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Progress plans to jettison middleware offerings, focus on OpenEdge

UPDATED – Long-time SOA player Progress Software disclosed plans today to divest important SOA and BPM holdings. In a prepared statement, the company said going forward it would focus on “core” OpenEdge product development and the new Application Platform-as-a-Service cloud computing market. It hopes to divest “non-core” business holdings and products including Actional SOA governance tools, Sonic and FuseSource ESBs, ObjectStore object databases, Savvion business modeling tools, and others by the middle to end of its FY 2013.

The move appears to be a return to its original roots, represented by its OpenEdge line. That operation is largely a channel business in which VARs and ISVs work with Progress platforms and tools to target specific vertical markets. That business, IT work formerly hosted in house, may be overtaken by cloud computing architectures, industry observers suggest.

In the early 2000s, Progress began to expand its software portfolio. It started a buying spree, eventually acquiring a series of best-of-breed software startups, including several SOA and XML specialists, with the intention to both enhance its OpenEdge line and sell point tools directly to enterprise software shops. The company included its Apama complex-event processing (CEP) products, which have found use in financial markets, as part of its core listing.  In today’s announcement, the company said that FY 2011 revenue for core products was $361 million, while non-core products represented $172 million.

The future course for Progress Software had been under review by its board since at least shortly before its Progress Revolution user conference last fall. At that time CEO Rick Reidy announced he would be stepping down. Late last year, Jay Bhatt, who previously headed a division of Autodesk, took over as president and CEO at Progress Software.

“It looks like Progress is set to do a 180 degree turn, and revisit its past to try and reinvent its future,” BPM expert analyst Neil Ward-Dutton wrote in a blog entry.

Ward-Dutton, principal and co-founder at MW Advisors, also voiced concern, suggesting the pipelines for the divested products could “dry up very soon indeed, as prospects focus instead on potential choices with clear futures.”

Although Ward-Dutton has concern for the company, a former employee, Danny Goodall, a founder of the Lustratus Research Limited, voiced his optimism in a blog post.

“I am pleased that Progress has looked at its DNA, mapped that to what the market needs and has tried to structure a company that can thrive in the cloud,” said Goodall. “For too long Progress forgot its core values and differentiators and instead aimed to ape other vendors.”

“Progress watched competitors in the integration space build out broad SOA portfolios and felt it should do the same,” chides Goodall. This worked for Oracle (which Goodall credits for a high-powered sales operation) but not for Progress, in Goodall’s opinion. -Jack Vaughan (Includes reporting by Ryan Punzalan)

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