IBM can just about claim to have been the first to popularise the term ebusiness. But now, after promising to invest a further $1bn in its WebSphere ebusiness development environment, it can justifiably claim this part of the ecommerce landscape as its own.
WebSphere was originally unveiled two years ago, and includes tools to enable businesses to personalise and analyse their web content, handle complex transactions and extend back-end business data and applications to the internet. It also provides them with data security mechanisms, and products to build and customise web portals.
Giga Information Group estimates that the market for what it terms internet middleware was worth $585m last year, and that it will grow to $1.6bn this year and $9bn by 2003. The research company also predicts that by the end of this year, IBM will have a market-leading 24 per cent share of the sector, which is 50 per cent more than 1999.
Big Blue claims that its goal in investing an extra $1bn in its WebSphere business is to bolster its ability to provide organisations with internet infrastructure technologies.
The company invested $1bn in a similar programme last year, and plans to increase that amount by double digits in 2001. These aggressive moves outstrip anything that its rivals are doing at present, and analysts say that it is hard to see how many could afford to match such an investment.
The latest cash injection will be spent on hiring more than 1000 engineers and sales people to work on the WebSphere development environment, and on designing programmes to attract five million developers to create and deploy ebusiness applications on the application server element of it.
A whole third-party WebSphere community is already starting to develop around the technology. Perficient is a US-based internet services firm that has more than 50 consulting professionals dedicated to the WebSphere product suite worldwide.
Jack McDonald, Perficient's chief executive, said: "Business over the internet dictates collaboration between partners, suppliers and customers. From experience, our consultants see WebSphere as the pre-eminent platform for the access and integration necessary for effective collaboration."
John Swainson, general manager of IBM's application and integration middleware unit, attested: "The WebSphere software platform is the first true ebusiness platform. It is an integrated set of technologies that addresses every phase of ebusiness. Customers don't have to search out the pieces or worry about how they'll all fit. No other company - not Oracle, Sun [Microsystems], BEA or Microsoft - has delivered on this promise. And we've got more than 10,000 customers to prove it."
At the same time, IBM also announced a suite of development tools which it claimed will make it easier for developers to produce web applications based on the WebSphere framework.
The software includes the WebSphere Edge server which enables programmers to support RealNetworks' streaming media technology and web-caching software in their packages.
Another component is VisualAge for Java version 3.5 - the latest version of Big Blue's Java development tool. This includes a servlet wizard that developers can use to create server-based Java programs, Java Server Pages and HTML prototypes that can be tested immediately to see whether they contain any bugs.
Meta Group analyst Gene Alvarez believes that IBM is positioning its WebSphere line as a one-stop shop for companies wanting to move their operations onto the web. "It is trying to drive some depth into its offerings," he said. "It is trying to pitch a one-stop solution." He also claims that IBM needed to do this to simplify the WebSphere message.
Alvarez continued that IBM is also playing on its status as a dependable industry veteran to try and make itself viewed as the natural choice if users want a safe supplier of ecommerce products and services. But no-one should underestimate the risks involved in making an investment and commitment of this size, he added.
Competitors, including Hewlett-Packard, Sun and Oracle, are also attempting to exploit the current ecommerce boom by providing companies with the technology to develop online marketplaces and e-procurement trading exchanges.
There may be few companies that are in a position to equal IBM's spend on WebSphere, but should it fail to capture the imagination of the global ecommerce community, then there will be plenty of smaller fry that are more than willing to take up the slack with offerings of their own.
If the investment does pay off, however, IBM could easily find itself enjoying the sort of market dominance it enjoyed in the pre-PC, pre-Microsoft days. Which means Big Blue could be set to become Bigger Blue.
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