By Julie Sullivan
Service, which went without saying in the age of leased mainframes, is back with a vengeance. Digital Equipment Corporation is one of the few manufacturers that didn't scale back its service divisions with the advent of the PC; Compaq does not even track its relatively insignificant service-generated revenues. Their proposed merger underscores the renewed importance of service in the high tech industry.
According to Forrester Research, that market will grow 144 percent to US$303 billion by 2002. While hardware and software remain top moneymakers, corporate demand for assistance and advice is making services a top priority. "It's becoming a check box you have to have in order to play in the Fortune 1,000," says Forrester's Jon Oltsik.
Services (% of Revenue)
1996 1997
| Netscape | 15.9% | 28.1%
| Oracle | 45.2% | 50.0%
| Digital | 42.6% | 44.8%
| Compaq/Digital (forecast) | 15.5%
| Compaq*
| Hewlett-Packard | 13.2% | 14.3%
| IBM (1997 estimate) | 21.1% | 24.6%
*Outsourced service revenues not tracked.
| ELECTRIC WORD
Services with a Smile
