Analyst Reports Cloud App-Server Debate

The latest report from Gartner Dataquest, published late last month, states that while IBM's WebSphere grew a whopping 71 percent in 2001 and captured 31 percent of the market, BEA was still the market leader in terms of new licensing revenue. According to Gartner's research, BEA's WebLogic, which grew 23 percent last year, was still ahead of IBM with 34 percent of the total market. IBM, however, grew much more than any other vendor in the space.

"The result was that IBM gained market share of new license revenue at the expense of Sun [Microsystems and other vendors," wrote Gartner's Joanne Correia.

And while IDC's recent study also put BEA at the top of the application-server market, it noted that IBM had narrowed the gap at the No. 2 spot.

The new studies from IDC and Gartner offer a stark contrast to earlier reports. Last month, Giga Information Group released its market-share study that had IBM and BEA tied for first with 34 percent of the market each and other vendors, such as Oracle, Sun and Sybase, with single-digit market share.

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To make matters even more confusing, a controversial Hurwitz Group report released last December actually had Oracle as the leading application-server vendor in North America based on "organizational penetration," which measured the number of companies that used a particular application server, not license revenue.

Competing vendors, including BEA, contested the Hurwitz Group report because it didn't consider the volume of application servers sold or how much money customers spent on each brand. The report was also criticized because its author, Evan Quinn, now works at Oracle's analyst relations department.

There are other points of contention among the various new reports on the application-server market. For example, Gartner's report listed only unbundled application servers, thereby excluding Oracle's 9iAS and Microsoft's Windows' .NET package. And some of the studies had Oracle, Sun and Sybase in alternating positions in the third, fourth and fifth spots. All three own single-digit market shares, based on license revenue, and were far behind BEA and IBM.

Despite their differences, most of the reports agree on two things: IBM's meteoric rise in the application-server market and the strong growth of the $2 billion application-server market in general. Gartner predicts the market will reach $3.2 billion by 2006, while IDC forecasts a $4.4 billion application-server market for the same year.