IBM within arms reach of BEA

IBM Corp. continues to build momentum in the application server market, creeping to within three percentage points of market leader BEA Systems Inc., according to a report released by International Data Corp. on Monday.

IBM's Websphere application server worldwide market share grew to 15.4 percent compared to BEA's 18.2 percent, according to the report. It also said Websphere's growth rate over 1999 and 2000 was 258 percent, or about twice the market's average. Sun Microsystems Inc. finished third with 8 percent market share.

Many observers, including IDC, expected the application server market to cool off over the course of 2000, but instead it grew even more aggressively.

"It's difficult to overstate the significance of this growth rate. When a market reaches the level the application server software platform market reached in 1999, annual growth usually slows, not accelerates. End-users are clearly demonstrating a commitment to moving forward with the distributed, multi-tiered component-based solutions," said Steve Garone, president of IDC's application development and deployment research in Framingham, Mass.

In 1999 worldwide revenues in this market grew 110 percent to US$957 million. But in 2000, revenues grew another 128 percent to just less than $2.2 billion, with strong growth expected to last through 2005, according to IDC.

To stay competitive and to lay claim to these expected revenues, all competitors, including IBM and BEA, need to continue to offer a well-rounded e-business platform replete with functions that allow users build and deploy e-business applications. They should only leverage the application server software "as a foundation layer," Garone said.

"The early days of e-business focused on getting to the Web, with most devoting their efforts to creating Web sites. Today users need an e-business platform that encompasses needs to build and deploy e-business applications," Garone said.

For more information about the new report, called Application Server Software Platforms market Forecast 2001-2005, users can go to www.idc.com.

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