IONA Technologies plc

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IONA Technologies plc

The IONA Building
Shelbourne Road
Ballsbridge Dublin 4
Ireland
Telephone: +353-1-637-2000
Toll Free: (800) 672-4948
Fax: +353-1-637-2888
Web site:http://www.iona.com

Public Company
Incorporated: 1991
Employees: 650
Sales: $105 million (1999)
Stock Exchanges: Irish NASDAQ
Ticker Symbol: IONA NAIC: 511210 Software Publishers

Headquartered in Dublin, Ireland, with a U.S. office in Waltham, Massachusetts, IONA Technologies plc is an established leader in providing middleware based on the CORBA (Common Object Request Broker Architecture) standard. Basically, middleware enables computers using different platforms to communicate with each other. Well-positioned as a middleware leader in e-business, IONA provides services worldwide. In response to the emerging market for enterprise portals, IONA leads the industry with the introduction of its iPortal Suite of servers and middleware for business-to-business e-commerce and enterprise portal applications.

Provider of Low-Cost Middleware: 1991-95

IONA Technologies plc was founded in 1991 in Dublin, Ireland, by Dr. Christopher Horn, Annrai O’Toole, and Dr. Sean Baker, all of whom were associated with Trinity College, Dublin. Horn was the initial developer of Orbix, IONA’s basic middleware product, and served as IONA’s president, CEO, and chairman from the beginning. From 1984 to 1994 Dr. Horn had served as a lecturer in the computer science department of Trinity College, Dublin, where he was involved in distributed computing. At the time of the company’s founding Annrai O’Toole was a research assistant in the computer science department at Trinity College, having earned his M.S. in computer science there in 1991. He would become IONA’s chief technology officer. Dr. Sean Baker held a tenured post in Trinity College’s computer science department and received his doctorate there. He would become the firm’s chief scientific officer.

Baker has written two textbooks on CORBA, a software architecture and specification that allows programs at different locations and developed by different vendors to communicate in a network through an interface broker. CORBA was initially developed by a consortium of vendors through the Object Management Group (OMG), which grew to include more than 500 member companies. CORBA was the standard on which IONA based its middleware products, which enabled companies to integrate their information systems with clients, customers, and the Internet. The OMG’s CORBA specifications were first released in 1991.

A key element of CORBA is the object request broker (ORB). In a network of clients and servers on different computers, ORB makes it possible for a client program to request services from a server program without having to understand where the server is in the distributed network or what the interface to the server program looks like. IONA’s initial product, Orbix ORB, ran on Microsoft Windows and Windows NT. It also offered support for a range of Unix platforms, including SunOS, Solaris, IRIX, and HP/UX. IONA first introduced Orbix in 1993.

In 1994 SunSoft Inc., a division of Sun Microsystems Inc., acquired a 25 percent minority interest in IONA for $600,000. SunSoft produced an ORB that only operated on Solaris and was a component of DOE (Distributed Objects Everywhere). SunSoft and IONA planned to make their ORBs interoperable. By 1994 the Object Management Group had put forth a standard for building an ORB called CORBA, but it still lacked specifications for communicating between different platforms. Orbix was compliant with version 1.1 of CORBA. At the time IONA had only 12 employees. Although its Orbix had been successfully evaluated, some larger companies remained concerned about IONA’s stability, given its small size. The investment from SunSoft gave IONA a strategic backer and added credibility to the firm.

During 1994 companies that produced ORBs were working on developing interoperability between Microsoft’s OLE (Object Linking and Embedding) object standard and CORBA. Rather than adopting CORBA, Microsoft was committed to Digital Equipment Corp.’s Common Object Model (COM) as its distributed object standard. In 1994 IONA was working on a beta version of Orbix that would allow developers to integrate Microsoft’s OLE with Unix applications. In April 1995 IONA began shipping new versions of Orbix-OLE that allowed developers to create OLE-based applications with Microsoft’s Visual Basic or Visual C + + or Powersoft Corp.’s PowerBuilder and to invoke server-based objects via CORBA. Analysts expressed hope that IONA’s Orbix-OLE would help bridge the gap that existed between OLE and CORBA. Later in 1995 IONA planned to release Orbix 2.0, which would support CORBA 2.0.

IONA was focused on its core product, Orbix, and committed to the CORBA standard. Its goal was to become a high-volume ORB producer. By mid-1995 it had more than 200 customers for its shrink-wrapped, low-cost products. In June 1995 it signed a $750,000 contract with Boeing’s Commercial Airplane Group to supply it with ORB technology. It had also signed third-party deals with companies such as Novell, Visix, Isis, and NobleNet to use its ORB products. By the end of the decade IONA would have more than 3,500 customers, a network of more than 400 system integrators and consulting organizations using its products, and strategic alliances with leading software companies.

With the release of Orbix 2.0 in fall 1995, IONA opened a U.S. office near Cambridge, Massachusetts. Orbix 2.0 enabled Microsoft’s OLE to be distributed across networks that were supported by CORBA. For example, a Microsoft Excel spreadsheet could pull data from a variety of sources as needed. For 1995 the company reported revenue of $8.6 million and net income of $2.2 million.

