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Report: IBM # 1 in Worldwide Internet Infrastructure Services Marketplace

IBM Market Share Continues to Rise According to Tier 1 Research

For the second year in a row, IBM is ranked as the leading Internet Infrastructure Services provider in the world, according to a new report on the marketplace published by Tier 1 Research, a leading technology research firm.

In the Tier 1 Research study, published as: "Internet Infrastructure Services 2004 Mid-Year Market Size/Share Review," IBM's overall share of the global Web hosting marketplace continues to rise and is expected to reach 20 percent in 2004, which would be up from 17.9 percent in 2003. According to the report, IBM's revenue of the global Web hosting market rose to $470 million in the second quarter of 2004, a 12.1 percent increase quarter-over-quarter and 31 percent increase year-over-year. Tier 1 Research shows IBM with a commanding share of the marketplace -- triple that of the next closest competitor.

Tier 1 Research defines the overall Internet Infrastructure Services industry as being comprised of three primary segments: collocation hosting, dedicated hosting and utility computing services.

"IBM remains the worldwide leader and is seen reaching a 20 percent share in 2004," said Andrew Schroepfer, President of Tier 1 Research.

The Internet Infrastructure Services industry revenue rose 10.4 percent in 2Q04 to $2.27 billion, marking the third consecutive quarter of double digit year-over-year growth and bringing first half Internet Infrastructure Services industry revenues to $4.46 billion. Tier 1 Research estimates that the Internet Infrastructure Services market will top $10 billion for the first time in 2005 and dynamic utility computing services will top $1 billion in 2007, which saw revenues of $260 million in 2003.

"The latest figures from Tier 1 Research demonstrate IBM's continued commitment to provide customers with world class services and clearly indicate that IBM is winning in the marketplace," said Mark Morin, general manager, IBM Global Services. "IBM taps resources from across the company -- including consulting expertise and research prowess -- to provide customers of all sizes with innovative solutions to help them transform into on demand businesses."

About Tier 1 Research

Tier1 Research is an independent research firm covering the Information Technology (IT) and Telecommunications markets, often referred to as the Internet Infrastructure industry. Founded in August 2000, T1R's business model combines financial and strategic analysis of both public and private companies to bring a holistic perspective that merges the best of Wall Street with industry research. Tier1 Research works with institutional investors, venture capital firms, enterprise IT buyers, and industry vendors as an extension of their competitive analysis team. Services include the daily "Infrastructure Insider," hot topic and market sizing reports, financial models, online databases containing deeper operational and statistical details, "morning calls," the Vendor Perception Index (VPI), and consulting services. The company is based in Minneapolis and has offices in New York and Silicon Valley. More information can be found at www.T1R.com.

About IBM Global Services

IBM Global Services is the world's largest information technology services and consulting provider. Some 180,000 professionals in more than 160 countries help clients integrate information technology with business value -- from the business transformation and industry expertise of IBM Business Consulting Services to hosting, infrastructure, technology design and training services. Drawing on the unmatched scope and scale of IBM, IBM Global Services provides integrated, flexible and resilient processes -- across the company and through business partners -- to help customers take full advantage of e-business on demand, achieving cost savings and transforming their enterprises into more competitive businesses. For more information, visit www.ibm.com/service

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