The Armonk, N.Y.-based computing giant on Thursday announced that it is expanding a vertical market-focused program it launched last year for ISVs to include VARs, consultants and system integrators doing business in federal, state and local government agencies, as well as in the fields of education, health care and life sciences.

Through the IBM PartnerWorld Industry Networks program, partners can get IBM support in all steps of the business cycle, from identifying sales leads to closing the deal to getting technical assistance in building a solution.

IBM, which dropped out of the application-development space in 1999, launched Industry Networks in February 2004 to give ISVs easy access to the vendor's resources, organized by industry. Through Web-based tools and company contacts, program members can call on IBM's marketing services, technical experts and industry-focused sales staffs to serve their customers.

Now the vendor is adding VARs, integrators and consultants because it recognizes that the business models of these companies is converging with that of software developers, said Brett Hansen, program director for ISV and developer relations at IBM.

"The hard boundaries that used to be between those types of companies are rapidly disintegrating," he said.

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Many companies that develop applications also perform integration services for their customers. In addition, Hansen said, VARs, integrators and consultants have been requesting the type of assistance and vertical-market focus that IBM has made available through Industry Networks.

The vertical market strategy is a recognition of current market requirements.

"What we're hearing when we engage an end-user customer is they're not looking for a generic solution very often," Hansen said. "What they're looking for is solutions that truly solve an industry-specific problem."

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In expanding Industry Networks, IBM is focusing first on government, health care and education, as opposed to the full spectrum of vertical markets, in an effort to avoid missteps.

"We're going to make sure we're going to do this right in those three industries, and then we'll expand into other industries," Hansen said.

In addition, focusing first on the public sector opens opportunities for channel partners in a fast-growing IT market that, according to IBM, is growing at a 5 percent yearly clip and will top $210 billion next year.

Government agencies are turning to technology to meet the demands of declining budgets, school districts are under pressure to teach technical skills, and health care and life sciences customers need technology for safe health care and drug research.

"Public sector touches citizens' most important needs–sound and effective government, quality education and more effective patient care," said Robert Samson, general manager of IBM's public-sector business.

Hansen said Industry Networks has proven more successful in attracting ISVs than IBM had anticipated. The company had hoped to enlist 1,000 partners at the end of 2004, but the number who joined exceeded that goal and now stands at 3,000, he said.

"We have been absolutely thrilled with the response we've received in the industry," he said.

One of the partners that joined Industry Networks is San Francisco-based Actuate Corp., which develops business intelligence applications. The company has been an IBM partner for about three years and enlisted in Industry Networks last fall.

Bill Bush, IBM Global Alliance manager at Actuate, said the program has proven so successful that Actuate is enhancing its commitment to the IBM brand. "We're increasing my team from basically me to four people."

He said IBM has made sales and marketing resources available to help successfully drive sales of Actuate solutions integrated with IBM technology. For instance, Actuate marketers have created promotional materials about the company's software and IBM passed them on to its sales representatives.

When Actuate has a sales lead, the company contacts IBM through the vendor's Web-based Sales Connections tool, and usually within 72 hours, someone from IBM responds to work together with Actuate on closing the deal.

"They make it easy to do business with. They're making it much easier to do business," Bush said.

Hansen calls Sales Connections the "crown jewel" of Industry Networks. After the partner fills out an online form with details of the prospective deal, IBM finds the right person to work with the partner on seeing the sale through.

In cases when Industry Networks members need technical expertise or geographic reach they don't have, IBM is facilitating partnerships between them. To promote partnering, IBM has organized periodic events to bring partners together and steer them toward current market opportunities.

"We call this Industry Networks," Hansen said. "The idea here is that it's a network of partners working with IBM and working with one another."

To attract public-sector partners, IBM has special offers and rebates for ServerProven and TotalStorage Proven solutions, marketing consulting services, help from IBM sales representatives to close sales, and market research to help partners develop their message for customers.