New Products and Strategic Alliances: 1996

Java was another programming language coming into use in the mid-1990s. In 1996 IONA introduced Orbix Java, which would allow Java applets running in a browser client to access the database and transactional services of server applications built around CORBA. Following beta testing in early 1996, Orbix Java shipped later in that year.

In 1996 IONA licensed its ORB technology to Silicon Graphics Inc. It also signed a joint development and licensing agreement with IBM to link Iona’s ORB to IBM’s Systems Object Model and Distributed Systems Object Model server technologies. By working closely with IONA, IBM could ensure tighter compatibility with ORBs from other companies.

At the Object World East Show in May 1996, IONA demonstrated OrbixTalk, which facilitated event-driven or indirect client/server communications. OrbixTalk linked ORB to a message logging system and provided guaranteed delivery of communications. Later in the year IONA announced product integrations with three other companies: Isis Distributed Systems Inc., NeXT Software Inc., and Persistence Software Inc. The technology partnership with Isis resulted in Orbix + Isis, which added fault tolerance, an important factor in the reliability of a distributed system. Chicago-based Options Clearing Corp. would base its transaction-processing framework on Orbix + Isis. The agreement with NeXT Software would result in linking Orbix with NeXT’s architecture for building distributed Web server systems. IONA’s partnership with Persistence Software would give Orbix the ability to store and access objects in a relational database.

In October 1996 IONA introduced a beta version of Orbix Web 2.0, which linked Java applets to ORBs. The company also announced it was developing a link to allow interoperability between Microsoft’s Distributed Component Object Model (COM) and CORBA. Before the end of the year IONA had separate agreements with BEA Systems Inc. and Transarc to produce transaction management systems using Orbix 2.0.

A Dominant ORB Provider for CORBA: 1997

In January 1997 IONA began shipping its Orbix/Enterprise middleware that would link ORBs and mainframe computers running on OS/390. The product was developed in conjunction with BellSouth Corp.

At Object World East, IONA demonstrated a suite of object-based tools and services for creating transaction-intensive and messaging-oriented systems. Its Orbix/Object Transaction Monitor was an integrated bundle consisting of the Orbix CORBA ORB and Transarc’s object-transaction service, CORBA naming and event services, Secure Sockets Layer security, load balancing, tuning, and database connectivity. The suite would enter beta testing in the second quarter. Also introduced at the show were Iona’s Orbix 2.2, which included a graphical user interface (GUI) for managing and monitoring applications; the Orbix Internet Inter-ORB Protocol engine; and a beta version of Orbix Trader, an object search engine that searched for objects and services across a distributed system.

Company Perspectives:

Enterprise portal technology is all about aggregating existing applications and web-enabling businesses, and IONA helps companies do just that. IONA provides industry-leading organizations around the world with complete enterprise portal solutions through the IONA iPortal suite, a comprehensive family of products; our unbiased support for diverse Internet and non-Internet technologies; and our standards-based portal assembly, configuration, and management tools.

During 1997 IONA emerged as the dominant ORB provider in the CORBA market. It had grown to about 420 employees. For 1997 the company had $48.6 million in revenue and $4.8 million in net income, compared to 1996 revenue of $21.2 million and net income of $1.5 million. Its IPO in February 1997 was the fifth largest for NASDAQ, raising some $140 million. At that time Sun Microsystems divested its 25 percent interest in the company for $60 million.

Later in 1997 IONA announced that its Orbix Wonderwall software would be integrated with Raptor System Inc.’s Eagle firewall. The firewall would allow enterprises to use CORBA-based applications over the Internet without compromising the security of their networks. The firewall would permit the secure transmission of IIOP (Internet Inter-ORB Protocol) packets across the firewall. Up to this point, traditional firewalls had not allowed the transmission of IIOP packets.

Key Agreements: 1998

In late 1997 IONA began a transition from the developer market to the enterprise market. In November 1997 it began shipping its Orbix Object Transaction Monitor (OTM), which included transaction monitoring software from technology partner Transarc. Before the year was over, IONA announced it was negotiating to license Microsoft’s COM architecture in order to create technologies that would bridge the gap between COM and CORBA and simplify distributed computing development. By February 1998 Microsoft had licensed its ActiveX core technologies to IONA. The agreement represented something of a truce between Microsoft and those who supported CORBA. It was around this time that Microsoft’s Transaction Server (MTS) was gaining momentum after notable improvements following its introduction. As a result, middleware vendors such as IONA would need to make their CORBA-compliant products interoperable with MTS. During 1998 Microsoft would participate in initiatives to bridge the gap between COM and CORBA.

In March 1998 IONA staged its IonaWorld conference in Boston. It announced an agreement with Hewlett-Packard to incorporate IONA’s ORB into HP’s Open View network management software. The company also demonstrated Orbix MX, middleware for managing multimedia data—including audio, video, data, and telephony streams—and integrating it with traditional data in an organization’s information technology (IT) infrastructure.

