Consolidation in the nascent messaging middleware market continues as Level8 Systems Inc pays the equivalent of $7.18m in shares for Momentum Software Corp to develop end-to-end Microsoft Corp MSMQ (Falcon)-based messaging solutions. Level8, which has already built a gateway supporting connections between IBM Corp’s MQSeries and Falcon asynchronous messaging queuing services expects it will take a year to add Momentum’s own XIPC asynchronous to its FalconMQ bridge and to other middleware products and transform XIPC into a Falcon-oriented environment. It will target the combination at real-time and traditional Unix environments, which will see its MQSeries-centric focus decline in favor of XIPC. Level8 did around $1.7m in MQSeries-related sales in its most recent financial period – $60,000 on its Falcon products. It hopes to turn its MQSeries customers into XIPC users or buyers for its EventWorks middleware. Level8 says it is aiming to be the second largest messaging business after IBM and says it will be happy if it can capture 10% to 15% of the market. It says it hasn’t decided which of Momentum’s XIPC development plans it will continue with, such as incorporation of Object Management Group Corba specifications. Momentum is based in Hasbrouck Heights, New Jersey and did around $5.1m revenue in 1997 – $1.7m in its last quarter – 95% of which came from product sales to around 60 companies. It gets 575,000 shares of Level8 stock, which closed at $12.50 last Friday, plus 200,000 warrants exercisable in nine months’ time. Level8 reported fourth quarter net income of $195,511 up 53% on $127,246 last time on revenue up 107% at $6.81m over $3.28m last time. For the year net income was $1.08m compared with a loss of $2.36m which included the sale of a subsidiary.
