Speaking to a conference of small technology partners Sunday, Microsoft Corp. chief executive Steve Ballmer said that his company will continue to expand its small business software lines for a variety of industries, beginning with accounting.
The niche marketplace for small business applications, where many companies have thrived writing industry- and even company-specific software, will face Microsoft's first major entry this fall, when Microsoft's Small Business Accounting is launched. The software will compete with other accounting programs such as Intuit Inc.'s QuickBooks.
"We do believe that the business application market will continue to get consolidated to some degree," Ballmer said, according to a transcript of his remarks posted on Microsoft's Web site. Ballmer pointed to Microsoft's 2001 and 2002 acquisitions of Great Plains (a provider of software to midsized companies) and Navision (a provider of human resources, accounting and customer relationship software) as the first moves the company made when they recognized the possibilities for the market.
Ballmer said that Microsoft has hired more than 200 people in a variety of industries - such as health care, banking and manufacturing -- to help write and fine-tune software. Last year, Microsoft announced that it will invest an annual $2 billion for the next five years in sales, marketing and development efforts targeted at small and midsized business.
AMR Research forecasts that Microsoft will have a 3 percent share of the $24 billion enterprise resource planning market in 2005, behind SAP, PeopleSoft, Oracle and SageGroup. Oracle nearly doubled the size of its business through its December 2004 acquisition of PeopleSoft, and AMR Research expects Microsoft to finish this year with a growth rate of 15 percent, more than both SAP and SageGroup.
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