The move appears to be a return to its original roots, represented by its OpenEdge line. That operation is largely a channel business in which VARs and ISVs work with Progress platforms and tools to target specific vertical markets. That business, IT work formerly hosted in house, may be overtaken by cloud computing architectures, industry observers suggest.

In the early 2000s, Progress began to expand its software portfolio. It started a buying spree, eventually acquiring a series of best-of-breed software startups, including several SOA and XML specialists, with the intention to both enhance its OpenEdge line and sell point tools directly to enterprise software shops. The company included its Apama complex-event processing (CEP) products, which have found use in financial markets, as part of its core listing.  In today’s announcement, the company said that FY 2011 revenue for core products was $361 million, while non-core products represented $172 million.

The future course for Progress Software had been under review by its board since at least shortly before its Progress Revolution user conference last fall. At that time CEO Rick Reidy announced he would be stepping down. Late last year, Jay Bhatt, who previously headed a division of Autodesk, took over as president and CEO at Progress Software.

“It looks like Progress is set to do a 180 degree turn, and revisit its past to try and reinvent its future,” BPM expert analyst Neil Ward-Dutton wrote in a blog entry.

Ward-Dutton, principal and co-founder at MW Advisors, also voiced concern, suggesting the pipelines for the divested products could “dry up very soon indeed, as prospects focus instead on potential choices with clear futures.”

Although Ward-Dutton has concern for the company, a former employee, Danny Goodall, a founder of the Lustratus Research Limited, voiced his optimism in a blog post.

“I am pleased that Progress has looked at its DNA, mapped that to what the market needs and has tried to structure a company that can thrive in the cloud,” said Goodall. “For too long Progress forgot its core values and differentiators and instead aimed to ape other vendors.”

“Progress watched competitors in the integration space build out broad SOA portfolios and felt it should do the same,” chides Goodall. This worked for Oracle (which Goodall credits for a high-powered sales operation) but not for Progress, in Goodall’s opinion. -Jack Vaughan (Includes reporting by Ryan Punzalan)

Fast forward to today and the crisis on Wall Street and the plans in Washington to both rescue and better regulate the financial industry. Complex event processing (CEP) has had a lot of initial success in programs for automated stock trading where price and other events trigger buys and sells. But that was in the boom time and now we are in the bust. Wall Street is doing trades at very low volumes.

So does CEP still have a future on Wall Street?

John Bates, whose research at Cambridge University in the U.K. helped pioneer the event-driven technology, told SOA Talk this week that he sees opportunities for CEP in the new era of financial regulation.

CEP is already being used in banking to detect fraud by scanning transactions for events that indicate nefarious activities, noted Bates, who is now vice president of Apama Products, which develops CEP technology for Progress Software.

CEP can also be used for real-time market surveillance to monitor events that might indicate market manipulation and other forbidden practices, he said.

So if CEP is not already on the radar at the U.S. Treasury Department, Federal Reserve and Security and Exchange Commission, it may be soon.

Some details..

Progress acquired IONA for an aggregate purchase price of approximately $162 million and approximately $107 million net of cash and marketable securities reported on June 30, 2008, which it funded with existing cash resources.

IONA was always among the more interesting companies in the software firmament. It originally came out of computer science academic efforts in Ireland, and was one of the earliest companies to focus on distributed computing. It was one of a handful of upstarts looking to ride the CORBA ORB standard to market. Its star was Orbix.

One of its big early successes was one of technology’ biggest all-time failures. But IONA leveraged what it learned as part of Motorola Iridium Satellite communication effort. [Wikipedia tells us that the satellites and other assets and technology behind Iridium were thought to have cost on the order of $6 billion – but that the bankrupt firm later sold for a mere $25 million.]

Getting to market with an ORB was just step-one for IONA. The company rolled with the Web services and SOA trends; it managed to stay in the game after other independent ORB makers were forgotten, adjusting as market demand changed. It is possible to project that IONA will become an enduring franchise as it comes under the Progress umbrella. Before it is too late, can anyone tell us what ‘IONA’ means?

First, Progress snapped up IonaTechnologies Inc., adding Iona’s Artix ESB technology and CORBA legacy customer base. Then on Friday Progress announced that it has also purchased Mindreef Inc., the privately-held vendor of testing and service validation tools for service-oriented architecture (SOA), for an undisclosed price.

The Progress acquisition of Mindreef almost got lost in the hoopla surrounding the purchase of Iona, wrote analyst Joe McKendrick on his ZDNet blog on Thursday. He pointed out the importance of Mindreef’s philosophy of reaching out with its tools to practically everyone involved in SOA development.

“Mindreef’s emphasis has been on enabling professionals from all sides of SOA – architects, developers, and managers – to better collaborate on service design and implementation,” McKendrick wrote.

Jason Bloomberg, senior analyst, ZapThink LLC., who earlier in the week said the Iona deal made good sense for Progress, also saw value in the Mindreef acquisition.

“Both the Mindreef and IONA deals are great moves for Progress,” Bloomberg said. “Governance, quality, and management are more important to SOA success than middleware is, so it’s a great sign that they’re adding SOA quality to the mix.”

Change management is a crucial piece of SOA that appears to be missing in many vendor offerings, the ZapThink analyst noted. 

“After all, unless you enable broad-based service consumption and composition in environments of continual change, which is what SOA is all about, you can’t have effective SOA. It’s surprising that more SOA infrastructure companies haven’t made a deeper investment in SOA governance, quality, and management solutions, since they will rapidly realize that the success of their SOA initiatives depend on successfully addressing those issues.”

 This week’s acquisitions of Iona and Mindreef were a win-win for Progress in Bloomberg’s view.

“Progress is doing a great job of rounding out its SOA offerings by adding Mindreef’s SOA quality solutions to the mix,” the ZapThink analyst said.

In a statement released on Friday regarding the Mindreef acquisition, Progress said it was adding three Mindreef tools to its Actional SOA Management product line:

• SOAPscope Server
• SOAPscope Architect
• SOAPscope Developer

Progress and Mindreef are planning a Webinar in mid-July to further explain how the products will fit together, according to McKendrick.