IBM spells out strategy for Informix

IBM has been putting more meat on the bones of its proposed acquisition of Informix Software.

IBM has been putting more meat on the bones of its proposed acquisition of Informix Software.

Big Blue will pay $1bn (£0.69bn) cash for all of Informix's database assets - 2,500 people, 100,000 customers and technology.

"Software is an important growth area for the IBM company," said Steve Mills, senior vice-president and group executive, IBM Software. "The adding of Informix's database business to our software data management business effectively doubles our position in the marketplace for distributed databases."

For Mills, distributed databases are those running on Unix and Windows-based systems. And IBM now believes it will be able to steal a march on rival Oracle.

"I think it [IBM] is a serious threat to Oracle," said Charlie Garry, senior program director for database research at the Meta Group. "In the long term, I think Oracle could be in trouble unless it does something about its pricing model."

IBM anticipates that the deal will be completed in the third quarter. It is also adamant that existing Informix customers will be unaffected by the purchase, and claims there will be no redundancies. The company is claiming that one of the main benefits it gets from the deal will be Informix's technical and development staff.

"IBM really only want the development assets and some of the support assets," said Garry, but he predicted 20% redundancies as a result of the takeover.

IBM's DB2 Universal Database will remain its core product. New projects being worked on at Informix will now be shelved. The companies have promised to continue supporting and updating Informix products and, as of yet, there are no plans to migrate Informix users over to IBM.

Last September, Informix announced that it was establishing a new subsidiary, Ascential Software, to deal solely with its solutions-based business. Ascential will now go it alone as an independent company, although it has signed a deal with IBM that will see the pair collaborating on the sales, marketing and development of some products.

Barbara Stanley, Northern European managing director at Informix, believes the establishment of Ascential was coincidental, although it is understood that IBM and Informix have been in talks for some months. "This obviously hasn't happened overnight," she said. "It's easy to make those judgments with hindsight [that the company planned to sell out when it formed Ascential].

"IBM has a good growth strategy that it is looking to implement as quickly as possible, and it saw that Informix could bring that to the game," said Stanley.

The deal appears to offer many synergies, but Meta's Garry was initially sceptical when he heard the news. "My first impression was 'what the hell has it [IBM] done that for?'" he said. "In some combinations there's some overlap, but in this instance it's total overlap."

Janet Perna, general manager for the IBM Data Management Software division, will head up the combined database business. The future of Informix's senior executives is unclear. "This is work in process now and we hope to retain a large part of the executive team and integrate them in to the Data Management Software division," said Perna.

IBM anticipates that the acquisition will be completed in the third quarter.

Emma Nash

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