IBM's Middleware Dominance: Enterprise Software Market-Share Looks Unchanged

Includes: IBM, MSFT, ORCL
by: Dennis Byron

It doesn't surprise me that IBM is "proclaiming its middleware dominance," which is what Dave Rosenberg says in his blog April 12. After all, the enterprise software market-share silly season rolls in with the buds on the Forsythia bushes in Armonk.

But Dave, I can't find a mention of this data anywhere else on the web except your blog. What's up?

Anyway, according to Dave, IBM says it has 75% of the services oriented architecture (SOA) market and 31% of the overall middleware market. Not really any new news there. IBM has had 10% of the overall $250-million plus enterprise software market for a long while now, since whenever Microsoft (NASDAQ:MSFT) passed it to move into the number-1 slot. Now with the acquisition of Sun, Oracle (NYSE:ORCL) might have slipped into the number-2 position, but that depends on how much Sun slipped before it fell.

But that's only looking at the elephant from one end. Because IBM doesn't sell ERP and other types of enterprise application suites, IBM actually has maybe 15% of its total addressable market (TAM), which includes such things as operating systems, database management software, development tools, application servers, collaboration software, network management, and so forth.

And you need to slice and dice even that number a little more. In IBM's 15% of its TAM, it has as much as 90% of the mainframe-based enterprise software market. (Florian Mueller has been reminding us of that for the last week, receiving everlasting damnation from the open source community for his efforts. Worse, they are calling him a Microsoft lapdog.)

Hell, last time I ran the numbers - admittedly it's been a few years - IBM was still doing a billion a year in CICS, giving it maybe 99% of the TP monitor market. But that means that IBM has less than 10% of its remaining addressable market. Its middleware dominance could all be CICS for all I know. Is CICS SOA?

So when we see the numbers later in the spring, we'll get into it a little deeper. But so far, as expected, it does not look like anyone changed places in 2009 enterprise software market share rankings vs. 2008.

Disclosure: No financial interest in companies mentioned.