Report: $3.8 Billion U.S. Market for E-Commerce Software by 2002

Forrester Research Inc. launched a new
Commerce Technology Strategies service, and its first report predicts a $3.8
billion U.S. market for electronic commerce software by 2002.

The new service will focus on the technologies that enable online commerce,
helping companies make wise technology decisions that create a competitive
advantage, the company said.

Future research topics include Internet commerce architectures, development
tools and applications, integration with legacy applications, and transactive

Said George F. Colony, president of Forrester Research in Cambridge, MA:
“Commerce Technology Strategies rounds out Forrester’s Internet commerce
offerings. As companies prepare to launch their initiatives, Commerce
Technology Strategies will provide
a lens into the enabling technologies that will ultimately affect their
transition into the Internet economy.”

In the service’s first Report, “Sizing Commerce Software,” Forrester predicts
that the commerce software market in the United States will grow from $121
million in revenues in 1997 to $3.8 billion by 2002. Taking Europe and Asia
into account, worldwide revenues for commerce software are expected to reach
$4.9 billion by 2002.

This growth will be driven by vast numbers of businesses going online,
increased demand for Web-based services from businesses and consumers, and a
preference for packaged commerce solutions among buyers, the report said.

“The next two years will produce dramatic growth in the commerce software
market as businesses get serious about buying, selling, and trading online,”
said Stan Dolberg, director of Commerce Technology Strategies and author of
the Report.

Within the commerce software market, Forrester said it sees three trends
emerging: Sell-side systems and tools will dominate the market as companies
build catalogs and auction networks with Transactive Content; customer service
applications will emerge as another
important segment, delivering enhanced self-service, order confirmation and
tracking, and proactive communication with consumers; and buy-side
software will be gradually adopted by large firms and business units seeking
to streamline purchasing.

As the installed base of commerce software expands, Forrester believes that a
few key industries will achieve critical mass, giving rise to an Internet
commerce power grid that supports dynamic trading processes. In this
environment, catalogs, offers, orders and digital goods will flow smoothly
between buyers, sellers, and intermediaries,
driving markets to new levels of efficiency. As these Internet commerce power
grids proliferate and interconnect, the entire business environment will
ultimately be reshaped.

Commerce Technology Strategies’ first report, “Sizing Commerce Software,” will be available free online for a limited time at Forrester’s Web site.

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