January 5, 2005 12:40 PM PST

BEA buys Incomit to beef up telecom software

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Infrastructure software company BEA Systems said Wednesday that it has acquired Incomit, a privately held Swedish telecommunications software company, for an undisclosed sum.

BEA said that it will incorporate Incomit's development tools for building telecommunications applications into a forthcoming version of BEA's WebLogic designed for telecommunications providers. BEA's WebLogic software is used to build custom business applications and can be embedded to run in carriers' network hardware.


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The move is part of BEA's plan to grow its revenue by creating industry-specific versions of WebLogic software. Other planned products include editions for the manufacturing industry, which will be able to handle data sent from radio frequency identification tags.

BEA's strategy of tailoring its products to specific industries as a way to grow market share mirrors that of competitor IBM, which has a wide-ranging strategy to develop products, services and partnerships for about 12 industries.

The Incomit purchase is the fifth acquisition by BEA in the past two years. After one of those deals--the purchase in 2003 of a small security company called CrossLogix--BEA later introduced a security product integrated with its WebLogic software.

BEA, which has about $1 billion in annual revenue, has itself been considered a potential takeover target. The company has remained profitable despite the downturn in technology spending over the past three years. But it is facing more competition from IBM, Oracle and open-source company JBoss, and it has seen sluggish new license revenue.

Some industry analysts and former executives have urged BEA's management to be more aggressive in its acquisition strategy to help spur growth.

 

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