Software Market Analysis

Software Market Overview

Software Market Size was valued at USD 576.9 Billion in 2022. The Software market Vertical is projected to grow from USD 645.6 Billion in 2023 to USD 1586.97 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 11.90% during the forecast period (2023 - 2032). Business process automation, digitization, and increased enterprise data volume, are the key market drivers enhancing the market growth.

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Software Market Trends

A surge in the volume of enterprise data is driving the market growth

Enterprise data volume growth, increased business process automation, and expanding digitization are the main market drivers. Additionally, expanding corporate size is encouraged by growing privacy and network security concerns. The COVID-19 pandemic had a positive impact on the global economy. Businesses were urged to build up software solutions and malware protection, detection, and mitigation techniques during COVID-19, which supported the market's growth. This resulted from rising concern over cyberthreats. Additionally, remote working became the new norm and increased productivity, and government funding for the creation of a society dominated by technology is promoting the market's growth. Protecting and securing individual computer devices, information systems, online conversations, transactions, and networks are the software's main goals. Security software performs a variety of tasks, including access control, data & network protection, and defence against viruses, intrusions, and other system-level security risks. The demands of remote working have raised spending on cybersecurity software.

With extremely sophisticated plans and methods of attack, software developers are retaliating. For instance, the technology behemoth Dell Inc. changed the security software of its storage portfolio PowerStore3 in May 2023 to assist businesses in embracing Zero Trust more swiftly. This security architecture only authorises known entities and model actions. With the security upgrades, organisations can forbid unauthorised alteration or removal of snapshots prior to their expiration date. It also enables storage administrators to manage access directly from PowerStore in order to quickly address security issues.

In recent years, software solutions have been widely used as a result of the expansion of e-commerce, technological developments like AI and IoT, and an increase in the number of linked devices. The development of advanced cybersecurity software, as well as innovative and diversified cybersecurity tools and solutions, is due to the sophistication and accessibility of malware and attack methods evolving throughout time. To protect its software from cybersecurity dangers, for instance, the Seattle-based business Stacklock raised USD 17.5 billion in May 2023. The corporation would be able to thwart assaults, lower risks, and ensure the integrity of its digital assets thanks to its investment in software security, which would enable it to establish end-to-end provenance throughout its software supply chain. Thus, driving the software market revenue.

Software Market Segment Insights

Software Type Insights

The Software Market segmentation, based on type, includes application software, system infrastructure software, development and deployment software, and productivity software. Application software segment dominated the global market in 2022. The expansion is being driven by the need for various software programmes created to accelerate and streamline company processes using cutting-edge IoT technologies and cloud-based solutions. The market study includes application software such as Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), Supply Chain Management (SCM), Enterprise Collaboration Software (ECS), Enterprise Content Management (ECM) Software, Education Software, and others.

Software Deployment Insights

The Software Market segmentation, based on deployment, includes on-premises and cloud. On-premises segment dominated the Software Market in 2022. The high proportion may be attributed to the significant demand for on-premises software as well as the strict security, compliance, and regulatory requirements. Sensitive data is not transferred by organisations to cloud service providers; rather, they keep it on-site. Additionally, having data on-site helps with data protection and monitoring while reducing dependency on external organisations. As a result, on-premises software is in great demand and holds a higher market share.

Software Enterprise Size Insights

The Software Market segmentation, based on enterprise size, includes small & medium enterprises and large enterprises. Large enterprises segment dominated the Software Market in 2022. Higher productivity, lower operating costs, improved data access, discovery, analysis, and visualisation, as well as improved customer involvement and satisfaction, are all credited with the growth.

Figure 1: Software Market, by Enterprise Size, 2022 & 2032 (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Software Vertical Insights

The Software Market segmentation, based on vertical, includes IT & telecom, bfsi, retail, government/public sector, energy & utilities, healthcare, and others. Others segment dominated the global market in 2022. A substantial percentage of this increase can be ascribed to the rising demand for software across a range of IT and telecom services, including network management and communication tools, customer relationship management (CRM) systems, and enterprise resource planning (ERP) software. The use of modern software solutions is required by the industry's promotion of the acquisition, use, and distribution of software goods and services. Businesses and individuals rely on software for a variety of tasks, including communication, data management, productivity, and automation, as a result of ongoing developments in IT and telecom technology.

Software Regional Insights

By region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. The North America Software Market dominated this market in 2022 (45.80%). Its expansion is aided by the widespread use of various software and the largest revenue generation in the area. The US is a significant actor on the global scene and has largely supported the software sector. Large companies and SMEs in the region expanded their investment in software solutions, which contributed to the creation of sizable revenue. Thus, the tightening of rules and regulations governing data security and privacy is what is driving regional market growth. In the coming years, Asia Pacific is expected to offer considerable market potential. Further, the U.S. Software market held the largest market share, and the Canada Software market was the fastest growing market in the North America region.

