential’s DataStage TX transactional data integration product (which is based on technology acquired from Mercator Software Inc) and the WebSphere Business Integration Message Broker (formerly called MQ Integration Broker). This shouldn’t come as a surprise. When Ascential bought Mercator in August 2003 for $106m, many in the industry thought it would position it against enterprise application giants like IBM.
Fiore said the company will continue to market and sell both products, but in such a way that removes the overlap and channel conflicts that might have existed. Both TX and Message Broker are strategic components of the IIS portfolio, he said.
