Borland Changes Course, Plans to Abandon Development Tools

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February 13, 2006 (Computerworld) -- Borland Software Corp.'s plan to abandon the development tool business to focus on its application life-cycle management (ALM) products found support among some users that are looking to manage software development as a process.
Borland outlined its latest strategy last week when it disclosed plans to divest its integrated development environment (IDE) business and acquire Lexington, Mass.-based Segue Software Inc. for $100 million. Segue sells software quality assurance and testing tools that Borland will add to its ALM offerings.
The strategy shift comes about five years after the development tool pioneer retook the Borland name following a failed two-year effort to broaden its product portfolio as Inprise Corp.
Borland officials said they have already discussed the sale of the development tools -- Delphi, C++Builder, C#Builder and JBuilder -- with potential buyers and expect to complete the process over the next two quarters. Borland has retained New York-based Bear, Stearns & Co. to manage the sales process.
Target Companies
Borland's ALM strategy targets companies like Knoxville, Tenn.-based retailer Jewelry Television (JTV), which is already relying heavily on Segue's quality assurance and testing products in a new project to replace 98% of its enterprise software with Web services.
The project, which calls for JTV to replace homegrown supply chain software with Web services by September, is in the requirements-gathering phase, said Chris Meystrik, vice president of software engineering at the company.
"We will have no more [enterprise] applications in our company, period," he said.
The company has been evaluating Borland tools for the project, but no purchase decision has been made, he said.
Adina Kram, a release coordinator at Los Angeles-based Thomson Elite, uses Borland's StarTeam change and configuration management tool and hopes the company's new focus will lead to more tools to help manage Thomson's processes.
"Process improvement breeds more process improvement, and the more a tool can do to facilitate that, the better off the development organization is," she said.
Tod Nielsen, Borland's president and CEO, said the move to divest the IDE business will allow the company to focus on the "next major wave of opportunity" in software development -- the transition from a series of isolated activities to a managed process.
"Borland is spread too thin across a diverse product portfolio, which has negatively impacted our best efforts to execute across ALM," he said.
Melinda Ballou, an analyst at IDC in Framingham, Mass., said the Segue acquisition helps fill out Borland's ALM portfolio of products by adding testing and the process for quality assurance and optimization.
"They have the right vision -- execution is going to be a tough one," she said, noting that competition includes IBM, CAInc., Mercury Interactive Corp. and Compuware Corp.

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