SOAs to spawn $17bn code market

IBM Impact 2007

Third-party 'services' will evolve into a $17bn market by 2013, according to figures from independent research group Wintergreen Research. 

Services in an SOA context are building blocks that offer a specific functionality. A group of functions makes up an application: an e-commerce store, for instance, will combine a shopping cart with invoicing and checkout functionalities.

IBM currently offers 3,600 free and paid services through its SOA Business Catalog, but announced at the Impact 2007 conference in Orlando that it will expand the marketplace to 10,000 services by the end of the year. 

Salesforce.com unveiled a hosted SOA platform on Monday that lets developers access services over the internet. The company will also allow businesses to sell services on its Apex software marketplace. 

SOAs are mostly used for internal development projects, allowing companies to reuse code between departments and applications.

But Susan Eustis, president of Wintergreen Research, estimates that more than 65 per cent of SOA projects have failed.

SOAs raise the quality requirements on code, and internally developed software rarely meets these demands, argued Eustis. This prompts early SOA adopters to look for code sources outside the company.

"You cannot go to [online stock broker] Charles Schwab and say: 'We're going to identify reusable code in our existing asset base,'" she said.

"You are much better off taking reusable components of code that have already been reused and modify those.

"Efficient use of reusable code will come from companies like IBM and Microsoft, that already have highly developed sets of reusable code that has been reused hundreds if not thousands of times."

IBM has much experience with reusing code because it manages thousands of internally developed applications through IBM Global Services' outsourcing deals.

Eustis predicted that ultimately there will be a market for millions of services. The market for services will surpass sales of SOA middleware by a considerable margin.

Companies will spend only $3.7bn on software that runs and manages SOAs by 2013, up from $1bn in 2006, Wintergreen Research predicted.

Vendors in this space will be able to generate additional revenues with certification services that guarantee buyers that services will work together.