Although we know have a feel for the structure of the .NET component market but need to add some numbers. This will flesh out the market share of the different players and help use decide where the money is to be made.
Sources of Information
Not being an accountant it took a little while before I worked out how to discover the two key pieces of information I wanted to know per company. Most of the companies are based in America and they are all privately owned. Luckily a little investigation revealed that the cheapest and quickest approach was to use the credit checking service from Dun and Bradstreet.
I used the cheapest option they offer which reveals just the turnover and number of employees for any private company based in America. If you are willing to pay more than you can get a wealth of information about a company including its past financial and credit history.
Component Suite Vendors
Before giving the numbers we have to be careful to note that the numbers are only a snapshot of the last figures released. They are useful for getting an idea of the relative size of turnover and number of employees, but financial numbers tend to vary and these may be a little out of date.
The results for the suite vendors were as follows:-
Employees/Revenue/Company
70 $17.4m Infragistics
35 $_3.0m Developer Express
12 $_0.4m Syncfusion
(unknown) ComponentOne
The Dun and Bradstreet source was unable to give any details for ComponentOne but the other three companies have some interesting results. We can clearly see that Infragistics are the number one in the market and also achieve an execellent level of revenue per employee.
Number 2 in our list is Developer Express, they have a healthy revenue but are making less than half the amount per employee of Infragistics. I would guess that Infragistics are making a nice profit and that Developer Express are making a small profit or breaking even.
If the numbers for Syncfusion are accurate then they are in pretty dire straits. The revenue they are pulling in is about enough to support 3 developers but with 12 they must be losing money hand over fist.
Syncfusion are an interesting case because they only started up 2 or 3 years ago as a set of developers that used to work on the Stingray set of controls aimed at C++ developers. I always thought the advertising they used was very poor and looked unprofessional. Combined with nothing in their set of components that actually stands out from the crowd and you can see why they are struggling to stay alive.
So can we estimate the size of the suite market? I would guess that the revenue for ComponentOne is about the same as Developer Express as they seem to be positioned at the same level on the ‘best sellers’ chart of www.ComponentSource.com. Adding up all the numbers gives us $17.4m + $3m + $3m + 0.4m = $23.4m.
If we add on a little for the smaller players and take into account the released figures are behind the current value we could pick a value of say $25m as a fair guide. We don’t need to be completely accurate, just a rough idea of the scale is enough.
We can conclude that Infragistics has the dominant position with 70% of the market, Developer Express and ComponentOne have 12% each and the rest is split between odds and sods.
Clearly we do not want to be entering this market. A company with the resources of 1 full time developer against a market leader with 70 and the other two players with about 35 each does not represent an oppourtunity.
Specialised Market Vendors
Charting
Employees/Revenue/Company
26 $3.0m SoftwareFX
_4 $0.6m Graphics Server
Dundas (unknown)
Grid
Employees/Revenue/Company
30 $4.4m Data Dynamics
20 $3.0m FarPoint Technologies
Now these results are more interesting. I have not tried to include every single vendor for each of these two categories but instead the bigger well known ones. For the charting area I tried to get the figures for Dundas but was unable to get the cheap report that I was willing to pay for. I would guess they are only slightly behind SoftwareFX in size.
If seems that to be a big player in one of these categories you need to be at a scale of around $3-4m and therefore will have around 20-30 employees. Each category also seems to have room for a couple of big players followed by a few smaller companies.
Conclusions
Stay away from the market for creating a whole suite as it has a dominant player that is making a profit margin way above anyone else. To compete against Infragistics you need not just superior technical components but also deep pockets to try and match the level of marketing and exposure they are currently buying.
Each category seems able to support a couple of leading providers and although the value of these specialised markets is smaller than the suites it is still significant. At least it is compared to being a one man and his dog outfit like myself.
The leaders in the existing categories are well established and have good domain knowledge and so completing head on will be very difficult unless I have something that is obviously a magnitude better.
Instead I conclude the best approach is to not compete head on with any of the existing vendors. Instead we need to either create a completely new category or at least have a significantly different approach to any existing vendor. We need to develop a reputation for excellence in one area and ensure that we have many features that are just not present in any other product. So if you want the cool features then you have to buy ours because you just cannot get it anywhere else.
So that will be our broad approach. a laser like focus in an area for which we will build a reputation as the area leader. Plus ensuring we innovate in that area so that there is no way to substitute another vendor’s product in place of our own. We do not want to compete on price but on capability.
Does that sound reasonable or do you read the market differently? This is your chance to provide feedback and prevent me falling into any obvious traps that you can see ahead!
