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March 29, 2005

Oracle identifies reasons for Oblix takeover

Oracle has started to flesh out the thinking behind its acquisition of Oblix, a nine-year veteran of the still nascent but fast-growing identity management software sector.

By CBR Staff Writer

According to Thomas Kurian, senior vice president, Oracle Server Technologies, the purchase of Oblix takes Oracle into market leadership position in the access and ID management segment, a market he claims has managed a 25% growth clip in new software license sales year on year.

It is one that is being driven by initiatives to consolidate security administration across enterprise systems, for reasons of cost and compliance, he said.

But the real draw of Oblix is to be found in plans being laid down to broaden the Oracle application security portfolio with its own identity infrastructure offering. This is expected to embrace Project Fusion, Oracle’s post-PeopleSoft enterprise applications roadmap, described by Kurian as versions of Oracle applications that will combine Oracle, PeopleSoft and JD Edwards features, and bundled it into a standards based architecture built on Java and internet standards such DHTML.

We’ll be taking some progressive steps to bring new products to market Kurian confirmed. ID management proposals need to integrate well against existing HR applications so that employees can be provisioned from within the HR system and their security privileges synchronized through single sign-on across multiple business applications.

For the many enterprises that have deployed PeopleSoft HR and Oracle Financials the introduction of Oblix will be compelling, as it gets them to the position of being able to use single sign-on or a single SSL certificate to control access to both sets of applications.

We are offering co-existence today, Kurian said. Similarly, as the identity infrastructure offering is developed, Oracle sees a position when it will be offering an ID management solution out-of-the-box. In contrast, sites running SAP applications do not at this stage have a comparable enterprise access and ID management solution. And therefore, there’s a lack of an enterprise single sign-on solution he said.

The implications for a 200-plus strong Oblix customer base, which includes the likes of British Airways, Boeing and BurgerKing, is less clear. Many will have closer relationships with their preferred consulting house or systems integration partner, than they would have had with their ID management software vendor.

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ID management schemes call for a complex mix of policies, processes and technology and adopters are looking for systems integration expertise and service provider involvement to speed time to deployment. ID schemes involve integrating a range of infrastructure domains including access control, single sign-on, user administration, database directory management, application integration and user provisioning.

Acknowledging those practicalities of ID management deployment, Oracle said that it would be pressing the flesh of some new indirect reseller partners as a result of the acquisition. Oblix has close ties with Deloitte and PwC, whereas Oracle has stronger links with CAP, Accenture, EDS and BearingPoint. These and other value-added resellers are important channels for Oracle, with indirect sales responsible for up to 48% of revenues derived from its combined middleware and applications server portfolio.

Although the market potential for ID software is huge, the market has long been made up of small, niche vendors that have now all but been bought up by the large ISVs. Another was snapped up yesterday when Computer Associates International announced it was to buy InfoSec for a system that identifies and cleans up obsolete, unused and rogue user IDs and access rights to mainframe applications.

Oblix used to compete against IBM Tivoli and CA Netegrity, and has always claimed it was the first to market with a product that combined access control and identity provisioning to create an ‘identity management’ suite. It had partnership arrangement with BMC Software. Oracle did not disclose the size of its latest acquisition. Oblix is private.

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