Dennis – you have a very valid question.

Having worked for two market-leading management software companies over the last six years, experience has taught that even the best intentions and resource support to innovate inside of big companies can get choked. As a result, most large companies plan innovation as a decision between “build, buy or partner”, with feature extensions more common for internal development and step function improvements coming through partnering or direct acquisition.

We’ll always see innovation come from smaller focused companies that have the freedom to respond to specific market needs and create opportunities that can’t be seen in a spreadsheet. Small companies aren’t harnessed by big company constraints to innovation (roadmap bias, organizational boundaries, resource silos, financially-driven – even Wall Street led – decision making, etc.). It’s the stuff we see outlined in Clayton Christensen’s, The Innovator’s Dilemma (www.claytonchristensen.com).

In the case of network management, what used to be an overlay architecture for the WAN infrastructure and the Private Network (LAN) that were designed to provide data (IP) and voice (analog) only running over separate networks, has now evolved into “one” IP-based network architecture delivering voice, video, data applications, services, etc….each application requiring very complex technical network requirements for security and SLA’s. Strong and complete innovation into one management solution for a complex system like that is not likely.

To realize the benefits your comments are searching for, it remains the responsibility of the “framework” and management platform companies to integrate the technologies that a “buy and partner” innovation model fosters, and deliver “whole product” value to their customers, their shareholders, their partners and the future market.

They need to lead the standards and integration efforts, to make it easy for innovators to build against their platform with integrated views, workflows and data models – whatever it takes to help external innovation become successful. After all, their customers are dependent on them to lead.

Sadly, the incumbents remain held hostage by their business-unit orientations and the self-interest of the managers who are incented to optimize their product line revenues and profits. It’s why CA and BMC have long been criticized as “holding companies” and “where products go to die”, which is a shame to see given their potential to lead and dominate. It’s hard to prove to the CEO and the Board how “integration” investments generated revenue last quarter. It takes brave and focused senior leadership teams to drive for the long run profits and platform and category dominance true integration brings.

In the meantime, we’ll likely see a lot of feature overlap by point software products, especially in areas where the barriers to entry are low, as we see in pure-play management software today (proven by the length of the list in your post).

Where there is potential for disruptive changes to occur by taking a whole product view to the problem (like Riverbed merging branch office production functions), we’ll continue to see innovation and market share increases grow rapidly, while market share leader incumbents stuck in their prior points of view will remain focused on easy revenue with adjacent features, but don’t fundamentally change the approach to the problem.

For the innovators and their customers and investors, that’s good news.