Forrester: Application Servers a Critical Component for Internet Computing Infrastructure

Business Wire, Sept 24, 1998

CAMBRIDGE, Mass.--(BUSINESS WIRE)--Sept. 24, 1998--By providing a safe, stable, and scalable environment for Internet computing, application servers are fast becoming a key component in many companies' technology infrastructure. Despite today's immature development tools and a lack of industry standards, Forrester Research, Inc. (Nasdaq:FORR) expects the application server market to mature rapidly, producing more than $2 billion in revenues by 2002.

An application server is a software server product that supports thin clients with an integrated suite of distributed computing capabilities. Application servers manage client sessions; host business logic; and connect to back-end computing resources, including data, transactions, and content. With benefits like easy deployment, standard interfaces, and remote user connections, thin-client applications enable organizations to adapt quickly to changing user demands.

In a recent survey, Forrester found that 74% of Fortune 1,000 firms are already building browser- and Java-based applications using application servers. In two years, these same companies indicated that 66% of all new development will be for thin-client applications. Forrester expects this fundamental shift in the focal point for application development to have a significant impact on both software developers and thin-client hardware vendors.

"Application servers have a great future," said Eric G. Brown, senior analyst in Forrester's Software Strategies service and coauthor of the Report, "Application Server Shakeout." "With businesses looking to cut costs and drive revenue with new Web-based applications, application servers are poised to become a core component in the Internet computing environment."

To meet the demands of distributed computing, application servers must deliver five capabilities: the performance to deliver applications to thousands -- or millions -- of users over the Internet; the connectivity to pull together legacy transactions, warehoused data, packaged applications, and rich Web content; the ability to manage on-line performance and software updates; a fast, flexible development environment; and support for Transactive Content.

Unfortunately, the current application server market is crowded and confused with more than 25 vendors offering incomplete or immature products. By 2001, Forrester expects acquisitions, alliances, and internal developments to narrow this field to five key vendors: IBM, Microsoft, Netscape, Oracle, and Sun.

During this market shakeout, large companies need to approach their application server commitments with tempered enthusiasm. Today's product immaturity demands that firms assemble a portfolio of app server suppliers, anchored by one key vendor and complemented by a short list of tactical, gap-filling products. Each firm's strategic component platform -- COM or JavaBeans/CORBA -- will be a key factor in the application server selection.

"Companies need to view their development efforts for applications as a strategic investment," noted Ted Schadler, senior analyst in Forrester's Software Strategies service and coauthor of the Report. "App servers will be a critical piece of the infrastructure in a few years, but today's products are too immature to warrant a wholesale investment."

Forrester Research, Inc., is a leading independent research firm offering products and services that help its clients assess the effects of technology on their businesses. Forrester provides analysis and insight into a broad range of technology areas such as new media, computing, software, networking, telecommunications, and the Internet, and it projects how technology trends will affect businesses, consumers, and society. Forrester's European Research Center, located in Amsterdam, Netherlands, brings the company's unique perspective to new media developments in Europe. Additional information about Forrester Research can be found on the Web at www.forrester.com.