April 1, 2009 / 12:27 PM / 11 years ago

IBM to enter "cloud computing" software market

A worker prepares a stand of IBM for the upcoming CeBIT fair inside a hall in Hanover in this February 27, 2009 file photo. REUTERS/Hannibal Hanschke

BOSTON (Reuters) - IBM will sell a suite of Web-based collaboration software for businesses, including contact management, instant messaging and file sharing programs, the computing giant’s biggest effort to date to sell software as a service.

The move to be announced on Wednesday pits International Business Machines Corp against companies that are already established in the fledgling market for software as a service including: Microsoft, Google and privately held Zoho.

IBM will charge companies $10 to $45 per user per month for its software suite, which it will host at its own data centers and deliver via the Web, a company executive said in an interview on Tuesday. The suit will be available April 7.

“What you are seeing are the beginnings of the whole IBM company moving toward cloud computing,” IBM Vice President Sean Poulley said.

“Cloud computing” — one of the latest buzz words in Silicon Valley — refers to a variety of ways in which technology companies offer computing services over the Web from remote data centers, seemingly from the cloud of the Internet.

Tech research company Gartner estimates that the global market for cloud-based business software, computing services and storage will total about $10 billion this year. That remains a fraction of the $223 billion Gartner is projecting for the old-fashioned business software market alone.

Reporting by Jim Finkle

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