Now, a top German bank has gone a step further by giving up software developed in-house to the open-source community. Joy Macknight finds out why
Technology is increasingly being seen as tool to give businesses a competitive edge. So, giving away a multi-million pound in-house software system would be madness, right?
That is exactly what investment bank Dresdner Kleinwort Wasserstein (DrKW) did last month when it released the source code to a software application it claims will answer its clients' systems integration problems. Openadaptor, part of a £5m middleware development, is available freely from the Internet to clients and competitors.
"Openadaptor is a software platform which allows for rapid business system integration with little or no custom programming," said Gary Casey, director of systems integration at DrKW - the company formed after Dresdner Bank bought the Wasserstein Perella Group. "It speeds up the process of getting our clients' systems connected with DrKW's.
"We need to reduce the cost of doing business for our clients. Integrating our systems with those of our clients is a key part of doing that, so we need to make it faster for our clients to integrate with us. Making Openadaptor open source makes it easier for our clients to use the software."
In a radical move by DrKW, the source code to Openadaptor has been released to the community and can be developed or improved through public collaboration. The source code licence is based on Linux's MIT X licence, allowing free use in any open source or restricted application.
"Our clients are sophisticated users of multiple investment banks," Casey said. "Enabling them to interact with anyone they choose, even at the so-called expense of helping our competitors, will not only increase market transparency and liquidity, it will reduce costs and increase business for all."
Laurent Lachal, senior analyst at Ovum, said there were good reasons behind DrKW's altruism.
"Many banks are taking a proactive stance towards e-commerce because they have customers who come to them and ask them to integrate two or more systems. A proactive stance will allow them to dictate integration," said Lachal.
Making in-house technology freely available could be a strong element to this strategy. Lachal also pointed out that if banks can reduce interfaces by getting companies to adopt their interfaces, it will save them money.
Java/XML-based Openadaptor links applications by automating the custom coding required for system integration.
It is different from middleware, in that a middleware product attempts to reduce links between systems by providing a common communication backbone throughout an organisation. Openadaptor de-couples the middleware product internally. It connects different systems so that they can pass information between one another.
Casey explained, "Once we had deployed the messaging middleware, we realised we needed a toolkit to allow our development teams to quickly use that middleware - ie, lowering the technical barriers to entry for the teams. During autumn 1998, there was no product we could buy to fit our needs of supplier-independence, highly reusable, and easy to use and so we started the Openadaptor development."
Businesses considering implementing Openadaptor will raise the same question - where do you go for support?
"Support is available through the Openadaptor Web community informally, like other open source projects like Apache and Jabber," said Casey.
"You can buy packaged versions of open source products such as Linux and Apache from commercial companies like RedHat and Covalent, which were set up to provide support and service levels companies may want. Our licence is such that a firm can offer similar support and services for Openadaptor."
Yet Lachal said he would remain sceptical about claims for Openadaptor until he sees the evidence. "The bank has different services and I cannot believe there is an interface to all services. I cannot believe there is a panacea to integration given away for free," he said.
Open source bank initiatives
Last September, Deutsche Bank and AlphaBox developed a portal for analysts and sales staff. Software was developed for financial services and customers. Credit Suisse also targeted investors with online banking and services so people could deal in shares and see updated information.
In February last year, Dresdner Kleinwort Benson launched a portal offering investment information and applications.