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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Mike Buckley who wrote (7234)	9/30/1999
From: Mike Buckley	Respond to of 54805

AMR Research updated their projections for the CRM growth. For total growth, they're projecting about the same that they estimated last year but they added year 2003 to the estimates. "Total 1998 CRM company revenue hit $2.3 billion [up from $1.2 billion in 1997] and AMR Research predicts that the CRM market will grow 60 percent in 1999 to $3.7 billion. After 1999, the CRM market will resume a 49 percent CAGR, exceeding $16.8 billion by 2003. The firm also predicts that the European CRM market will grow to $4.3 billion in 2003 from $500 million in 1998, with a compound annual growth rate of 53 percent, exceeding the 44 percent CAGR expected in North America over the same time period. Total Customer Relationship Management Revenue, 1998 - 2003 Forecast 1998 1999 2000 2001 2002 2003 5 Year CAGR 2.3 B $3.7 B $5.4 B $7.9 B $11.5 B $16.8 B 49% <snip> The top vendors, based on 1998 total company revenue, were Siebel, Vantive, and Clarify. ERP vendors are beginning to have a tremendous impact on the CRM market, with Oracle and Baan capturing two of the top five positions in overall CRM revenue. These top five vendors contributed 40 percent of overall CRM revenue, with the market leaders growing a hardy 90 percent combined in 1998." Okay, let's back out those numbers. The top five vendors contributed 40% of the total, or $920 million. We know that Siebel, Vantive and Clarify had combined 1998 revenue of $685 million. That leaves the difference, $235 million, for Baan and Oracle. Those numbers show a contradiction about the ERP role in the field. If you play with the numbers Oracle has been reporting, it's mathematically impossible to arrive at numbers left over for Baan that would also render Baan the #4 player. Personally, I don't believe Baan and Oracle had combined revenue of $235 based on everything I've seen. --Mike Buckley