As sales grow, Cambridge-based Lotus adds products to fend off rival Microsoft

Less than a week after reporting massive sales growth, IBM Corp.'s Cambridge-based Lotus software division is introducing products designed to keep up the momentum and fend off archrival Microsoft Corp.

At today's Lotusphere trade show in Orlando, Fla., Lotus will show off the newest upgrades to its flagship Notes and Domino software for managing e-mail and workgroup information sharing. In addition, Lotus will introduce a pair of products that will use up-to-date "Web 2.0" features like wikis and blogs to help corporate teams work more efficiently.

"We provide, we believe, the industry's broadest continuum of collaboration, communication and content services," said Lotus vice president Ken Bisconti.

For years, Lotus Notes has seen Microsoft's competing Exchange messaging software seize an increasing share of the corporate messaging market. But during an interview at IBM Software's Cambridge office last week, Bisconti scoffed at a recent report from the market research firm Radicati Group, which found that Microsoft's Exchange software has a 33 percent share of the corporate e-mail market, compared to 21 percent for Notes.

"We're not losing share," Bisconti said. "We're gaining overall share."

Merely counting e-mail licenses, he said, does not indicate Lotus's greater strength in the market for complex collaborative applications, used by companies to help teams of employees work together. Without offering hard numbers, Bisconti said that Lotus remains the leader in collaborative computing.

Bisconti spoke one day before IBM released its 2006 financial results, which seemed to vindicate him.

IBM's software business generated $5.6 billion in sales for the fourth quarter, ended Dec. 31, a 14 percent increase over the same period in 2005. And though Lotus customers could have waited for the release of new products in 2007, fourth-quarter sales of Lotus products surged by 30 percent.

Laura DiDio , an analyst at Yankee Group in Boston, said Lotus's continued success was no surprise. "It's a good product," DiDio said. "They are keeping up with the advances in technology; they have the IBM service and support behind them. They have the IBM sales force behind them. They have the IBM marketing behind them. . . . If you're a customer and you don't have to change, why would you?"

Lotus aims to maintain its growth partly by embracing a variety of software and networking standards designed to make its products work better with each other, and even those of rivals.

For instance, Lotus today introduces Notes and Domino version 8, the first version of Notes and Domino to use a software architecture called Eclipse, which makes it simpler to add new features by writing compatible software components. Companies that use business management software from Germany's SAP, for example, will be able to easily write a program to plug SAP features into the Lotus Notes interface.

The new Notes will have smoother integration with Lotus's popular Sametime instant messaging software. It will include an RSS feed reader to let users automatically receive news feeds from favorite Internet information sites. And Bisconti said that the Notes user interface will get a significant overhaul, in response to frequent complaints that the software is often confusing and difficult to use.

IBM is also embracing blogs and wikis, two types of online knowledge repositories created on the fly by users.

Lotus Quickr , a content management system to help workers share information, will let people use team blogs and wikis to compile and exchange information. Instead of mailing data to one another, Quickr users will be able to link to shared libraries and move the data to a host of other programs, from Microsoft Office to Lotus Notes. Or they can syndicate the data to other people inside or outside of the group, using standard tools like RSS feeds.

Connections is a MySpace-like social networking system geared to the workplace, where users can store lists of Internet bookmarks and create blogs to share information with co-workers. Over time, workers using Connections will build up personal profiles that demonstrate their areas of expertise, making it easy to track down knowledgeable colleagues.

Lotus is even engaging its customers and business partners in a virtual Lotusphere -- an electronic re-creation of the actual trade show, set in a neighborhood in the popular Internet community Second Life. Beginning tomorrow, Second Life members will be able to visit the virtual trade show and chat with IBM technologists and fellow users of Lotus products, without having to travel to Orlando. IBM isn't new to Second Life. Last year, CEO Sam Palmisano held a corporate town meeting in the real Chinese city of Beijing, as well as in Second Life. But this is the first time the company has attempted an online trade show.

Hiawatha Bray can be reached at bray@globe.com.