Market

Market

It will be helpful to take a high-level overview of the Web services timeline and put the various standards initiatives and vendor product announcements into some form of historical perspective. The Web services arena is obviously a still-emerging area, in the pioneer and early adopter stage for business decision makers, that is continuing to unfold. A look back over the past couple of years can help to illustrate where the industry has come from, where it is today, and where it is heading. From this brief historical perspective, we can better understand how the new value chain is being assembled and how each of the major players and new entrants fits into it.

Web Services Evolution

The evolution to Web services from other computing paradigms, integration approaches, and standards such as electronic data interchange, enterprise application integration, distributed object computing, and Internet protocols has been frequently told. Instead, we'll start our story with a discussion of the initial drivers for Web services and then look at more recent history focusing on actual Web services standards and applications.

Drivers for Adoption

The driving force for the enterprise IT department to consider Web services has been the increasing complexity of the IT environment, the decrease in human and capital resources available per initiative, and the increasing focus on integration both within and outside the corporate firewall. IT departments have sought less costly approaches for application integration due to the heavy price tag typically associated with these efforts. Typical integration efforts attempting to link disparate computer systems take months or years, require a vast number of developers, and incur large costs due to the software licenses required and the time spent on integration and testing. Additionally, even when these integration initiatives have been completed, the business processes may have changed and the technical integration solutions can often be too inflexible to support these changes in business requirements.

On the business side, the enterprise has provided other drivers for Web services adoption, which include the search for new sources of revenue, new forms of business agility, competitive advantage, and the ongoing migration towards the virtual enterprise. The Internet and the World Wide Web helped the business take its first steps in migrating to a virtual enterprise, exposing business services as software, but the linkages were content-based rather than application-based. The Web enabled the virtualization of content, but linkages at the business application level were still hard to implement. Web services promise to extend the Internet functionality to support the virtual enterprise at both the content level and the application level, enabling virtual business processes to occur seamlessly and dynamically across organizational boundaries.

On the supply side of the equation within the software industry, the movement toward network-centric computing with open standards and Internet-oriented applications has served as an enabler for Web services to mature and to provide a new solution for these application integration challenges. Other drivers for Web services have included the software as a service movement within the software industry and its search for new pricing models which can yield ongoing subscription revenues instead of one-time license fees. In this way, drivers for the adoption of Web services have come from both the demand side of the equation and the supply side of the equation; both groups stand to extract value as Web services mature. Figure 2-1 illustrates some of these key drivers for the adoption of Web services.

Figure 2-1. Drivers for Adoption of Web Services.

Recent History

The year 2000 and beyond are important periods in the evolution of Web services. In 2000, the three cornerstone standards behind Web services were first proposed: SOAP, UDDI, and WSDL.

SOAP was first released by Microsoft in September 1999. It basically lets one application invoke a remote procedure call on another application and provides a way to pass objects embedded in XML messages between applications. SOAP can be considered the mechanism by which software components, distributed across a network such as the Internet, are able to talk with one another in a loosely coupled manner. This "loose coupling" allows software components, written in different programming languages and running on different operating systems, to interact over a variety of network protocols and to hide the specifics of their internal applications and systems. Previous forms of software component interaction, such as the Common Object Request Broker Architecture (CORBA) from the Object Management Group (OMG) and the Distributed Component Object Model (DCOM) from Microsoft, were tightly coupled and required extensive knowledge of the structure of their interaction and the same, or compatible, systems on both sides.

The major landmark for the SOAP standard was the release of version 1.1 in May 2000 with involvement from IBM and Microsoft. Version 1.1 supported a larger number of transport protocols for carrying SOAP documents than the initial version 1.0, which relied purely on Hypertext Transfer Protocol (HTTP), the communications protocol for Web servers on the Internet. Due to its early start, SOAP is currently one of the more robust, usable standards of the three major Web services standards. Support for SOAP interactions is incorporated into many hundreds of software vendors' products.

The next Web services initiative and standard to gain attention was UDDI. This cross-industry initiative was initially introduced by Ariba, IBM, and Microsoft in mid-2000. UDDI enables a business to describe its business and its services, discover other businesses that offer desired services, and integrate with these other businesses. The public beta UDDI Business Registry went live in November 2000.

The third Web services standard, WSDL, was released in October 2000. It was introduced by the same three companies who helped create the UDDI initiative: Ariba, IBM, and Microsoft. WSDL incorporated some earlier standards from IBM and Microsoft and provided a way for companies to describe and discover Web services located in UDDI registries.

