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Sybase Snaps Up Aleri To Boost Real-time Analytics, Offer Liquidity Risk Management

In a move designed to boost its real-time analytics offerings and allow it to offer turnkey solutions, such as for liquidity risk management, Sybase has acquired the assets of complex event processing (CEP) specialist Aleri, including all of its products. It has also retained key staff in the sales, engineering and marketing areas. The acquisition marks the continuing evolution of the CEP space, as it transforms from a one-time start-up culture to one where enterprise IT heavyweights increasingly compete.

“With this transaction, Sybase positions itself as a clear market leader in CEP. We have strengthened our real-time analytics platform, added liquidity risk management, and the industry leading liquidity management suite,” says Dr. Raj Nathan, SVP and CMO of Sybase.

Terms of the deal were not disclosed, although Sybase does not expect the transaction to have a material impact on 2010 financial results.

The company just announced its 2009 financials, posting revenue of $1.17 billion. The transaction brings to Sybase Aleri's complete set of CEP products, include the engine that it originally developed along with one acquired with its March 2009 acquisition of Coral8. Around that time, Sybase also licensed the Coral8 code to build a CEP add-on to its Risk Analytics Platform (RAP), adding to RAP's in-memory analytics and historical databases.

Because Sybase's CEP and Aleri's Coral8 offering are "to all intents" the same - according to director of product strategy, Neil McGovern - the company will have "two, not three" CEP engines to integrate into one. Sybase will in fact continue an integration effort begun by Aleri, to produce a single CEP platform, which is being dubbed the Sybase Streaming Platform.

As well as the CEP engines themselves, Sybase has also acquired associated adaptors and application templates. More importantly, it now also owns a number of financial markets solutions based on Aleri's CEP product, including its Liquidity Management System, Liquidity Risk Management and Market Liquidity Analysis applications, among others.

McGovern says that the acquisition more than doubles the number of financial markets firms using its analytics products, noting that it has about 40 customers for RAP. By keeping Aleri's customer-facing staff, McGovern expects to retain Aleri's customer base as well.

Sybase's move to offer complete solutions represents something of a change of philosophy since it acquired the Coral8 code, when officials said that it had no plans to move beyond the platform offering. But McGovern says that the company has since recognised the need to provide end-to-end turnkey solutions, though still in collaboration with partners and developers.

From Aleri's perspective, the acquisition allows it to offer a fuller solution stack, with functionality to complement CEP itself. The expansion of resources to develop the CEP platform was also attractive, says Jeff Wootton, who joins from Aleri as Sybase's senior director of product management.

Also a reality, says Wootton, is that as a relatively small independent software vendor, Aleri sometimes represented "vendor risk" to its financial markets customers, who balked at purchasing despite being impressed technically.

Sybase's acquisition of Aleri is a "very good sign" for the CEP space, says Mark Palmer, CEO of rival StreamBase Systems, who does not see the move as one of consolidation but suggests it demonstrates that "CEP is alive and well." Palmer adds that StreamBase had "a banner year" in 2009 and will move into positive cash flow this year.

He also says that StreamBase's independent corporate structure has not been an obstacle to winning business, pointing to the quality of its venture capital backing and its strong sales record. Indeed, with Sybase now snapping up Aleri (and Coral8's legacy) to become a key CEP vendor, StreamBase is one of the last remaining upstarts that created the CEP space a few years back.

Fellow independent Apama was acquired by Progress Software in 2005 and has slowly been integrated into that company's core middleware offerings. Meanwhile, Cicada, along with its CEP offering, was acquired by exchange group Chi-X in 2008 and CEP/data management vendor Vhayu Technologies was acquired by its major reseller, Thomson Reuters, last year. Alongside this M&A action, several IT heavyweights have entered the CEP fray.

Oracle obtained a CEP engine when it acquired BEA Systems in 2008, which it now pitches alongside its Fusion Middleware (and perhaps soon as part of an integrated Oracle/Sun stack). Also notable: Tibco Software has been developing and pushing its BusinessEvents suite; IBM has begun to roll out its System S event stream processing software; and Microsoft last year introduced its StreamInsight CEP offering as complementary to its SQL Server database. At the same time, open source CEP offerings, such as Esper, have developed in functionality and attracted interest from developers.

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