Giga: IBM and BEA holds J2EE market

IBM and BEA Systems are tied for first place in terms of revenue in the market for Java 2 Enterprise Edition (J2EE) application...

IBM and BEA Systems are tied for first place in terms of revenue in the market for Java 2 Enterprise Edition (J2EE) application servers in 2001, according to new research by the Giga Information Group.

The research pegs both IBM and BEA as holding 34% of the revenue generated in the J2EE server market in 2001, followed by Sun Microsystems's iPlanet unit with 7%, Oracle with 6%, Sybase with 4%, Hewlett-Packard with 3% and miscellaneous others with a total of 12%. In 2001, the market's revenue grew overall by 39%, to a total value of $2.19bn (£1.5bn), according to the report by Giga analyst, Mike Gilpin.

Both IBM and Oracle saw 50% growth rates over 2001, according to Giga. IBM's sales grew because it significantly enhanced its WebSphere application server product and because it tuned the product to support Web services. Meanwhile, BEA grew around 30% year on year, which, given the state of economy, is a strong figure, Gilpin wrote. Giga expects BEA will maintain its leadership position, despite its lower growth rate in 2001, the report said.

Though "all the vendors [in the report] have a large enough market share to have a sustainable application server business", large market share has its benefits, the report said. IBM and BEA's leadership positions in the market will cause software developers to ensure that their products run better on IBM and BEA platforms and will create stronger backing for the platforms from systems integrators, Gilpin wrote.

Users of market leading software should "view this revised financial information as being largely a non-event", the report states. Companies using application servers with a less than 3% market share should consider switching to another product with a more solid presence, Gilpin wrote.

However, he added that there are good cases in which these application servers which have small market shares software can be used, so companies should evaluate their own needs carefully before switching.

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