In 2001, there was a flurry of activity in the Web services arena in terms of continued standards enhancements and the major vendors bringing Web services technology to market in the form of development tools, application servers, and public consumer-oriented Web services. October 2001 saw the announcement of the ONE initiative. This was Sun's "vision, architecture, platform, and expertise for building and deploying Services on Demand." Early 2002 saw the launch of Microsoft's Visual Studio.NET for Web services-based Internet application development, and the announcement of the WS-I.

Microsoft .NET My Services

Microsoft's .NET My Services has consumer services exposed on the Internet for users to manage their profile, contacts, location, alerts, presence, inbox, calendar, documents, application settings, favorite Web sites, wallet, device, services, lists, and categories. It serves as a network-centric service and information repository for frequent consumer tasks and activities. Information can be shared across a variety of "endpoints" such as applications, devices, and services regardless of the technical platform of that endpoint in terms of operating system, object model, programming language, or network provider. Additionally, developers can leverage these Web services when building their own higher level Web services applications that need to incorporate this type of functionality. They can also create and expose their own .Net My Services-compatible services.

The business problem that all this solves is that it helps to create one place for user information to be stored and managed and to make it accessible for all other applications, devices, and individuals to access based upon their access privileges. It helps to eliminate all the silos of functionality and data across the Internet. The major issue involved in these types of consumer-oriented services is a trust issue about the privacy of information and which companies or organizations should be able to serve as the repository.

Table 2-1 shows the Web services timeline for the past couple of years, highlighting events in the standards, development tools, and platforms arena. The number of acronyms in this Web services evolution may seem daunting, but the main take-away for the business reader is that with standards and tools in place, and with major vendors driving the industry forwards, the groundwork has been set for true business value to be extracted from Web services as a critical enabling technology.

Table 2-1. Web Services Timeline: Standards, Development Tools, and Platforms.
Date	Event	Companies
September 1999	SOAP v1.0	Microsoft
May 2000	SOAP v1.1	IBM, Microsoft
July 2000	.NET	Microsoft
Mid-2000	UDDI	Ariba, IBM, Microsoft
October 2000	WSDL	Ariba, IBM, Microsoft
November 2000	Beta UDDI Business Registry Live	UDDI.org
December 2000	Oracle 9i Dynamic Services and Dev. Kit	Oracle
March 2001	WebSphere Technology for Developers	IBM
March 2001	"HailStorm"	Microsoft
May 2001	UDDI Registries Live	UDDI.org
June 2001	UDDI v2	UDDI.org
June 2001	WebSphere Application Server v4	IBM
June 2001	Oracle 9i Application Server	Oracle
October 2001	Sun Open Net Environment (ONE)	Sun
October 2001	Preview .NET Alerts	Microsoft
October 2001	Global XML Web Services Architecture	Microsoft
October 2001	WS-Inspection	IBM and Microsoft
December 2001	Oracle 9i Jdeveloper	Oracle
December 2001	Orbix E2A Web Services Platform	Iona
February 2002	Visual Studio .NET	Microsoft
February 2002	Web Services Interoperability Organization (WS-I)	BEA, HP, IBM, Intel, Microsoft, Oracle, SAP, and others

Web Services Value Chain

These standards and product activities, as well as many other activities, during the past couple of years, have helped to rally the software industry around Web services and to encourage existing software players, as well as new entrants, to think about how Web services will impact their products in the future. Many vendors have incorporated support into their products and some have refocused their solutions to aim squarely at the space.

A high-level value chain for Web services is shown in Figure 2-2. The major sections of the value chain are comprised of infrastructure services, platform services, registry services, aggregation and portal services, and business services. This is somewhat similar to the traditional e-business value chain with a few exceptions such as registry services. The main difference is that all of these functions within the value chain are now moved to the network and exposed as a service using open Web services standards and common Internet protocols. For example, within infrastructure management, functions such as asset and configuration management are exposed as services for IT staff to access over the Internet with "software-as-a-service" pricing models instead of typical one-time license fees.

Figure 2-2. High-Level Web Services Value Chain.

Infrastructure services help provide the functionality for Web services infrastructure management and monitoring in terms of elements such as security and control, asset and configuration management, availability and scalability, and performance and fault management. These tools will include extensive capabilities for reporting and analysis of ongoing transactions, often on a real-time basis. An example is mFormation Technologies, which provides wireless infrastructure management software. Most infrastructure services can be considered applications aimed at the IT department to help it monitor and manage its ongoing Web services operations, both internal and external. Since Web services are oriented primarily toward machine-to-machine interaction, it is critical to monitor and manage these processes in order to ensure that they operate to the required service levels from both an IT and a business process perspective. This can help to ensure that not only is the technical infrastructure performing as required, but also that the business processes are performing as required. As we shall see in the section on business process management, monitoring of business process performance is just as critical, if not more so, than traditional IT monitoring. Another example of a vendor in the infrastructure services portion of the Web services value chain is Grand Central Communications. The company provides a shared network infrastructure sold as a subscription service. The infrastructure provides process orchestration capabilities in a shared context for business-to-business interactions in addition to underlying data and communications capabilities.

