Software market positioned for strong growth

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The worldwide packaged software market is well positioned for strong growth. A recent IDC forecast* indicates revenues will increase at more than 15% through 2004 – with CRM projected at 30+%.

“Global economic growth, e-business Internet strategies, enterprise-to-enterprise supply chain support, and cybersmart computing continue to drive revenue growth,” said Tony Picardi, senior vice president of IDC global software research.

Application development and deployment software, the smallest segment of the market, will be the fastest growing. Its revenues will increase at near 20% from $36.5 billion in 1999 to $90.2 billion in 2004.

“As strategic business initiatives are turned into well-defined, well-executed web strategies, demand for application development and deployment software tools will increase,” said Stephen Hendrick, vice president of IDC application development and deployment research.

Despite the high growth rate, application development and deployment software will remain the overall market’s smallest segment.

Applications is the largest and most fragmented segment of the software market. IDC expects its revenues will increase at the slowest pace, just over 12%. However, this overall number masks the 30%+ growth anticipated in submarkets such as CRM, product information management, content and document management, and business performance management.

Worldwide revenue will hover around 15%. However, North America, packaged software’s largest market, will increase slightly faster than other regions with 15.5%. North America will account for more than half the market’s revenues.

In terms of operating environments, the big news is Linux. IDC expects strong growth, especially in the applications development and deployment software segment. Here, Linux’s revenues will increase at almost 183%. Despite the strong growth, Linux’s revenues will still be dwarfed by 32-bit Windows.

*Worldwide Software Market Forecast Summary, 2000-2004 (IDC #W22766).

IDC

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