Schwab Powers Up Java Apps

Strengthening its commitment to Java software, Charles Schwab & Co. last week said it will use BEA Systems' WebLogic Java application server and development tools to build new Internet trading systems.

With $861 billion in assets, Schwab carries considerable weight among companies that use the Internet to conduct business with their customers and partners. The company's deployment of BEA's Java technology is seen as a validation of Sun's Java 2 Enterprise Edition (J2EE) specification for component-based enterprise application development.

"Schwab is on the leading edge in terms of business utilization of the Internet, and its commitment to J2EE illustrates the standard's growing maturity," said analyst Yefim Natis of the Gartner Group.

Although Java technology isn't suitable for core transaction processing applications, such as an airline's reservation system, Schwab's endorsement illustrates that J2EE is a solid platform for both development and deployment of large Internet business applications, analysts said.

"Java's strengths are rapid object-oriented development and its ability to bind distributed component applications," said analyst Chris Dial of Forrester Research. "Its disadvantage, compared to compiled languages, is that it's still too slow for the processing required in the back end."

Tallying more than 500 WebLogic server licenses, Schwab is BEA's largest customer. As a result of last week's deal, for a one-time fee which neither company would disclose, Schwab can add as many WebLogic servers as it wants to its installed base. Schwab already plans to use the application server for a new wireless trading application, as well as for Schwab Institutional, a division that provides trading services to 6,000 independent investment advisers.

Like most Fortune 500 companies, however, Schwab doesn't commit to a single vendor's technology, due to the complexity of its IT infrastructure. Application servers are no exception: In addition to WebLogic, the company uses IBM's WebSphere, which is also J2EE-compliant. When Schwab chose in 1999 to use Java for all internal and customer application development, it decided to deploy both application servers due to their respective strengths, said Ron Lichty, vice president of Java object services.

At the time, BEA had made an early commitment to Enterprise Java Beans (EJBs), the server-side component model for development of transaction, security and database middleware components.

Meanwhile, IBM had pioneered JavaServer Pages Web site development technology, Lichty said.

As a result, Schwab chose WebLogic to build and deploy its investment management applications, which use EJB components. For its Web site, the company turned to WebSphere.

With heavyweights like Schwab betting the future of their Internet businesses on Java, the stage is set for Sun's component-based enterprise architecture to square off against Microsoft's Component Object Model (COM). Java will more often be the choice for large, Internet-based applications distributed across disparate systems, while COM will be limited to Windows environments, analysts predict.