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Y2K gives supply-chain software sales a boost

A recent survey says the Y2K glitch is a driving force for increased sales in the supply-chain applications market, as companies scramble to update old computer systems.

    The year 2000 technology glitch is a driving force for increased sales in the supply-chain applications market, as companies scramble to update old computer systems, according to a recent survey.

    Supply-chain software sales worldwide reached $13 billion in 1998, and revenue is expected to grow to $22.9 billion by 2003, according to a recent International Data Corporation (IDC) report.

    Businesses use supply-chain software to track goods and services from the design and engineering phase through manufacturing and sale. The software is often customized to meet the needs of different types of businesses.

    However, competition for supply-chain software sales is fierce in this highly fragmented market. The top 10 supply-chain software makers account for just 33 percent of the total revenues in the market.

    "In the future, supply-chain automation and an increase in the number of casual users interacting with industry-specific applications will propel the market forward," said Dennis Byron, director of IDC's supply chain applications research.

    The United States spends more on this type of software than other region, deploying 45 percent of supply-chain applications in 1998. Western Europe is the next largest market, accounting for 31 percent of spending.

    According to IDC, Unix was the top operating system used for supply-chain applications in 1998. Unix-based applications account for more than half of the market's total revenue. Windows-based applications came in second, claiming about 22 percent of revenues.

    Almost all of the main packaged application suppliers have committed to Windows 2000, Active Directory, Biztalk, and the various iterations of Microsoft's Distributed InterNetworking Architecture (DNA), including ActiveStore, Byron said.