July 31, 2008 10:54 ET
IBM Growth in Emerging Markets Fuels Lotus Momentum
ARMONK, NY--(Marketwire - July 31, 2008) - Led by strong sales of IBM (NYSE: IBM) Lotus
Notes and Domino 8 in the second quarter of 2008, IBM's Lotus software
business outgrew Microsoft by winning millions of customer seats worldwide
in direct competition with Microsoft, aided by key wins over its
Redmond-based rival in emerging markets.
IBM's emerging markets represented 18 percent of IBM's overall geographic
revenue in the second quarter of 2008, and together grew 21 percent as
reported. In addition, the Brazil, Russia, India and China subset grew 31
percent in the second quarter, led by strong growth in India.
Among those customer wins was Lotus' largest Asian customer engagement to
date -- a major bank licensing 300,000 Lotus Notes seats as well as Lotus
Symphony, IBM's free personal productivity software based on the the
OpenDocument Format. Lotus Symphony has been downloaded by over 1.3 million
individuals and businesses, including scores of Microsoft Office customers.
Customers that chose Lotus Notes and Domino over Microsoft in key markets
included Max New York Life, Reliance Industries, Vedanta, and Aviva in
India; GD Development Bank, Johnson Electric, HKG Environ Protect, CED, DL
Cosco Shipyard in China; Affin Bank and Trakando in Singapore; and Russian
Railways in Russia.
"Enterprise customers -- especially many rapidly-growing businesses in
emerging global markets -- are choosing Lotus software for its open,
flexible design," said Bob Picciano general manager, Lotus Software.
"These companies prefer open standards over the restrictions of legacy
proprietary technology for their long-term collaboration investments."
The second quarter saw the largest historical client win for Lotus in North
America as well. A member of the so-called "big six" accounting/consulting
firms purchased more than 150,000 seats of the entire Lotus portfolio,
selecting Lotus Notes, Lotus Sametime, Lotus Connections, IBM Lotus Quickr
and WebSphere Portal over Microsoft Exchange and SharePoint, among other
products. Other large companies that chose Lotus Notes and other Lotus
software over Microsoft products included several leading banks in the
U.S., the United Kingdom and Germany, as well as the Australian government.
Other clients who have recently invested in Lotus Notes and other Lotus
software over the competition include consumer goods giant
Colgate-Palmolive, chemical manufacturer Ineos of Belgium, the U.S. Federal
Aviation Administration, NutraFlo, Dutch Railways, Rohm Haas, Imerys and
the Salvation Army. Specifically moving to Lotus Notes 8 were CFE
Compagnie d'Enterprises of France, Virginia Commonweath University, Winsol
International, The U.S. General Services Administration, the U.S. Internal
Revenue Service, Standard Insurance, New York Life, Kentucky Baptist
Convention, Verizon, Publishers Printing, Hyatt Hotels, Union Pacific and
Many clients of all sizes are questioning their investments in legacy
Microsoft software products. Migrating to new versions of Microsoft
Exchange has proven to be a daunting and expensive task. Ferris Research
recently published a report (Exchange 2007 Implementation Issues, December
2007) that indicated 70% of Microsoft customers felt that migrating to
Exchange 2007 was either "Difficult or Very Difficult."
Large companies are concerned with the prospect of upgrading to Microsoft's
Vista operating system and continued high percentage of IT costs devoted
to personal computers amid challenging economic conditions. Meanwhile,
more strategic IT investments that could spur top-line revenue growth go
unfunded and unrealized.
Increasingly, both public and private sector companies are looking at open
alternatives such as IBM Lotus Symphony and other solutions from
OpenOffice.org. One such organization that is making the switch to Lotus
Symphony is the Anglican Church of Australia, which stated publicly that it
will save an estimated AU$150,000 a year.
Industry analysts credit Lotus with a more innovative, open portfolio that
gives businesses freedom of choice, lower IT costs, and more insightful
employee tools. For example, the industry's first enterprise social
networking product, IBM Lotus Connections, doubled its client base this
year after debuting as the fastest growing new IBM software product in
2007. At the recent Enterprise 2.0 conference in Boston, attendees
witnessed a demonstration comparison pitting IBM Lotus Connections against
Microsoft SharePoint. Moderator Mike Gotta of the Burton Group summed up
the audience's reaction in his blog, "Collaborative Thinking." He wrote,
"IBM was the clear winner across the board. Maybe Microsoft underestimated
IBM. And in some cases, decision-makers are more open to at least
considering alternate solutions they might not have even entertained before
(which would be good news for IBM and Jive in particular)."
IBM Lotus Sametime, IBM's platform for unified communications and
collaboration, vaulted to over 100 million individual licensed seats in the
second quarter with one-third of sales going to Microsoft customers. IBM
WebSphere Portal software with Web 2.0 technology has won marketshare
leadership for seven consecutive years by leading research firms, Gartner
and IDC (see separate release today). Lotus has also launched new
products in the software mashup, computer appliance, and
With 15 consecutive quarters of revenue growth, IBM's flagship Lotus Notes
and Domino products has been transformed into a versatile tool that
consolidates the individual's work world onto one screen, employs Web 2.0
technologies and reduces time spent on email. Lotus Notes and Domino
adoption has grown to more than 140 million licenses with gains across
small-medium business, more than half of the largest 100 corporations in
the world, 80 percent of the top 10 global companies in banking,
telecommunications, aerospace and defense, consumer products, electronics,
insurance, and pharmaceuticals.
For more information, please visit: www.ibm.com/lotus/notesdomino