Platform services help provide the development and deployment environment for Web services in terms of messaging, interaction control, and application processing. Messaging may include parsing, transforming, and forwarding messages. As business partners interact, the data needs to be parsed, or checked, for validity, transformed into appropriate structures for internal or external applications, and routed to the appropriate servers. This function is similar to traditional B2B integration server functionality but is enhanced via support for Web services standards. Interaction control deals with business-level activities such as XML envelope processing, message validation, and conversation management. Application processing deals with workflow and integration into back-end systems. The platform provider may also offer commerce services for payload delivery, event capture, provisioning and billing, and collaborative services where human interaction is required, such as customer care. In this section of the value chain, we can include major vendors such as HP, IBM, Microsoft, Oracle, and Sun, in addition to newer entrants such as Bowstreet and Cape Clear. All provide development environments for the creation of Web services-enabled software.

Registry services provide the public and private registries, or databases, for Web service interfaces to be registered, published, and searched. This is where registries such as the UDDI Business Registries fit into the model. An example is Hewlett-Packard, which provides registry services and related software products for browsing and publishing Web services components.

Aggregation and portal services allow service providers to add value by aggregating the Web services components of others and to create composite Web services applications. Additionally, within this section of the value chain, content providers may offer content or information as a service offering, either machine readable or human readable. This part of the value chain strikes at an interesting intersection between Web services and portal software. It is easy to understand why portal software vendors have modified their platforms to support Web services and why Web services vendors are often in head-to-head competition with portal vendors. Both Web services and portal software can aggregate software components to create composite, higher value business applications.

Business services are comprised of consumer-oriented and business-oriented application services. These may be applications such as .NET My Alerts from Microsoft, or their broader .NET My Services offering that was formerly known as "Hailstorm." The application services may be specific to industry verticals or may be functional areas within customer relationship management, enterprise resource planning, or supply chain management that may be offered across numerous industry verticals. This section of the value chain is the final layer in providing an end-to-end solution. It may also be developed in house by enterprise developers.

Looking Forward

If we look at the current state of the industry, we find that most vendors are currently concentrated on the infrastructure end of the value chain; in most cases, this area has to be well-developed before the other higher level services can be provided. Also, not all elements within the value chain are required in all circumstances. For example, in a business-to-business scenario, two companies may decide to interact via Web services using some of the core standards but without the involvement of a UDDI registry or any form of Web service aggregation from a third party. Aggregation of Web services and the utilization of the registry are optional elements in the value chain based upon business objectives.

There are still gaps and white spaces to be filled within the overall value chain for Web services, but the basic infrastructure in terms of low-level standards and application development tools and platforms has progressed well over the past couple of years. This has set the stage for Web services technology to have a major impact both as a technology enabler and a business enabler. It has the potential not only to reshape business processes but to reshape entire industries one of the few emerging technologies that is truly worthy of the term "disruptive."

Vendor Profiles

Web Services Example

Bowstreet

www.bowstreet.com

Bowstreet is a privately held software company based in Portsmouth, New Hampshire. Founded in January 1998, the company focuses on automating Web application development and Web services and has over $140 million in investment from a long list of corporate and venture capital investors, including AIG, America Online, BankBoston Robertson Stephens, Chase H&Q, Charles River Ventures, Credit Suisse First Boston, Dain Rauscher Wessels, Dell Computer Corporation, GE Equity, Goldman Sachs, Kleiner Perkins Caufield & Byers, Morgan Stanley Dean Witter, Novell, Oracle, and many others.

The company's flagship product is called Bowstreet Factory 5. This is a framework for rapidly automating the creation and maintenance of flexible Web applications.

The Bowstreet Factory 5 is a Java-based development environment that consists of three major components:

Designer

A tool used by developers to create models containing a sequence of Builders and to create and modify profile sets.

Customizer

Models that enable nontechnical users to create, modify, and manage Web applications based on profiles.

Automation Engine

A run-time mechanism that can create thousands of unique, just-in-time dynamic Web applications.

Bowstreet offers an open, vendor-neutral solution designed to allow companies to leverage existing software infrastructures and emerging Web services. Factory 5 plugs into existing development environments and runs on common deployment architectures such as BEA WebLogic Server , IBM WebSphere Application Server, Sun ONE Application Server, and Apache Tomcat.

Bowstreet's client list includes large enterprises such as Cisco, DuPont, GM, John Crane, Northwestern Mutual, Sabre, State Street, and Sun.