Further, the major countries studied in the market report are The US, Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 2: SOFTWARE MARKET SHARE BY REGION 2022 (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Europe Software market accounted for the healthy market share in 2022. This may be because local companies are utilising opportunities to employ technology to lower risks to business equipment rather than merely preserving their conventions and compliances. Additionally, more mobile and connected devices—which are extremely susceptible to endpoint attacks—are used in Europe than in any other region. The region is therefore expected to grow at the fastest CAGR throughout the course of the prediction. Further, the German Software market held the largest market share, and the U.K Software market was the fastest growing market in the European region

The Asia Pacific Software market is expected to register significant growth from 2023 to 2032. Leading businesses in the APAC region concentrate on expanding their investments, product portfolios, solution offerings, and strategic alliances to develop solutions that are both functionally sound and user-friendly. The two main nations making a substantial contribution to the high regional market generation are China and India. Moreover, China’s Software market held the largest market share, and the Indian Software market was the fastest growing market in the Asia-Pacific region.

Software Key Market Players & Competitive Insights

Leading market players are investing heavily in research and development in order to expand their product lines, which will help the Software market, grow even more. Market participants are also undertaking a variety of strategic activities to expand their global footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, Software Industry must offer cost-effective items.

Manufacturing locally to minimize operational costs is one of the key business tactics used by manufacturers in the global Software Industry to benefit clients and increase the market sector. In recent years, the Software Industry has offered some of the most significant advantages to medicine. Major players in the Software market, including IBM Corp., McAfee Corp., NortonLifeLock Inc., Microsoft, Oracle, SAP SE, Adobe Inc., VMware Inc., Block, Inc., and Intuit Inc, are attempting to increase market demand by investing in research and development operations.

Cisco Systems Inc. (Cisco) integrates intent-based solutions for networking, security, collaboration, apps, and the cloud. The business offers for sale controllers, access points, switches, modules, routers, and interfaces for wireless networks. The company's technology and tools let its clients manage extra network connections from gadgets, users, and other entities. Among the various industries that Cisco helps are oil and gas, financial services, government, healthcare, mining, sports, media, entertainment, retail, utilities, and transportation. It offers its solutions through its direct sales staff and channel partners, which include distributors, resellers, service providers, and system integrators. The corporation has business and operational presence throughout the Americas, Europe, the Middle East, Africa, Asia-Pacific, Japan, and China. Cisco is based in the American city of San Jose, California. Cisco Systems kept its promise to help clients streamline their IT operations by announcing new developments in cloud-managed networking in February 2023. With powerful new cloud management capabilities for industrial Internet of Things (IoT) applications, streamlined dashboards to integrate IT and OT operations, and flexible network intelligence to view and secure all industrial assets, Cisco offers a unified experience that truly fosters business agility.

Microsoft Corp. (Microsoft) offers a variety of software-related services, including development, licencing, and support. The company offers a wide range of server applications, desktop and server administration tools, video games, cross-device productivity tools, business solution tools, and operating systems. It also offers training and certification services. It also develops, manufactures, and sells hardware products like PCs, tablets, game consoles, and other cutting-edge technology. Among the many services the business provides are consulting, cloud-based solutions, and solution support. Microsoft markets, distributes, and sells its goods through original equipment manufacturers, distributors, resellers, online marketplaces, Microsoft stores, and other partner channels. The business has operations in the Americas, Europe, Asia-Pacific, Middle East, and Africa. The headquarters of Microsoft are located in Redmond, Washington, in the United States. In February 2023, Microsoft incorporated ChatGPT-like technology into its Bing search engine, transforming a far-behind Google Internet service into a novel way to communicate with AI. The software giant may have an advantage over rival internet companies in capitalising on the enthusiasm around ChatGPT, a service that has exposed millions of users to the promise of cutting-edge AI technology. This is thanks to the overhaul of Microsoft's second-place search engine.

Key Companies in the Software market include

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  IBM Corp.

  
  


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  McAfee Corp.

  
  


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  NortonLifeLock Inc.

  
  


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  Microsoft

  
  


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  Oracle

  
  


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  SAP SE

  
  


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  Adobe Inc.

  
  


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  VMware Inc.

  
  


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  Block, Inc.

  
  


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  Intuit Inc

  
  

Software Industry Developments

March 2023: The company claimed significant momentum in client cloud adoption in Asia for 2022 at its 2023 Asia ReConnect client Day hosted in Kuala Lumpur, Malaysia.

Software Market Segmentation

Software Type Outlook

• Application Software


• System Infrastructure Software


• Development and Deployment Software


• Productivity Software

Software Deployment Outlook

• On-premises


• Cloud

Software Enterprise Size Outlook

• Small & Medium Enterprises


• Large Enterprises

Software Vertical Outlook

• IT & Telecom


• BFSI


• Retail


• Government/Public Sector


• Energy & utilities


• Healthcare


• Others

Software Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  
  


• Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • South Korea
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• Rest of the World
  
  
  
  • Middle East
  
  
  • Africa
  
  
  • Latin America