Look for a strong global economy in 2007, "though still not evenly distributed." That's one of five predictions by Bruce Richardson, chief research officer with Boston, Mass.-based AMR Research Inc. He is basing his outlook on conversations with several executives of major software and automation providers. SAP AG, for example, is expecting double-digit growth in revenues, led by the U.S. and Asia. "SAP's optimism is a good omen for the enterprise software market," Richardson writes. According to the chief executive officer of one well-known industrial automation company, Asia and Latin America will be engines for continued growth in the coming year. Anecdotally, Richardson points to a sharp increase in worldwide hotel prices and airfares, a sign of strong demand.

On the software side, Richardson undercuts some of the excitement over service-oriented architecture (SOA). The new technology platform for uniting disparate systems within an organization is catching on, he says, but gradually. The largest application customers of SAP and Oracle Corp. "are in little or no hurry to explore the wonder of Web services," a prime mover behind the growth of SOA. Still, he believes the big vendors will push their largest accounts to adopt some form of SOA in 2007.

Other predictions or observations from Richardson for the coming year: SAP and Workday, the latter a new company formed by PeopleSoft founder Dave Duffield, will push the "model-based" approach to creating and modifying software. The result will be a new generation of on-demand and "do-it-yourself" business applications, based on a common development framework. Either Oracle or IBM will jump on the open-source bandwagon, possibly through the acquisition of Ingres, possessor of an open-source database. The result could be a knockdown battle between the two industry giants for core ERP customers. Finally, Richardson wonders how companies will limit the use of flash memory sticks by individuals seeking to steal confidential business data or intellectual property. He cites the existence of Verdasys, a Boston-area company specializing in security applications. "Looking for software solutions seems like a smarter approach than a government ban [on flash drives]," Richardson says.

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