IBM Builds On Integration And Middleware Lead - InformationWeek

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4/12/2005
04:16 PM
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IBM Builds On Integration And Middleware Lead

Worldwide among all vendors, new license revenue from application integration, middleware and portals hit $6.7 billion in 2004, up 5.8 percent from the year before.

IBM expanded its already commanding market share lead in application integration and middleware software, according to research firm Gartner, which is calling for moderate growth to continue in the overall integration market this year.

Worldwide among all vendors, new license revenue from application integration, middleware and portals hit $6.7 billion in 2004, up 5.8 percent from the year before. Gartner expects growth to continue at a "slow but positive pace" for most segments, the firm said.

IBM claimed 37.2 percent of the total integration and middleware new license revenue in 2004, with $2.5 billion in sales. IBM's share of the pie rose slightly from 36.3 percent in 2003. The second-largest 2004 market share was commanded by BEA Systems, with 7.2 percent of the market, or $482.3 million in sales. BEA's portion of the market edged down from 8.2 percent 2003.

IBM continues to benefit from a large existing installed base, and the company made several acquisitions in recent years that have allowed it to release integration and middleware products designed for specific industries, said Joanne Correia, research vice president at Gartner. A 10,000-strong software sales force and established strength in the database market have also contributed to IBM's success.

Rounding out the top five vendors in the market last year were Fujitsu, Oracle and Microsoft. Other vendors not in the top five control a full 40.6 percent of the diverse market.

A widespread need to bundle application integration and middleware into other software types is driving the market forward, Gartner said. Those other kinds of software include enterprise applications, mobile and wireless tools.

Businesses continue to move to open architectures for their middleware and integration needs, Correia said. Standards-based tools from IBM, Oracle, BEA and SAP have benefited from the open architecture trend, though Correia said pure-play vendors still have a fighting chance in the market, particularly among certain industry verticals.

Gartner noted that most modern enterprise application projects require portal, integration, business process management (BPM) and business component engineering elements. Gartner defines application integration and middleware as system software or runtime infrastructure that is used to construct individual multi-tiered applications or to communicate between individually designed tools.

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