In an effort to portray CORBA technology as a mainstream architecture, IONA announced that Hongkong Telecom ordered 100,000 copies of Orbix Web for use in its set-top boxes. It was just one example of a large-scale system based on CORBA. Since its IPO in February 1997, IONA had progressed in its goal to become a one-stop shop for middleware infrastructure. To its core object middleware and ORBs it had added a number of services for messaging, system management, security, and transaction management.

During 1998 the company was preparing for the release of the new CORBA 3.0 protocol. IONA code-named its next-generation object transaction monitor (OTM) Art. It was expected that the new architecture would enable developers to achieve interoperability with the major competing object models: COM, CORBA, and JavaBeans. After conducting beta testing at 500 sites, IONA released Orbix COMet in July 1998. The product let Windows-based developers create applications that could run in non-Windows environments.

Also during 1998 IONA gained a foothold in the application server market by acquiring unnamed technology from Electronic Data Systems (EDS) for $5 million. The technology would be used to add a layer over the forthcoming next-generation product that was code-named Art. With companies such as IBM, Inprise, and Peerlogic introducing new ORBs, IONA was facing increased competition in its core market. IONA also announced Orbix would be coupled with Symantec Corp.’s Visual Cafe Enterprise to allow Java developers to create applications and more easily extend them across the enterprise. For

1998 IONA’s revenue nearly doubled to $83.6 million. The company reported net income of $7.7 million.

Strengthening for E-Commerce: 1999-2000

Once the Object Management Group released its new CORBA 3.0 specifications at the end of 1998, IONA introduced Orbix 3.0 in early 1999. The new release offered rapid application development capabilities, location transparency and load balancing, Internet security, and integration with applications based on Microsoft’s COM specification.

IONA moved to strengthen its support for Java-based application servers by acquiring EJBHome Ltd., a British vendor of Enterprise JavaBeans (EJB). IONA also joined Sun Microsystems’ community licensing program for Java. In early 1999 many firms were being cautious about using Java, a relatively new programming language, as the basis of their entire application. However, CORBA-based multiplatform products were beginning to lose market share to Enterprise Java. By March

1999 IONA was offering free downloads of its HomeBase Enterprise JavaBeans toolkit, which it acquired from EJBHome Ltd. The toolkit helped speed the development of EJB component-based applications. Later in 1999 IONA introduced its OrbixHome kit, a development kit designed to Generale, integrate, and manage CORBA and EJB components.

At its fall 1999 IONA World user conference in Dublin, IONA announced it would be releasing products for electronic commerce over the next 12 months. The suite of e-commerce products would be released under the name iPortal and would run on top of Orbix. The IONA iPortal Suite would consist of application, integration, and management servers and Orbix 2000. The application server in the suite was an EJB container based on Sun Microsystems’ Java 2 platform.

Key Dates:

1991:: Company is founded in Dublin, Ireland.
1993:: Company introduces its first product, Orbix ORB, an object request broker based on CORBA standards.
1997:: IONA goes public with an IPO on the NASDAQ.
2000:: Company begins shipping its iPortal Suite for business-to-business electronic commerce.

In February 2000 IONA announced it would acquire Watershed Technologies Inc., a developer of Extensible Markup Language (XML) tools and services based in Waltham, Massachusetts, for $13.2 million in cash and stock. IONA planned to incorporate Watershed’s technology into its iPortal Web Server. The first components of IONA’s iPortal Suite, which was targeted at the business-to-business e-commerce market, began shipping in March 2000, and included Orbix 2000 and the iPortal Application Server. These were followed by the iPortal Integration Server in April and the iPortal Server in June. In July the company’s iPortal Application Server received a “Best of Show” award at Application Development 2000, an industry event focused on XML- and Java-based technology and processes for building e-business applications.

In May 2000 IONA COO Barry Morris was promoted to CEO, with former CEO Chris Horn continuing as the company’s chairman and president. Morris had joined IONA in 1994 and had become COO in April 1999. He had previously worked at Digital Equipment Corp. and Lotus Development Corp.

In June IONA acquired Genesis Development Corp. of West Chester, Pennsylvania, for $24 million in cash and stock. The acquisition added 40 employees; Genesis CEO Jason Matthews became IONA’s vice president of worldwide professional services. Genesis provided XML- and Java-based e-business applications for portals and online exchanges primarily in the insurance and financial services markets.

As 2000 drew to a close, IONA was completing its transition from a traditional middleware leader to a competitor in high-level development sectors by introducing a suite of products for e-commerce and enterprise portals. While the company’s iPortal Suite was aimed at the business-to-business market, IONA planned to eventually offer products for the business-to-consumer sector. In 2000 the company was reporting record quarter-to-quarter revenue, following record 1999 revenue of $105.4 million and net income of $5.5 million. It appeared the company was successfully expanding into providing products for e-commerce while at the same time maintaining high-volume production of its core middleware products.

Principal Competitors

BEA Systems Inc.; Visigenic Software Inc.; IBM Corp.; Microsoft Corp.; Tibco Finance Technology; Horizon Technology Group PLC; Viador Inc; Hummingbird Communications Ltd.; Oracle Corp.; Sun Microsystems Inc.; Inprise Inc.