Mercury and NetIQ take the next step

By Denise Dubie, NetworkWorld.com, 09/29/03

When I grow up ...

... I want to play with the big boys.

That was the mantra I heard all last week at work and at home. And perhaps my weekend with my athletically ambitious 3-year-old nephew helped shape this analogy, but recent announcements coming out of management software vendors sound a lot like the little kids gearing up to take on their older and bigger counterparts.

Last week I spoke with Mercury Interactive about additions to its software portfolio that industry watchers say will rival products from established management vendors such as BMC, Computer Associates, HP and IBM Tivoli. Mercury itself became established as a network testing and tuning vendor, but in the past 18 months or so, the company has expanded its offerings to include application management, service - level tracking and business process alignment.

"Right now Mercury is a tier two management player, but I think next year they will definitely move into the tier one range," says Zeus Kerravala, a Yankee Group analyst. The company reported revenue around $121 million in 1998 and this year they are expected to cash out at upwards of $500 million. He says their recent acquisitions and new technology that provides links between application performance and business processes will help vault them ahead of some management stalwarts.

" A ligning business processes with IT infrastructure and application performance is something almost every enterprise company will have to do down the line," Kerravala says. "Mercury's big payday is yet to come."

NetIQ is also looking to grow beyond its Microsoft roots. The leader in Windows systems management is working toward adding more Unix and Linux platform support across its product lines. The company says its systems management products will rival those from the aforementioned Mercury, BMC and Microsoft itself -- when Microsoft begins to offer more tools to manage its own apps.

"Any expansion and distancing from Microsoft is a good move for NetIQ," Kerravala says. "Microsoft may be at an all-time high in terms of user dissatisfaction."

Read more about Mercury's new products here and NetIQ's multi-platform support here.

What is your take on smaller and younger management companies breaking into the big boys' club? Is it time for a market shuffle of sorts? Let me know at ddubie@nww.com.

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