IDC: Middleware Market Primed for Growth

Expect the middleware market to burgeon in the next five years, International Data Corp. (IDC) said in a report released Wednesday. IDC expects worldwide middleware and business software revenues to leap by 255 per cent, from $US2.7 billion in 1999 to almost $US9.7 billion in 2004.

"The move to (electronic) business is responsible for the phenomenal growth" in the middleware and business software market, said Sally Cusack, manager for IDC's middleware and businessware research program.

The largest opportunity in the middleware market lies within businessware management systems, according to Cusack. In 1999, this segment was the largest part of the market, with $US673 million in revenue. From 1999 to 2004, revenue is expected to increase at a CAGR (compound annual growth rate) of 51 per cent, while the rest of the middleware market will increase at a CAGR of about 29 per cent.

The businessware management systems is "where the functionality and capabilities necessary to deploy a true e-business structure are found," Cusack said.

Message-oriented middleware, along with functions such as publishing and subscribing, are all core foundations for e-business, and companies can add or build other services to create a comprehensive e-business environment, such as management services and security, she added.

Vendors in the U.S. will benefit the most from the middleware market growth, mainly because key middleware vendors are located there. Cusack cited IBM Corp., BEA Systems Inc., Tibco Software Inc., Mercator Software Inc., NEON (New Area of Networks), Vitria Technology Inc. and WebMethods Inc., among others, as key players in the crowded market.

In 1999, U.S. middleware vendors captured almost 75 per cent of worldwide revenue, and North America produced almost 50 per cent of the market's revenue, Cusack said.

The strongest international player in the middleware market is definitely German system software vendor Software AG Inc., Cusack said, adding that Hitachi Ltd. is another international vendor that could achieve success in the heavily U.S. vendor-dominated market.

The report, "Middleware and Businessware Market Forecast and Analysis, 2000-2004," divided middleware into legacyware, data-access middleware, remote procedure call middleware, transaction server middleware, object middleware and businessware management system software segments.

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