Software - Hong Kong

Hong Kong

Revenue in the Software market is projected to reach US$2.08bn in 2024.
Enterprise Software dominates the market with a projected market volume of US$0.87bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2028) of 5.43%, resulting in a market volume of US$2.57bn by 2028.
In global comparison, most revenue will be generated in the United States (US$353.50bn in 2024).

Key regions: United States, Canada, Germany, China, Japan

Definition:

In general, software is defined as a set of instructions written as programming code to execute specific tasks on a computing device. The Software market covers a wide range of software products and solutions that are publicly sold by various companies. Most software solutions in this market are designed for professional use, but some can also be suitable for personal use. They can also range from basic productivity tools such as word processors and spreadsheets to complex software solutions such as project management tools, graphic design software, and enterprise resource planning software.

Products in the Software market can be obtained in two ways: as on-premises software that is sold via a transactional license or a subscription and as cloud-based software (software as a service/ SaaS) that is most frequently sold as a subscription.

Structure:

The market contains four markets that are based on the functionality of the software:

Productivity Software refers to application software that supports activities such as producing documents, spreadsheets, drawings, and presentations. This market includes Administrative Software, Collaboration Software, Office Software, Creative Software, and Construction and Design Software.
Enterprise Software refers to all software that supports essential large-scale business activities such as enterprise resource management, customer management, and supply chain activities. This market includes Enterprise Resource Planning Software, Customer Relationship Management Software, Business Intelligence Software, Supply Chain Management Software, Content Management Software, and Other Enterprise Software.
Application Development Software refers to software and tools that help the overall application development process.
System Infrastructure Software refers to software that provides the base framework for operating and managing organizational processes and services on hardware devices.

Additional Information:

The Software market comprises revenue and revenue change as the key performance indicators. Only revenues that are generated by primary vendors at the manufacturer price level either directly or through distribution channels (excluding value-added tax) are included, and revenues generated by resellers are excluded. Revenues are generated through both online and offline sales channels and include spending by consumers (B2C), enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players in this market include Microsoft, Adobe, SAP, Oracle, and Salesforce.

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Region

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Analyst Opinion

Hong Kong, known for its towering skyscrapers and bustling city life, has seen a steady growth in its software market over the years.

Customer preferences: As a hub for international business and finance, Hong Kong has a strong demand for software solutions that cater to these industries. This includes financial software for accounting and trading, as well as project management software for businesses. Additionally, with the rise of e-commerce and mobile applications, there is also a growing demand for software solutions that provide online shopping platforms and mobile app development.

Trends in the market: One of the notable trends in the software market in Hong Kong is the shift towards cloud-based solutions. More and more businesses are adopting cloud-based software for their operations, as it allows for easier accessibility and better collaboration among teams. Another trend is the increasing use of artificial intelligence and machine learning in software solutions, particularly in the finance industry. This technology allows for more efficient data analysis and decision-making processes.

Local special circumstances: Hong Kong's status as a Special Administrative Region of China also plays a role in the development of its software market. As a gateway to China, many software companies in Hong Kong focus on developing solutions that cater to the Chinese market. Additionally, Hong Kong's unique position as a bilingual city means that software solutions often need to be available in both English and Chinese.

Underlying macroeconomic factors: The growth of the software market in Hong Kong is also influenced by macroeconomic factors such as government policies and infrastructure development. The Hong Kong government has been actively promoting the development of the technology industry through initiatives such as the Innovation and Technology Fund. Additionally, the city's advanced telecommunications infrastructure and high level of digital connectivity make it an attractive location for software companies to set up their operations.In conclusion, the software market in Hong Kong is driven by the demand for solutions that cater to the city's thriving business and finance industries, as well as the rise of e-commerce and mobile applications. The shift towards cloud-based solutions and the increasing use of artificial intelligence and machine learning are also notable trends in the market. Hong Kong's unique position as a bilingual city and gateway to China, as well as government policies and infrastructure development, further contribute to the growth of the software market in the city.

Methodology

Data coverage:

The data encompasses B2B, B2G, and B2C enterprises, except for the Enterprise Software segment, in which consumer (B2C) spending is not considered. Figures are based on the allocation to the country where the money was spent at manufacturer price level (excluding VAT).

Modeling approach / Market size:

Market sizes are determined through a top-down approach with a bottom-up validation, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and reports from our primary research. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, level of digitization, GDP sector composition, and observed level of software piracy. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. The main drivers are the GDP and the level of digitization.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.