Transaction Processing: Think Big Picture

Incorporating e-commerce sites into core business systems has made transaction processing more important than ever

Companies are running more transactions than ever before. And the onslaught begins with e-commerce.

When a user makes an online purchase, the e-commerce system runs through a series of transactions, including checking for inventory and discounts, confirming the order, fulfilling the order and, finally, processing the payment. Tack on to the networking equation expanding intranets and extranets, the ability to easily add nodes, and systems inherited through mergers, and suddenly the average Fortune 1000 company is churning millions of transactions daily.

In the past year, First Union Bank recorded a whopping 15.8 billion transactions through its three data centers. That's 3,300 transactions per minute. In a single month last year, one of the bank's data centers processed 108 million transactions on its 15-year-old IBM CICS system. In the same month this year, that data center processed 171 million transactions. This rise in the number of transactions is due largely to more online banking traffic and the bank's growth through mergers and acquisitions.

"Transactions have really increased here at the bank,'' says Kelly Rhodes, the bank's assistant vice president of IT. "Any unit of work is considered a transaction to us.''

First Union's experience should serve as a wake-up call for companies that still confine their definition of transaction processing to the payment processing that accompanies a purchase over the Internet. Payment processing, despite its importance to the enterprise, is merely a subset of transaction processing.

Simply defined, transaction processing encompasses any request that requires an automated response. This includes everything from updating customer records to electronic funds transfers and issuing payroll checks.

Anne Thomas, an analyst at the Patricia Seybold Group, downplays the notion that companies are burdened by increased transactions. Thomas says transactions are more distributed today, which means the challenge is to build systems that run transactions across multiple network protocols and server operating systems, and integrate back-office apps and legacy systems. These systems must also support Java and object-oriented programming.

Market Players
Typically, companies turn to middleware from vendors like BEA Systems, IBM, Oracle and Sybase to run transaction processing systems. While IBM's CICS is the undisputed leader in the mainframe market, BEA's Tuxedo for distributed computing "is the leader off-mainframe,'' says Gartner Group analyst Yefim Natis. "BEA has at least 60 percent of the [transaction processing] market, and IBM is the nearest competitor, with 16 percent.''

Tuxedo has been around for about 10 years, and BEA continues to tweak, refine and enhance it. Most recently, the company added Java support to Tuxedo, and with a nod toward the influence of the Internet, spun off the most mature parts of Tuxedo to build a Web-oriented sibling-WebLogic.

On the mainframe side, IBM's CICS has continued to thrive, providing a reliable, flexible solution that's adapted well over the years.

For some, the mainframe still represents the most reliable platform for accommodating high transaction volumes. But established vendors shouldn't be too smug when staking their market share claims because there are any number of players jumping into transaction processing-from database vendors Oracle and Sybase to software giant Microsoft.

Analysts say even with enhanced Java support, Tuxedo is not the most exciting product on the market today.

"Tuxedo is old; it's not the latest, coolest stuff,'' says Thomas, who reserves that designation for OTM, or object transaction monitors. OTMs have emerged from a host of new players, such as Iona Technologies and Inprise Corp. BEA also is building OTMs into Tuxedo and WebLogic.

These products provide CORBA-based solutions that let programmers write apps based on reusable object-oriented components-apps that can run transactions across multiple networks. "You break an application into more discrete pieces and use a guaranteed delivery system such as [Microsoft's COM],'' explains Thomas.

Most of the major players in this space have moved toward OTM since just a transaction management solution is no longer adequate. Past solutions have been built around the database model. The application-level distribution model, based on reusable objects and presented by vendors such as BEA and Inprise, is a better fit for today's more complex transaction-intensive environment. "A single application is distributed across a number of systems,'' says Thomas. "IBM, Inprise and BEA all support that kind of distributed application. Others don't do distributed resources, they just delegate it to the database.''

The transaction methodology used by database vendors, such as Oracle and Sybase, is based on distribution at the database level and is a far cry from the distributed application model. The database model is built to run on vendor-specific homogeneous environments, which are becoming less and less the norm.

"At the database layer, you need to have a distributed transaction server that can support multiple resources,'' says Thomas. "If all resources are Oracle, you can [easily exchange data] in Oracle.'' Difficulties arise if the enterprise wants to mix environments, for instance, by using both Oracle and Sybase. "A transaction monitor does that better,'' says Thomas.

