TIBCO Leaps Ahead in CEP with Insightful Acquisition

TIBCO Software shows, yet again, why the team in Palo Alto far outpaces the rest of the field with their announced acquisition of Insightful.  

Everyone who follows The CEP Blog and my vision for the business use of CEP understands how much energy and passion I have put into explaining why the crude time-series analysis of streaming data cannot possibly solve the vast majority of complex business problems CEP must address. 

TIBCO’s acquisition of Insightful shows just how serious TIBCO is about working to make the vision of “Predictive Business” a reality.    TIBCO means business, and a large part of what that means is helping customers solve their most challenging business integration problems, which can be summarized in CEP-speak as detecting opportunities and threats, in near real-time, as a core corporate competency. 

If you spend a few moments on the Insightful web site, you will find a treasure of documentation that discusses a gold mine of advanced statistical analytics that can be used in a number of mission critical applications.

This is the class of analytics that form the backbone of complex event processing.  In fact, as I have often pointed out (to the dismay of some of my CEP colleagues), any software company that discusses CEP and does not support or advocate advanced analytics are selling snake oil.      TIBCO obviously understands the difference between snake oil, smoke-and-mirrors marketing, and the technology it takes to solve real operational problems.

My hats off and warm congratulations to the team in Palo Alto for demonstrating, yet again, why TIBCO is committed to solving real customer problems with realistic solutions.

Maybe TIBCO will evolve to mean “The Insightful Business Company”   versus the tired and stale “The Information Bus Company” of yesteryears?

Disclaimer:  I have not been an employee of TIBCO for over a year. 

Capital Market CEP Fantasy Land

In Tech Spending Hit by Subprime Mess, Jeffery Schwartz says,

“According to Tabb, spending on development is being refocused on projects that can help firms improve their margins and, not surprisingly, do a better job at risk management. As such, investments in capabilities such as algorithmic trading and complex event processing (CEP) are likely to be pivotal in some firms’ efforts to become more competitive and improve their efforts at mitigating risks.”

“But for some banks that have deployed such technologies — the now-defunct Bear Stearns, Lehman Brothers, Citigroup and Merrill Lynch — the question is: How did these companies fail to mitigate the risks that have slammed their businesses if their development teams were developing and deploying sophisticated systems?

“There is definitely an awareness that perhaps the systems that existed in place to assess the value of portfolios or judge risk [are being scrutinized],” said Stevan Vidich, an industry architect in Microsoft’s financial services group. “

He added that there is strong interest in CEP and other risk management methodologies. A growing number of shops have started deploying such solutions based on the .NET Framework, Vidich said, and he believes such investments will continue.

“Clearly, there’s a lot of need to deal with the immense influx of data and being able to analyze data in a timely manner,” Vidich said. “It also drives need for systems like business intelligence, or BI, applied to a near-real-time scenario, which is a very attractive proposition.”

What are these guys on Wall Street smoking? 

This is the precise “over hyping” problem I have warned about repeatedly.   Folks selling rule engines that perform basic calculations over a time window of streaming data have been marketing their wares as “superbrains” that can solve very complicated problems and, at the same time, save Wall Street and The Planet.

Let me be perfectly clear here Wall Street.  Listen very carefully.

There is nothing in any of the so called CEP products in the market place that is going to stop losses related to the subprime meltdown effecting the “now-defunct Bear Stearns, Lehman Brothers, Citigroup and Merrill Lynch,” as Jeffery Schwartz implies.

To imply that the risk management (and corporate governance) required to mitigate the current crisis on Wall Street can be foreseen, solved, or even mitigated, by a rules engine (or any software) is complete and absolute fantasy.   

I think the fever created by the subprime flu is putting folks on Wall Street, or at least the vendors and the analysts pandering to them, in a Capital Market CEP Fantasy Land.

 

The Predictive Battlespace

Friend and colleague Don Adams, CTO World Wide Public Sector, TIBCO Software, explains how CEP can be used to sense, adapt and respond to complex situations in The “Predictive” Battlespace: Leveraging the Power of Event-Driven Architecture in Defense. 

Update on the LinkedIn CEP Users Group

There are now 234 members of the CEP Users Group on LinkedIn.  So, if you have not yet joined the CEP Users Group, please do so by clicking here.

Epilogue on CEP Maturity

In On the Maturity of Complex Event Processing, the author concludes:

“I think [… the. …] comment at the end of [… the. …] post “we shouldn’t feel compelled to thwart that growth with a claim that the products are not ‘mature’ when they actually are in a lot of ways” is quite revealing. The fact that such a level of debate about CEP’s maturity is taking place, and the fact that [… someone …] is concerned that the debate might stifle growth, is itself indicative of an immature market segment in my opinion.”

