In case that was way too complicated for you to understand, here’s my web 2.0 business plan in three easy phases:

This was pretty much the plan for everyone from Digg to FriendFeed, Twitter to Facebook.  And despite the obvious flaw of not really having a phase two, these companies still exist and are still fully operational.  Granted, several web 2.0 companies have entered the deadpool (Pownce, for example), but a lot of the ones you might have thought would be dead and out of money by now are still up and running, which is pretty darned amazing considering that they lack any publicly known business plans.

Twitter is already trying to figure out exactly what their business plan is, and in fact they’ve recently hired someone to help them figure out how they’ll make money – Twitter recently hired Kevin Thau who hails from past ventures Buzzwire and Openwave.  It’s hard to imagine what Twitter might do even just to cover what are likely to be increasingly expensive costs to run and maintain their infrastructure.

But that doesn’t explain one small, minor detail that I still can’t figure out: how is it that these companies got any VC funding without presenting any real business plans?  And furthermore, why is it that companies like Yammer, Present.ly and even IBM are taking concepts directly from Twitter and already making real money on them before Twitter ever even turns over a single dime?  I’m not criticizing these companies for creating similar functional offerings – to the contrary, the fact that they seem to have a good business a plan speaks highly of their possible futures.

Upon reflection, I think it’s probably wrong of me to include Facebook in the list of web 2.0 startups that don’t really have a solid business plan.  I do believe they had always intended to advertise to their users, and that they could do this more effectively by selling ad space on profiles that matched demographics that their marketers are after.  I had also written last month that I do believe they have enough momentum going to find a steady revenue stream before going under.

But that doesn’t explain what Twitter, Digg or FriendFeed or similar services will do if the costs of running their infrastructure outpace their funding.  They’re all great tools to share and discover content (and generate endless memes), but if push came to shove I think I could probably give up most of them and rely on Facebook to provide the same or similar functionality.

That’s enough for now.  I’d better get back to enjoying my favorite web 2.0 sites while they last.

According to the company press release:

LotusLive is designed to help companies work smarter by making it easy for them to connect and work together — with an emphasis on simplicity and ease of use. LotusLive’s online services give businesses of all sizes access to Lotus’ rich collaboration tools without requiring an up-front investment in IT support resources or infrastructure.

What’s most interesting about this news is IBM’s plans to partner with several key SaaS vendors:

• LinkedIn will provide LotusLive with searchable contact information.
• Salesforce.com will integrate LotusLive services within its CRM application.
• Skype announced plans to integrate voice and video into LotusLive.

Right now only LotusLive Meetings (Lotus Sametime) and LotusLive Events along with the hosted Notes application appear to be available for purchase, with the other solutions still showing up as being in beta.  I wasn’t able to find details on when IBM plans to make the additional functionality available.

The dashboard page for the collaboration component looks a lot like what you might expect from a "web2.0” site, and is actually pretty slick looking.

Even without the details about when it’ll be available, it’s exciting news from IBM, and it stacks up nicely against Microsoft and their plans for more SaaS offerings with the upcoming Office 14 release, as well as Google’s recent push to start selling Google Apps through their recently announced reseller program.

More details at LotusLive.com, full LotusLive press release at IBM.

I would say it is a bit unlikely that they decided to purchase either due to the downturn. I believe both companies would spend a long time in doing due diligence before announcing that they would be looking to acquire any company. This would mean the idea most likely would have germinated pre-financial crisis. Unless the two companies had the foresight that the rest of the world seemed to lack.

I completely agree with this.  Although I do wonder about the timing involved of the Oracle-Haley acquisition.  SAP purchased Yasu, another BRMS vendor, back in 2007, long before IBM announced its purchase of ILOG.  My suspicion is that Oracle didn’t really care until they heard about the IBM-ILOG purchase, and at that point fast-tracked a replacement for their own under-resourced BRMS offering.

They probably realized at that point that two of their products were at risk of losing a strategic advantage: their BPM offering and WebLogic.  If IBM is able to integrate ILOG into their WebSphere J2EE platform, it would strengthen both their BPM solution and their WebSphere offering.

And then there’s the whole issue of how long it’ll likely take to ever fully integrate Haley and ILOG into Oracle and IBM respectively.  Although the company entities can be integrated quickly, the work to do real software integration may take years.

Again, this is all my own personal speculation and conjecture, but I still find Oracle’s public explanation a little curious.

Back in July of 2008, IBM announced their plans to acquire ILOG.  Most of the buzz was around IBM integrating ILOG, a Java business rules engine, into their IBM WebSphere J2EE application server.  It seemed like maybe IBM’s aim was to improve their BPM offering by extending BPM with a full blown BRMS engine.  That would allow for some hyper complex routing rules in BPM, and also strengthen IBM’s position against Oracle’s recently acquired BEA WebLogic Server (now Oracle WebLogic Server).

Around October of 2008, Oracle announced that they were planning to buy Haley.  Haley was originally a small US-based BRMS vendor, but was purchased by RuleBurst, an Australian company, back in November of 2007.

Oracle has said publicly that their intentions in buying Haley were to help develop software in a highly regulated financial market, and in fact InformationWeek speculated on that idea just yesterday.  They seem to be betting on the notion that the financial markets will become more regulated to prevent the kind of credit default swap madness that we’ve been hearing about over the last few months.

But I believe the real story is a tiny bit different, and it probably goes something like this:

• Oracle has long competed against IBM and SAP as a leader in business applications – in CRM, ERP, and other middleware categories
• The BPM (business process management) market was predicted to grow between 29 to 44% through 2011, for a total market size somewhere around $4 billion USD (according to Gartner, IDC and Forrester – source)
• Oracle had acquired a ton of middleware, an additional BPM engine (Fuego, later known as AquaLogic BPM), and a robust J2EE application server – in fact they ultimately dropped their own Oracle iAS J2EE server in favor of WebLogic Server
• Oracle’s primary intention in acquiring BEA was to both have less competition in the SOA/middleware market, but also to compete more strongly against IBM with a better J2EE platform
• IBM also has a J2EE application server, perhaps arguably the only one that stands in the way of total market domination for Oracle, as well as a BPM engine
• IBM wanted a larger share of the BPM market, so they bought ILOG with that intention, but also planned to put WebSphere ahead of WebLogic Server strategically
• Oracle decided to dump their own home grown rules engine in favor of Haley

The way it all works out, though, is really rather interesting.  Both vendors are now strategically in a healthy position to react to any need for complex software that can handle new and evolving financial regulations.  And it’s a good way to explain the decision to the market, even though it seems like the Haley acquisition may have actually been more of a response to IBM than to the possibility of a heavily regulated financial market. 

It should be interesting to see how this story continues to progress.