That OTM is gaining popularity underscores how enterprise networks crave a way to integrate applications and use data across multiple platforms. Increasingly, middleware products such as Tuxedo are being fine-tuned to integrate with back-office and legacy systems for seamless transaction processing and data distribution.

Integration was high on the priority list for Choice Point Inc. when it selected a transaction processing solution.

"We found that Tuxedo enabled applications to talk to services on multiple platforms,'' says Matt Eberz, vice president and chief architect at Choice Point, a database provider and a Tuxedo user.

Bob Botelle, vice president of operations at shopathome.com, an online service managed by The Signature Group, says his company is moving to a single platform to simplify operations. Instead of selecting a transaction processing solution like Tuxedo or CICS, the company outsourced operations to OrderTrust. "It's much easier to manage the flow of orders,'' he says. OrderTrust automatically updates Signature's own systems so the company will have current data on all customers and transactions. But that's not the case with many companies that choose multiple platforms.

Linux Craze
To meet the increased interest in Linux, BEA has added Linux support to both Tuxedo and WebLogic. Recently, the company put a trial version of Tuxedo on its Web site for visitors to download and the results were surprising. "In a couple of weeks, there were more than 1,600 downloads,'' says Mark Carges, vice president of advanced product development at BEA. "And Tuxedo is not typically the thing you would download from the Web.''

But Carges contends there is pent-up demand for companies that want to build mission-critical apps on top of Linux. For skeptics who believe that Linux hasn't proven itself as a stable, reliable platform for transaction processing, Thomas responds: "Tuxedo and other databases are all available for Linux, and you can build mission-critical applications on it,'' she says.

Carges adds that corporate enterprises are well-equipped to add Linux to their transaction processing operations. "A lot of people who want to use Linux now see enterprise tools and platforms can do transaction processing on Linux,'' he says.

Growing user interest in Linux aside, the Internet now has the greatest impact on transaction processing.

"The way people do business on the Internet is completely different from client/server,'' says Eberz. "If Choice Point relied on a client/server model for transaction processing over the Internet, "I might never reach my clients,'' he says. "You have to have a good architecture and good systems.''

Transaction processing vendors are scrambling to move to the Internet and Internet-based transaction processing, says Kim Shanley, chief operating officer at the Transaction Processing Council, which provides benchmarks to measure the performance of transaction processing solutions. "We're working hard on a Web benchmark,'' says Shanley. "The real future is how to put everything on the Web and make it as fast and scalable as people are used to.''

Both scalability and reliability are major concerns as the enterprise works with Java to run transactions across a Web-based network. Most agree that Java is the key to moving all sorts of business functions, including transaction processing, to the Web.

Of course, as enterprises become more concerned with integrating applications and data across multiple platforms, security concerns grow. Different platforms and legacy systems use different security models, and a transaction monitor must negotiate them all to complete transactions. BEA's Carges says point-to-point security simply doesn't cut it in the complex world of transaction processing, but rather "people need to realize that they need end-to-end security.''

While Tuxedo and CICS continue to dominate in the distributed and mainframe environments, respectively, the solution that an enterprise selects depends mostly on what it will be used for and the company's overall style and philosophy. Traditional organizations adhering to a more systematic approach don't buy just the technology, but rather the relationship with the vendor, says Gartner Group's Natis. "Another quality is the long-term viability of the vendor.''

Opportunistic companies, for example, Web start-ups that are 100 percent focused on e-commerce, tend to value immediate results. Natis says transaction processing vendors are great at either the systematic or opportunistic approach-but not both. He says a mature product like Tuxedo would appeal to systematic companies, while Bluestone might attract opportunistic companies looking for enough transaction capacity for a small scale system.

Companies looking at Web transaction processing must take a hard look at their enterprise networks and think beyond credit card payment processing. Businesses preoccupied with payment processing may really miss the boat, underestimating the number of transactions that must be processed daily. Of course, simply keeping up with an expanding e-commerce operation can be tough enough, but for companies serious about scalable Web transaction processing, it's time to take a step back and think big picture.

Teri Robinson is a writer based in New York. She can be reached at teri8994@aol.com.