In a subtle shift from the days in which content was king, the International Data Corporation semiannual Software Tracker published this week reaffirms what we are now seeing on a daily basis -- that data is king. In this scenario though, data access and analytics software is the king-maker and this report makes that clear.
Data Is King
But there are many different kinds of content and to paraphrase Animal Farm, while all data is equal, some data is more equal than other data. Depending on where you’re coming from, this means that generally speaking, data that can be used to give a competitive edge with potential or actual customers rules the roost.
Leaving barnyard analogies aside, there is some really interesting material here. The first thing that can be said is that despite persistent global economic problems the world software market grew by 3.6% over the past year to reach US$ 342 billion. Even still, IDC points out, this is only half the growth rate of 2010 and 2011.
This, IDC adds, confirms that we have now entered a more conservative growth period -- although at the moment any kind of growth is good -- and PC makers will testify to that.
Within that 3.4% growth, though, there are huge variations with a number of segments growing dramatically faster than others.
The real winners here were: Data Access, Analysis and Delivery, Collaborative Applications, CRM Applications, Security Software, and System and Network Management Software.
All of these grew between 6% and 7% over the period, being nearly double the rate for enterprise software as a whole, while it is notable that information management and use is a key element in the higher growth areas:
Every one of these markets grew in the 6-7% range, about double the rate for enterprise software as a whole.
… The management and leveraging of information for competitive advantage is driving growth in markets associated with Big Data and analytics. Similarly, rapid growth in cloud deployments is fuelling growth in application areas associated with social business and customer experience. Both these initiatives require a reliable and secure infrastructure, driving investments in security and system/network management," said Henry D. Morris, senior VP at IDC.
Applications, AD&D, Infrastructure
In IDC’s analysis there are three principal segments: Applications, Application Development & Deployment (AD&D) and Systems Infrastructure Software.
By far the biggest growth was recorded in the the AD&D segment, which comprised nearly 24% of total software revenues in 2012, and grew by 4.6% over the year.
In the AD&D segment growth was driven largely by the performance of Data Access, analysis, as well as delivery and the structured data management market with 6% and 5.9% growth rates respectively.
Big Data and analytics adoption are pushing these markets through business intelligence and relational Database Management Systems (RDBMS).
But it's not the only area that is feeding into the big data phenomena. The growth in social business software that aligns contextual data with expertise has become a critical element in enterprise decision making as well as data driven customer experience management solutions.
In this space Oracle is dominant with a 21.6% share of the market, followed in order by IBM, Microsoft, SAP and SAS. Here, Microsoft and SAP had exceptional years with growth rates of one half of one percent year on year.
If AD&D has had the biggest growth rate, than applications has the biggest market share with 49% of total software revenue, even if its year-on year growth for 2012 was slightly lower at 3.3%.
Within that 3.3%, customer relationship management (CRM) software as well as applications for collaboration stood out with growth rates of close to seven percent. The CRM market, IDC says, is being driven by the cloud migration trend and the drive for better business through better customer experiences, while the latter is driven by the social enterprise collaboration market which grew by 24.8% and has grown by more than 5% over three years.
While mobile is not a direct enterprise application driver, it is a factor as more vendors develop mobile agnostic enterprise software.
Microsoft led the Applications primary market in 2012 with 13.7% of market share and was followed in order by SAP, Oracle, IBM and Adobe, with IBM showing the strongest growth as it builds its Middleware portfolio.
3. System Infrastructure Software
This made up 27% of the total software revenue and grew 3.3% over the year in 2012. The Security Software and System/Network Management Software secondary segments also grew, this time by 6%.
Storage Software and System Software demonstrated flat growth in 2012, while the virtualization experienced had double-digit growth rates. Microsoft again leads the pack here with 28% of the market shared followed by IBM, Symantec, EMC and VMware.
Regionally, figures for the overall market were overshadowed by economic events in Europe and the consequent downward trend. While Europe represented 26.5% of the worldwide market, it was the only region where negative growth occurred.
In the US, growth was in the region of 6.0% and made up more than 45% of the overall market while the areas of greatest growth were Saudi Arabia, Peru, China and Turkey.