This quote is compelling.  When vendors disagree with the direction and tone a debate is going and they call to end the debate, labelling the discussion “a distraction” – it tends to prove the premise of the original post Deciphering the Myths Around Complex Event Processing  by Ivy Schmerken;  the CEP market, both exciting and promising, is today, mostly immature and brittle. 

For more conclusive evidence, I turn our readers attention to this post, An Overture to the 2007 CEP Blog Awards,  That analysis was based, in part, on CEP/EP Reference Customers 2005-2007 where we documented 18 public “CEP reference clients” in 2007 (25 for the entire period 2005 – 2007).

Twenty five public reference clients over a three year period with 18 last year (2007) do not demonstrate a mature market or technology domain.

————————

Footnote:

Here were the results of the CEP/EP Reference Customers Survey for 2005-2007:

Apama	5
TIBCO	5
StreamBase	4
AptSoft  (purchased by IBM)	4
Coral8	2
Aleri	2
Agent Logic	1
BEA	1
Total CEP/EP Reference Customers (2005-2007)	25

~~~

Looking only at 2007, the total CEP/EP reference customers available in the public domain were as follows:

~~~

Apama	4
StreamBase	4
TIBCO	2
AptSoft (purchased by IBM)	2
Coral8	2
Aleri	2
Agent Logic	1
BEA	1
Total CEP/EP Reference Customers (2007)	18

On CEP Maturity and the Gartner Hype Cycle

In reply to Mark Palmer’s rebuttal, What Does it Mean to be Mature?, the figure below illustrates the popular Gartner Hype Cycle.  You can click on the illustration to get a clearer image.

In context to the Gartner Hype Cycle, CEP is closer to the “Technology Trigger” phase than anywhere else in the hype cycle.  CEP has not yet reached the “Peak of Inflated Expectations”, but is inching closer and closer.

In addition, as a correlating reference point, if you look at a recent Gartner Hype Cycle that covers EDA, for example, you will find that EDA  (Event Driven Architecture) is at a similar phase, the “Technology Trigger” phase. 

On the Maturity of CEP

Deciphering the Myths Around Complex Event Processing  by Ivy Schmerken stimulated a recent flurry of blog posts about the maturity of CEP, including; Mark Palmer’s CEP Myths: Mature or Not? and Opher Etzion’s On Maturity.

I agree with Ivy.  CEP is not yet a mature technology by any stretch of the imagination.  In fact, I agree with all three of Ivy’s main points about CEP.

In 1998 David C. Luckham and Brian Frasca published a paper, Complex Event Processing in Distributed Systems on a new technology called complex event processing, or CEP (Postscript Version).  In that seminal paper on CEP, the authors said, precisely:

“Complex event processing is a new technology for extracting information from message-based systems.”

Ten years later there are niche players, mostly self-proclaimed CEP vendors,  whom do very little in the way of extracting critical, undiscovered, information from message-based, or event-based, systems.  

A handful of these niche players have informally redefined CEP as “performing low latency calculations across streaming market data.”  The calculations they perform are still relatively straight forward and they focus on how to promote white-box algo trading with commercial-off-the-shelf (COTS) software.  In this domain, we might be better off not using the term CEP at all, as this appears to be simply a type of new-fangled COTS algo trading engine.

The real domain of CEP, we thought, was in detecting complex events, sometime referred to as situations, from your digital event-driven infrastructure – the “event soup” for a lack of a better term.    In this domain, CEP, as COTS software, is still relatively immature and the current self-styled COTS CEP software on the market today is not yet tooled to perform complex situational analysis.

This perspective naturally leads to more energy flowing in-and-around the blogosphere, as folks “dumb down” CEP to be redefined as it benefits their marketing strategy, causing more confusion with customers who want CEP capabilties that have zero to do with low latency, high throughput algo trading, streaming market data processing, which maybe we should call “Capital Market Event Stream Processing” or CESP – but wait we don’t really need more acronyms!

Hold on just a minute!  Wasn’t it just a short couple of years ago that folks were arguing that, in capital markets, it was really ESP, not CEP, remember?  Now folks are saying that it is really CEP and that CEP is mature?   

CEP is mature?  CEP is really not ESP?  CEP is really event-driven SOA?  CEP is really real-time BI?  CEP is really low latency, high throughput, white-box COTs algo trading?  CEP is really not a type of BPM?  CEP is not really for detecting complex events?   Complex does not really  mean complex? 

Come on guys, give us a break! 

(Anyway, no one is going to give us a break….  so stay tuned!)