InformationWeek

IBM estimates that such alliances will generate as much as $7 billion in new revenue during the next three years. Since March, the vendor has teamed with 22 software manufacturers, including heavyweights Ariba, i2 Technologies, and Siebel Systems. The latest round involves five enterprise application software vendors: Aspen Technology, Industrial and Financial Systems, Intentia International, IT Design, and Mincom.

It's a business strategy that might not have been successful for IBM less than a year ago, acknowledges Bob Timpson, general manager of developer relations, because the perception among many software vendors has been that IBM might use an alliance to fill gaps in its own offerings, then compete with the partner once IBM completed development of its own similar products. Judith Hurwitz, president and CEO of Hurwitz Group, agrees. "IBM's answer now is, 'We will not compete and we will bring you new customers,' and that's what they are actually doing," she says.

Brian Harkins, the Aspen Technology VP who oversees alliances, says company officials thought about whether IBM would wind up competing for Aspen's customers, which include 46 of the 50 largest chemical companies, 23 of the 25 largest oil and gas companies, and 18 of the 20 largest pharmaceutical companies worldwide. In the end, he says, "We were comfortable with the assurances we were given by IBM."

Hurwitz says customers will benefit from the strategy because IBM and its partners will offer them state-of-the-art application software that's compatible with IBM's products. For example, she says, by year's end, Siebel software will be available for the 200,000 companies that run AS/400 servers.

Timpson says IBM plans to double the number of partners by year's end. IBM has stopped offering its own enterprise applications--enterprise resource planning, customer-relationship management, and supply-chain products. They "quietly faded away," he says. IBM plans to continue to support all those products.