Application server market slows

The worldwide application server market hit US$1.18 Billion in 2001, but there was a serve growth slowdown compared to the year before, according to Gartner Dataquest.

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By  Neil Denslow Published  May 24, 2002

The worldwide application server market hit US$1.18 Billion in 2001, but there was a serve growth slowdown compared to the year before, according to Gartner Dataquest.

The 2001 figure represents a 20% increase on 2000’s total of US$990 million, but this paled in comparison to 2000’s 92% growth rate.

BEA retained its leading position in the market with 34% of new license revenue, but IBM was breathing down its shoulders on 31%. Sun (9%), Iona (3%) and Sybase (1%) rounded out the top 5. Big Blue showed the strongest growth in market revenue among the top 5 vendors, primarily by taking market share off the others.

Joanne Correia, vice president for Gartner Dataquest's software industry research group, says that the market is now dividing into two distinct section.

"The application server segment is splitting into low-end and high-end server solutions. On the high-end, IBM and BEA are pushing the millions of transactions per minute threshold. On the low-end, HP and Microsoft are basically offering the good enough 'free' technology to go after the small to medium size business and the low-end transaction processing markets," she explains.

The major software and server hardware vendors are all touting their application server strategy as the e-business platform for building enterprise applications. Correia predicts that the trend of packaging application servers with integration broker suites, packaged applications, portals, development tools, commerce platforms and new software solutions, will grow dramatically in 2002 and continue for the foreseeable future.

"This will result in the next evolution of application server technology in areas such as B2B, enterprise information portals (EIP), business process monitoring (BPM) and business activity monitoring (BAM). This will cause software vendors to continue to change the nature and packaging of their products," she adds.

"Application servers, portal software and integration brokers are merging into a new class of e-business platforms we call application platform suites," notes Correia. "This merging trend will continue through 2003, which means even more application integration market segments and vendor consolidation during the next 12 to 18 months."

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