IDC takes a look at the IBM software business in a new report published on Friday.  The abstract:

IBM's second-quarter earnings announcement on July 18, 2005, underscored renewed strength in its software business, particularly from products in its Lotus division. This IDC Insight examines the earnings announcement and analyzes the likely impact on various Lotus software products and the markets they serve.
The report goes into how Lotus's business has turned around:
After initially confusing customers about the relationship between Domino/Notes and IBM Workplace, during the past year IBM has succeeded at clarifying the relationship between the two, resulting in double-digit growth for each of Lotus' last three quarters.  ...

IBM's 2Q05 performance gives credence to its contention that it is bullish about "gaining market share in the collaborative software ...category," according to CEO Palmisano, and helps build a foundation for success in subsequent quarters. Further, its insistence on following a unique path that leads to a portal-oriented workplace is finally bearing fruit among its customers.
I don't think you can get any stronger of an endorsement that Lotus's strategy is working in the marketplace.  IDC is one of the firms that tracks market share... and they are seeing indications of success.  I especially like the wording "has succeeded" -- past tense, it's done, IBM's on offense, moving forward.  Are there still areas to solidify and clean up?  Yes, of course.  But smart people are working on those.  I was on a call early this morning about Sametime and QuickPlace futures, for example.  IBM understands what the market is looking for.  Everything is moving forward, the momentum is there.

In contrast, there's this press release this morning predicting a decline in Lotus market share.  With, as IDC notes, three quarters of double-digit growth for Lotus Notes/Domino, it's important to consider the basis for a report that indicates declining revenues for 2005 and beyond.  The discrepancy between what both IDC and IBM's CFO says and what this press release says should be enough to put it in its proper place.  By the way, if you want to know the details behind said press release, I suspect this report on Microsoft's website (as opposed to the analyst's own site), which has market share data on page 18, covers it.  There's a contrast there, too, between what Microsoft says and what the report says.

The IDC report will be available on ibm.com soon.  Paying IDC subscribers can access it now.  
Link: IDC: Domino Effect: Lotus Drives IBM's Strong Software Performance in 2Q05 >

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