By William Fellows
Intraware Inc is rapidly gaining traction as a leading portal for buying software, research, training and support services and today will pick up more top tier partners, Hewlett-Packard, Novell and Macromedia, whose applications it will add to its newly revamped web site. It will begin selling all Novell and Macromedia software and HP’s Firehunter network management applications.
It is also about to announce a European version of its service that for the first time will include a range of local competencies including local language, currency, training and support through partnerships. The company claims that 50% of its revenue also comes from outside of the US. Half of the portal’s 150,000 members are outside the US, 45,000 of them in Western Europe.
Intraware is riding on the crest of the business-to-business e- commerce wave being one of the earliest entrants and having one of the best known brands. Giga Information Group forecasts business-to-business e-commerce will be worth more than $300bn next year, (compared with $250m business-to-consumer sales), rising to over $800bn by 2002 ($500bn).
It counts its web software portal among the rapidly expanding group of companies providing vertical industry and procurement services on the web including Chemdex, Altra, E-steel and PlasticsNet.com as well as Ariba and CommerceOne. One of its hottest products is the Vignette web publishing software that accounted for $1m of revenue in the first six months of the relationship with the company. Others include content management programs, development tools, XML products, Bluestone and Allaire. Intraware takes a cut of between 10% and 40% on sales, with the average now somewhere over 25%. It has an IT Knowledge center with news and research with 40% generated in house, the rest outsourced. It also has the Intraware software shop; a maintenance, rental and upgrade service; and online training.
Its second quarter numbers due next Wednesday are expected to show a big leap over the first quarter revenue of $16.5m, up from $5m in the same quarter of the previous year. It says it already has this much revenue booked because its subscription model means revenue is accounted for by deferring it through the year. It claims 150,000 members and 3,299 customers paying an average of $16,000. 25% of those customers are repeat spenders. It compares that with Digital River which it claims has an average sale price of $51.
While Beyond.com and Buy.com offer the most obvious direct competition, Intraware says the biggest potential competition will come from companies such as Cisco Systems, which owns the router market and will be out to sell all of the software and services a user could conceivably need.
