04.30.10
HAMPTON, N.H. (April 30, 2010) The software market is in the midst of a recovery, fueled by growing customer confidence and pent-up IT demand. The recovery is illustrated by the return to revenue growth experienced by many of the vendors in TBR’s 4Q09 Software Business Quarterly (SBQ) Benchmark report. Among the companies covered in the report, average revenue increased 7.2% year-to-year, driven by the improving economy and year-end customer budget spending. Large software vendors led the way in terms of revenue, with Microsoft holding the top position, at $19,022 million, driven by the release of the Windows 7 operating system and rising PC shipments. IBM Software and Oracle came in at a distant No. 2 and No. 3, posting revenue of $6,577 million and $5,858 million, respectively.
“Revenue growth is certainly a positive sign for the software industry, but vendors will not be quick to return to the rapid expansion experienced in the pre-recession era,” said Senior SBQ Analyst Allan Krans. “Both vendors and customers remain cautious with investments and focus on tactical, not transformational projects. We expect systems management in this environment to be a key priority, both for cost reduction and to enable alternative cloud and appliance-based delivery models.”
The TBR report highlights that rising investment in management tools was evidenced by the rapid consolidation of the runbook automation space, capped by Microsoft’s purchase of Opalis during 4Q09. Software vendors have taken note of continued customer focus on IT cost reduction, and will likely continue to look to meet customer management requirements. In addition to enabling greater efficiency in existing IT operations, management and integration is a barrier for cloud adoption, and a growth opportunity for cloud enablement and appliance providers. The need for holistic management solutions will not be fleeting, and TBR expects additional acquisitions and investments over the next three years as vendors fight to provide customers a single point of control and enhanced automation capabilities.
TBR’s SBQ Benchmark report provides expert commentary on market trends, effective business models, resource investments and geographic differences, using almost 30 standard and proprietary metrics to analyze the performance of 33 companies. Companies covered by the SBQ Benchmark are: Adobe, Autodesk, BMC, CA, Check Point, Citrix, Compuware, CommVault, Epicor, EMC, HP Software, IBM Software, Informatica, Intuit, JDA, Lawson, McAfee, Microsoft, NetSuite, Novell, Open Text, Oracle, Red Hat, Sage, Salesforce.com, SAP, Software AG, Sybase, Symantec, Tibco, Trend Micro, Verisign and VMware.
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NOTE TO EDITORS: TBR is a market research and industry advisory firm; we are industry analysts covering high-tech firms from a combined business, financial and technical perspective. Example source description: Ezra Gottheil (ezra.gottheil@tbri.com), Senior Analyst with industry advisory firm, Technology Business Research, Hampton, NH. You have permission to quote directly from comments included in this document.
Technology Business Research, Inc., headquartered in Hampton, N.H., is recognized as one of the leading high-tech market research and consulting firms specializing in the analyses of computer, software, networking equipment, wireless, portal and professional services companies, as well as customer satisfaction studies. Serving a domestic and international clientele of high tech manufacturers, IT professionals, end users and financial executives, TBR provides timely and accurate market research and business intelligence in a format that is uniquely responsive and tailored to clients’ needs. TBR analysts are available to further address client specific issues or information needs on an inquiry or proprietary consulting basis.