Focus on Technology

Most small to midsize businesses have small or nonexistent information technology departments, but to remain competitive, all need cutting-edge computing capabilities. The global market for these IT needs is estimated at $500 billion, so IBM, a goliath company that does not yet serve this market, is developing a Global Applications Marketplace (also called Blue Business Platform) for small businesses. Through this platform, a small business can search and purchase software applications from independent software vendors around the world. However, local IBM partners will install and manage the applications for the business. When businesses enter information and receive recommendations through the Global Applications Marketplace, they receive product reviews along with access to an online IBM advisor. IBM is setting up hundreds of local vendor partners—called

"innovation centers"—around the world, several of them in emerging markets. The Global Applications Marketplace is designed much like Apple's ¡Tunes—customers will need an IBM server to use the system, just like consumers must have ¡Pods to purchase music and movies from iTunes. While IBM is making the world available to small businesses, IBM's local channel partners bring it to their doorstep.

1. Read more about this initiative at www-03.ibm.com/press/us/ en/pressrelease/24111 .wss. Explain how IBM is delivering value for small to midsize businesses. How is it delivering value to independent software vendors?

2. Who will be IBM's competitors in this market space? What advantage does IBM offer over these competitors?

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