IBM on Wednesday said that its future e-business software offerings will be developed in partnership with ISVs (independent software vendors) rather than by IBM flying solo.
The decision marks a major change in IBM's strategy, according to William Etherington, IBM senior vice president and group executive, sales and distribution. Previously, "we felt that the only way we could go to market was a top-to-bottom inside-IBM activity," Etherington said.
Now, the company will partner with software developers in different markets and regions to deliver e-business software. The recently announced strategic partnership with Siebel Systems, a maker of sales and marketing customer service applications, to deliver CRM (customer relationship management) offerings, is just one example of IBM's new direction, according to Etherington.
IBM will partner with at least 30 ISVs, and perhaps considerably more, who will in turn gain access to IBM's 27,000-strong worldwide sales force, according to IBM. So far, partners include Internet advertising-software maker DoubleClick; Hyperion Solutions, which makes reporting, analysis, modeling and planning application software; maker of business management software maker Macola Software; and QAD, which is focused on enterprise and supply-chain applications, according to IBM.
One observer was not surprised at IBM's decision to jointly develop and market e-business software.
"Basically it's one of these 'if you can't beat 'em, join 'em' approaches," said Rob Schafer, an analyst with Meta Group in Stamford, Connecticut.
Current Meta Group research shows that, among companies with high-end mainframe systems, just over half of the software budget is for non-IBM software, according to Schafer. By intensive partnering with ISVs, IBM will gain a piece of that revenue stream, Schafer said. More importantly, IBM will "have better influence" on what happens in the platform-brand wars between IBM, Unix and Windows NT which will heat up next quarter once the Y2K issue is put to rest, he said.