The library automation marketplace is characterized by five significant realities. The first is the changing status of vendors in the marketplace. The development of capabilities and the support of installed systems compete for the same corporate resources, resulting in an evolution in the leadership position of vendors. Second, the market is polarized, containing experienced institutions that are replacing systems and institutions that are entering the market for the first time. Communication within the marketplace is intense, which can contribute to the success of a project; the peer network also can increase the chances of replicating older, proven technologies while making it more difficult for new vendors to enter the marketplace. The institutions that comprise the marketplace are extremely slow to develop their plans and commit their resources. The library automation marketplace is also very small and relatively poor. Library automation vendors must recognize and contend with these realities.