SAP Fights Off Oracle in CRM MarketBy Mel Duvall | Posted 2006-06-13 Email Print
WEBINAR: Available On-Demand
Innovate and Thrive: How to Compete in the API Economy REGISTER >
SAP was the top vendor in the category with about 26% of the market in 2005, but Oracle is closing in after its purchase of Siebel.
SAP still brings home more dollars from its customer relationship management (CRM) software business than anyone else, but Oracle is closing in on the German giant.
Last year, SAP was the top vendor by revenue in the CRM category with about 26% of the market, followed by Siebel with 17% and Oracle with 6.4%. However, with Oracle's purchase of Siebel Systems in January, Oracle now controls 23% of the market.
CRM software experienced strong growth in 2005, according to Stamford, Conn.-based research firm Gartner, as companies looked for more opportunities to drive revenue and expand business lines. Worldwide CRM revenue totaled $5.7 billion in 2005, a 14% increase over 2004, Gartner says.
Salesforce.com, which specializes in an on-demand version of its software delivered over the Internet, owned about 5% of the market, and Amdocs also had about 5%. The biggest gainer year-over-year was Salesforce.com, which experienced a 78% gain in revenue, from $158 million to $281 million.
"Merger-and-acquisition activity continued relentlessly in 2005, as larger vendors acquired smaller firms and market leaders acquired each other," Gartner analyst Sharon Mertz said in a press release announcing the research. "Buyers were solidly focused on new customer acquisition, expanding wallet share, process optimization and business accountability."
The application integration market also experienced growth in 2005, although not as strong as the CRM category. Gartner reported last week that total software revenue in the integration market, which encompasses service-oriented architecture (SOA), reached $8.5 billion in 2005, a 7.1% increase over 2004.
The top five vendors accounted for 69% of the market, with IBM the clear leader at 37%. Next in line were BEA Systems with 14.5%, Oracle with 8.7%, Microsoft with 4.7% and Tibco pulling in 3.7%.
Oracle appeared to have the most momentum in this space, with revenue increasing 40% in 2005, from $530 million in 2004 to $740 million. Next in line was Microsoft, which saw revenue grow 13%, from $350 million to $397 million.