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Study: Majority of e-services providers to leave the stage by 2004

Toronto and Stamford, CT   August 15, 2001  According to a study by Gartner Inc. only 20 percent of e-services providers will survive industry consolidation by 2004. Enterprises implementing e-services should be wary of suppliers that may fall prey to mergers, acquisitions and outright business failure.

One of the chief contributors to market consolidation is that less than 45 percent of vendors offer solutions that provide three or more critical e-services components. Even those suppliers often lack integration between the critical components. The study notes that by 2004, the surviving 20 percent of e-services suppliers from the 2001 market will have acquired or implemented new components, enabling them to provide a complete and integrated solution.

A related Gartner study points out that only 15 percent of e-services implementations will successfully balance enterprise and customer needs by 2003. Today's e-business suites will be outdated and ready for replacement within the next two to three years, thereby affecting return on investment and total cost of ownership. IT operations that fail to implement e-services properly will experience a rise in total cost of ownership because of underutilization of new systems and excessive maintenance costs for existing systems.

"Implementing e-services is a central strategic imperative for IT," according to Esteban Kolsky, senior research analyst for Gartner. "This is one undertaking in which one cannot overplan implementation, nor overexamine the future of each e-services suppliers."

Gartner defines "e-service" as including the processes, policies, procedures, people, tools and technologies that enable enterprises to provide assisted and unassisted customer service using the Internet as a platform. The primary components in an e-service implementation could include e-mail response management, interactive chat, FAQ capability, Voice over IP (VOIP), collaborative tools and self-help or self-service.