Software suppliers should begin to look at e-communities as a major source of business despite the dot-com debacle, according to IDC. The market for packaged software deployed specifically to support e-communities will grow from about $1 billion in 2001 to nearly $6 billion in 2004. This growth represents a jump from less than 0.1% of all software revenue to almost 2% during this time period.
"E-communities need all the same sorts of packaged software as brick-and-mortar businesses and organizations," said Dennis Byron, vice president of IDC`s Enterprise Applications research. "In fact, the same packaged software strategies brick-and-mortar businesses use to reduce time to market and increase return on investment work for e-communities. Despite the applicability of similar strategies, however, e-communities are still different from brick and mortars in how they can deploy and use packaged software, and software marketers need to understand e-community needs and additional requirements, as well as the potential drivers and inhibitors, to penetrate this market."
According to IDC, one additional e-community requirement of which software marketers should be aware is the need to automate few-to-many and many-to-many relationships online in real time. "Another issue for e-communities is whether they can start from scratch with a clean sheet of paper, leaving legacy applications, operating software, and, most important, culture and procedures behind," Byron said.
IDC believes building alliances is a critical element to penetrating this market. Alliances are important not only for speed to market but also for the purpose of leveraging brand and customer base to gain market share, attract members, and build liquidity, the last of which is a key concern of e-communities. "Spending resources trying to internally develop and complete an end-to-end e-community solution for each e-community will put companies out of business," Byron advised.
IDC`s recently published bulletin E-community Software Market Drivers and Dynamics: Baseline View (IDC #B24340) analyses the e-community software market. Demands, market drivers, and inhibitors are examined
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