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Microsoft And IBM: Empire Building At ACORD LOMA Forum?

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Competition to sell technology in the insurance industry is fiercely intensifying, as more players enter the fray and the specter of recession-induced cuts in IT budgets looms on the horizon.

When considering the vendor-dominated steel cage match that the ACORD LOMA Systems Forum has become, however, it’s always a good idea to keep an eye on what the big dogs are doing.

In this case, of course, the canines we’re referring to are tech industry giants Microsoft Corporation and IBM, and surprisingly–or perhaps not so surprisingly–the longtime rivals were pretty much doing the same things at this year’s event in Las Vegas.

I say it may not be so surprising, since the last few years have demonstrated that vendor exhibitors who do best at this conference are those whose customers are other vendors. Just change the word “vendor” to “partner,” and you’ve already mastered the vocabulary that will enable you to understand the actions of the big two.

Microsoft has certainly made no secret of its strategy to leverage relationships with vendor partners to produce free beta research and development for its software products, and to support its platform. After a year of being absent from the ACORD LOMA show floor, Microsoft was back and touting the Insurance Value Chain/Partner Advisory Council, described by its chairman, Kevin Kelly, as “a stand-alone body that will provide marketing and technical feedback and interaction for Microsoft’s insurance vertical team.”

Kelly, who coincidentally was formerly global insurance industry manager for Microsoft, is now executive vice president of enterprise markets for XDimensional Technologies, Inc., Brea, Calif. He further stated that, “This will enable the partners to have a more unified voice toward Microsoft and to behave ‘in-market’ as a formal body of solutions, related to one another via the Microsoft platform.”

At the same time, Microsoft released its IVC Software Factory for ACORD Standards, a set of development tools and assets that use Microsoft’s .NET framework. According to Kelly, it is targeted at both the property-casualty and life and annuity businesses.

IBM, meanwhile, also announced “a solution for improving operational efficiency and a framework for process acceleration,” both designed to help providers handle core processes such as claims and policy processing more efficiently.

So where’s the partner connection? Further into the press announcement, we read the following: “IBM’s broad independent software vendor (ISV) ecosystem also enables leading software providers to participate in the framework.”

Two technology giants with but a single thought: Get as many vendor partners as possible to buy into your framework in this vertical, thereby increasing your leverage for generations to come.

But the similarities in strategy do not stop there.

ACORD LOMA also saw the release of the Insurity-Microsoft “Millennials in Insurance Survey 2008.” This research found that Millennials (those born between 1981 and 2000) want new and innovative technologies in the workplace. In addition, they have high expectations of how insurers will interact with them as customers, including the ability to view their accounts online, Web-based support and the ability to send instant messages to agents.

IBM, not to be outdone, did its own research, the “2008 IBM Global CEO Study,” which found, among other things, that “three quarters of CEOs view the rise of the informed and collaborative consumer positively, rather than as a threat.” That fits in nicely with Microsoft’s research, which seems to indicate that the coming generation of consumers will demand nothing less than rapid, high-tech interactions.

In a very real sense, ACORD LOMA provided the perfect stage on which both tech giants could win vendor converts to their platforms–frameworks which would then form the infrastructure needed to serve the consumers of the next generation.

It’s almost as if IBM and Microsoft had a clandestine meeting at which they planned–New World Order illuminati-style–the very future of our industry and others (they work in other verticals as well), with technology as the celestial hammer that will fashion their shared vision.

But surely we don’t really believe they would collude to take such blatantly manipulative actions, do we?

Where is Dan Brown when you need him?


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