The New CA Technologies: Not Your Old Computer Associates

Written by The VAR Guy 1
July 29, 2011

It took a few years, but The VAR Guy finally believes CA Technologies (formerly Computer Associates) really has changed its stripes and reinvented its business. The latest evidence involves CA’s buyout of WatchMouse, which develops a SaaS platform that lets customers and partners monitor cloud service level agreements. But there’s a bigger story here. A much bigger one. CA finally seems to be focused on growing channel opportunities — including cloud and managed services opportunities — rather than legacy software maintenance opportunities.

First, the micro news: CA is buying WatchMouse, which offers a global SaaS service for customers and channel partners. WatchMouse’s SaaS platform will integrate with CA’s Nimsoft division (managed services software) and CA’s Application Performance Management (APM) group. Bottom line: It sounds like WatchMouse could help VARs and MSPs to hold cloud service providers (CSPs) accountable for their service level agreements (SLAs).

My, You Look Different

Now, that macro perspective: After several failed attempts, CA finally seems to have reinvented itself. The company spent the 1990s buying up mainframe and client-server software businesses. The result was a hodgepodge of legacy applications that generated plenty of cash for CA… but didn’t really position CA as a strategic market leader. In the early 2000s, CA was busy cleaning up an accounting scandal, which landed former CEO Sanjay Kumar in prison. CA also had to reinvent its direct sales business, which had a reputation for taking deals direct.

Fast forward to the present, and current management seems to be successfully reinventing CA. The VAR Guy isn’t suggesting that everything is rosy within CA’s business. There are still plenty of legacy applications — and occasional channel hiccups — that don’t exactly help partners. Plus, CA’s top-line revenues aren’t exactly growing rapidly.

But take a look at CA’s Nimsoft division, which now works with more than 400 managed services providers. The Nimsoft business has grown roughly 80 percent since CA acquired Nimsoft in early 2010, Forrester Research reported. Our sister site, MSPmentor, estimates Nimsoft’s annual revenues now exceed $50 million — which puts Nimsoft near the top of the RMM (remote monitoring and management) market, especially in the mid-market.

Of course, let’s keep that Nimsoft success in perspective. CA’s revenues were $1.163 billion in its Q1 for fiscal 2012. Quick math suggests CA will be roughly a $4 billion company during this fiscal year. So Nimsoft’s revenues are quite small compared to the larger CA. Still, those Nimsoft revenues are growing fast and pulling CA into growth markets like cloud, SaaS, service desk and managed services. WatchMouse may help to accelerate that growth.

Bottom line: The VAR Guy thinks CA’s transformation is for real.