Middle East EAI market promises growth

An increasing number of vendors are beginning to target the local enterprise application integration (EAI) market due to its promise.

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By  Maddy Reddy Published  February 8, 2004

|~|TIBCO2.jpg|~|Mena eSolutions’ Julian Lloyd says the Middle East is a high speed development market.|~|A number of vendors are currently ramping up their enterprise application integration (EAI) offerings in the Middle East with the addition of new product lines and services. Microsoft, for instance, is set to unveil Host Integration Server 2004, Biz Talk Server 2004 and its latest versions of SNA Server later this quarter, while IBM is gearing up to launch Web Sphere 6 in the region during 2Q04. Tibco, which is targeting the Middle East through its regional partner, Mena eSolutions, is also gearing up for local growth as it attempts to leverage its successes with customers such as Emirates Bank and Saudi American Bank. “We rate the Middle East as a high speed development EAI market — especially in the financial service verticals like banks. Worldwide, energy and financial services are important markets for us too, and in the Middle East we see these verticals as our emerging markets,” says Julian Lloyd, vice president, corporate development, Mena eSolutions. This local activity reflects growing worldwide interest in the EAI market, which has seen traditional enterprise application vendors like SAP with the Net Weaver platform and PeopleSoft with its AppConnect technology begin to target the EAI space. In fact, Gartner Group believes the EAI market will reach US$10.5 billion by 2006 as globalisation, mergers, acquisitions, traditional business demands and the renewing of business applications fuel adoption. Other factors more specific to the Middle East are also driving vendor interest and end user adoption. For instance, the fledgling status of the local market means a number of companies are only now beginning to upgrade their applications to international products. “Today, lots of customers are using EAI because they have a strong business need to connect their legacy and new enterprise applications, as users cannot throw away all their old IT investments,” says Bashar Kilani, manager of IBM’s software group in the Middle East & North/West Africa. “EAI provides that middleware layer to integrate it all,” he explains. Another factor in the regional adoption of EAI is the desire of many organisations’ to buy best of breed solutions. While this ensures users have access to the best tools for the job, it can create an integration nightmare. “The costs involved in integrating X app to Y application can sometimes exceed the cost of the applications themselves,” warns Ihab Foudeh, group technology manager, Microsoft South Gulf. “Finding out the pain points of the enterprise customer is the challenge for EAI,” he adds. In fact, despite the high percentage of greenfield implementations within the region which should, theoretically, mean there is less need for hardcore integration and EAI products, local market demand shows little sign of abating. “The need for enterprise apps to talk to each other will always exist [even in greenfield sites],” says Enrico Camerinelli, programme director for enterprise applications at Meta Group. “The market opportunity in this region will be to bridge all the new enterprise applications in terms of workflow, business processes and messaging,” he adds. Moving forward, it appears as if the only factors capable of halting EAI’s march towards Gartner’s US$10.5 billion by 2006 figure are its own popularity and the activities of the vendors themselves. Both the drive for standardisation, which is currently being undertaken by the Microsoft, Tibco and BEA triumvirate, and the growing adoption and acceptance of EAI are turning it into a commodity, which typically means lower pricing. In turn, this means the market will be dominated by just a handful of vendors. “The market is going away from the traditional concept of EAI. It is now becoming a commodity and being treated as a part of the infrastructure. We are seeing vendors moving from EAI software revenues to business process management,” confirms Camerinelli. ||**||

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