EAI market faces challenges

EAI market faces challenges

Enterprise application integration (EAI) software offers users a packaged approach to tying together different corporate systems and applications. But the fast-growing EAI market is highly dynamic and ripe for change as numerous small vendors jockey for position, according to attendees at a Gartner Group conference recently.

The EAI business continues to be beset by a "lot of turmoil," said Gartner analyst Roy Schulte. Packaged EAI software virtually didn't exist a few years ago, and now there are about 40 vendors vying for the budgets of users with integration projects in the works, Schulte said.

Gartner predicts sales of EAI software will total about $US2 billion next year, up from a mere $240 million in 1998. But Schulte and other Gartner analysts said they expect a lot of changes to occur in the future, including the emergence of IBM and Microsoft as dominant EAI vendors.

But the products offered by IBM and Microsoft are far from being completely mature, according to Schulte. IBM faces a potentially disruptive transformation of its MQSeries Integrator software, which is being updated in a new release that Schulte said differs sharply from the first version of the EAI tool and remains unproved.

Meanwhile, Microsoft is yet to release its BizTalk Server 2000 software which will support EAI uses. At the Comdex/Fall 2000 exhibition, Microsoft said it expects to make the XML-based BizTalk package available on a general basis in either January or February.

After IBM and Microsoft come a handful of other fairly sizeable vendors and then a multitude of smaller ones, Schulte said. Some of them are struggling, despite the growth of the EAI market as a whole, he added. For example, Mercator Software had to restate its financial results for the first half of the year and then reported an $8.6 million net loss for the third quarter.

Some users said they weren't overly concerned about the possibility that the EAI vendor they choose now could disappear tomorrow.

"I wouldn't hesitate going with a smaller company that might get bought out," said Scott Rogers, a business systems integrator at VF Corporation in the US. But Rogers added that VF - which makes products such as Lee and Wrangler jeans - chose EAI technology developed by New Era of Networks partly because of that company's business relationship with IBM.

Microsoft's expected arrival as a major EAI vendor could help legitimise the technology in the eyes of many users, said Randy Reed, an application engineer at The Foxboro, a maker of industrial control systems that expects to become a BizTalk Server customer.

"[EAI] is still an immature market," Reed said. "The biggest inhibitor is confusion. People are waiting for a big player to come in."

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