Goldman Sachs on Monday upgraded its coverage view for the software group to "attractive" from "neutral," citing the emergence of a new technology that uses the Internet to centralize all software applications.
Goldman said primary beneficiaries will be leading software vendors, including Microsoft ,Oracle Corp. SAP AG and testing software provider Mercury Interactive Corp Growth in the technology sector has slowed dramatically(not sure about this data) over the past several years in the absence of a compelling new technology, Goldman said. The movement to Web services base standards will enable more flexible and adaptable computer systems to accommodate changes, driving new corporate demand, according to the brokerage firm. Goldman's software analyst Rick Sherlund is not convinced that "the next big thing" is finally on the horizon. Enterprises need to embrace and get soaked in web services architecture to begin benefiting when this movement gains currency in the next few years.
My Take: True that enterprise software companies may gain by embracing web services in a big way – but the advent of web services would also disproportionately influence adoption of small software vendors (who are prepared well for the opportunity) – with enterprises showing promise to buy and use such products atleast in niche and highly specialized/customizable areas. This way, theenterprise software leaders and their ecosystem would grow further and gain strength and momentum. Anycase web services getting into centerstage though later than estimated is a good thing for the industry and business as well.
Category :Enterprise Software, Web Services