For Subscribers

Get the complete article now!

Eight experts, three analysts and top management from thirty-eight sector firms examine the e-Business sector in this special 190-page e-Business issue from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info468.htm.

TWST: Looking at it from the enterprise perspective, are those areas where money is being spent? As you look out over the next 12-24 months, what are the necessities for users to be adopters of tools and products within those three areas?

Mr. Ekoniak: The areas that I mentioned are seeing strong demand from potential customers. Enterprises are telling their software vendors where they would like to go next in terms of software purchases. The need is demand-driven.

TWST: How do those thoughts apply to the business intelligence/analytics area specifically?

Mr. Ekoniak: We really like the business intelligence/analytics space. Looking at growth rates over the last three quarters — year-over-year growth rates for various sectors within software — the business intelligence/analytics sector has actually held up the best. We compared the business intelligence/analytics space to the CRM, supply chain and ERP areas. In Q3 we actually saw a 1% year-over-year growth rate in the analytic sector, whereas CRM saw a decline of 27%, supply chain was down 18%, and ERP was down 27%. The business intelligence/analytics sector has held up the best but, more importantly, we believe it will continue to outperform the other sectors. We believe it will likely show a recovery up to two quarters faster than the other sectors. We based our conclusions on several factors: the sector offers quick implementation times, low average sales prices, and the ability to leverage existing software investment. Additionally, this is a greenfield area that has the opportunity for rapid growth over the next several years. Very few companies have deployed analytical applications at this time. In contrast, we are seeing some market saturation, at least for the near term, in both CRM and supply chain. There appears to be some indigestion in the market from companies that have aggressively purchased CRM and supply chain systems over the last couple of years. The pace of buying was frantic. But before companies consider coming back to their vendors and buying more software, they want to get their existing products up and running and providing a meaningful ROI.

TWST: Which companies are the ones to watch in this area?

Mr. Ekoniak: In the business intelligence space the leaders that we like are Business Objects (Nasdaq:BOBJ) and Informatica (Nasdaq:INFA). There is also a very large private company, SAS Institute, that has over 1 billion in revenue that is worth watching.

TWST: What are the inflection points or goals for Business Objects and Informatica over the next six to 12 months?

Mr. Ekoniak: The attractiveness of the Informatica story is in its application product line. This is a recently released product line that builds on Informatica’s infrastructure products within the analytic space. Once again, this is a new area. Informatica had six new customers last quarter and five new customers the quarter before. It is still a growth area, but our revenue estimates do not assume much growth for next year. So if Informatica is successful in this area, we believe there will be upside to the stock.

1) The Future of e-Business - In an in-depth (2,200 words) Expert Interview, Mick Calder, Analyst at Line56, examines the outlook for the sector.

2) B2B Supply Chain Strategy - In an in-depth (3,000 words) Expert Interview, Rick Andrade, Senior Manager at Cap Gemini Ernst & Young, examines the outlook for the sector.

3) e-Business Management Strategies - In an in-depth (2,300 words) Expert Interview, Cathy Spencer, Research Director at Gartner Inc., examines the outlook for the sector.

4) Outlook for CRM and PRM Suppliers - In an in-depth (1,200 words) Expert Interview, Karen E. Smith, Senior Analyst at Aberdeen Group, examines the outlook for the sector.

5) The Continuing Evolution of B2B - In an in-depth (2,900 words) Expert Interview, Thomas M. Koulopoulos, President at The Delphi Group, examines the outlook for the sector.

6) Supply Chain Management Services - In an in-depth (3,400 words) Expert Interview, Jay Holata, Associate Partner of Accenture, examines the outlook for the sector.

7) Investing in e-Business Stocks - In an in-depth (3,100 words) Expert Interview, Robert McCullough, Director for Hurwitz Group, examines the outlook for the sector.

8) Supply Chain Strategies - In an in-depth (3,900 words) Expert Interview, John Fontanella, Service Director at AMR Research, examines the outlook for the sector.

9) E-Commerce Software - In an in-depth (3,500 words) Analyst Interview, Jon Ekoniak, Vice President at U.S. Bancorp Piper Jaffray Inc., examines the outlook for the sector and shares specific stock recommendations.

10) Outlook for e-Business - In an in-depth (2,400 words) Analyst Interview, William Chappell, Senior Analyst in Equity Research at SunTrust Robinson Humphrey, examines the outlook for the sector and shares specific stock recommendations.

11) Enterprise Solutions in B2B - In an in-depth (1,800 words) Analyst Interview, Robert B. Austrian, Managing Director at Banc of America Securities, examines the outlook for the sector and shares specific stock recommendations.

12) CEO interviews (average 2,500 words). Top management of thirty-eight sector firms examine the outlook for their firm and the sector.