Big four management vendors face competition from all sides

The incumbent management technology market leaders BMC, CA, HP and IBM manage to stay ahead of a pack of would-be contenders, but industry watchers argue the time might be coming in which the competition might have a shot at unseating one of the big four management vendors. 

Forrester Research recently released a pair of reports discussing the vendors most likely to upset the status quo among management software vendors BMC, CA, HP and IBM. While it is difficult to fathom multibillion-dollar companies like HP and IBM losing ground in one of the many markets they dominate, BMC and CA are considerably smaller companies that represent an attractive acquisition target for large vendors hoping to establish themselves as management technology providers.

"If you look at the market caps for HP and IBM, they are both well into the billions of dollars. They are just enormous companies, no one is going to acquire them," says Glenn O'Donnell, a senior analyst with Forrester Research who recently released a paper on "Managing the IT Management Software Portfolio." "CA and BMC are significantly smaller companies, but also companies with solid technology which makes them very appealing and not that big of a bite for the likes of Oracle or Microsoft."

O'Donnell details in the report how enterprise IT managers will have to change their approach to maximizing the use of the numerous management software applications in house, which could change if the vendor landscape alters. While in "The IT Management Software Challengers," Forrester Research analysts Jean-Pierre Garbani and Peter O'Neill discuss some of the potential competitors the big four face today.

To start, ASG worked in 2007 to expand its business service management (BSM) efforts. The company, which has been developing management software since 1986, has made inroads with mid-market that the big four haven't completely penetrated and has sustained strong financial performance. Yet the company suffers still from a lack of brand recognition and needs to incorporate application management and IT process automation into its product suite,

Microsoft, for its part, is a worldwide market leader in many areas and the company continues to focus on the management of Windows-centric data centers. But with the release of Hyper-V and other virtualization products, Microsoft has vowed to become vendor-agnostic in its management capabilities. While Microsoft could prove a competitor via acquisition, Forrester analysts say its current offerings keep it in an operating system management niche.

NetIQ (an Attachmate business) is next on the list of potential contenders, according to Forrester Research. The company sells it software on the basis that it will integrate and leverage a customer's existing investment. Another positive is NetIQ's recent foray into the IT process automation market. Still, Forrester lists NetIQ's sales force among its weaknesses, saying they are too focused on existing customers to really challenge the incumbent vendors.

Denise Dubie is senior editor with Network World.