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.
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.
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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Productivity software, such as Microsoft, Adobe, and Zoom
Enterprise software, such as Oracle, SAP, and ServiceNow
Application development software, such as Amazon Web Services (AWS), Squarespace, and Visual Studio
System Infrastructure Software, such as Cisco, Gen Digital, and McAfee
PC and gaming software, such as NVIDIA Corporation, Improbable, and Plug In Digital
Social networking, such as Facebook, Yammer, Twitter, and Zimbra
Free of charge software, such as Airtable, Anaplan, and BlackLine
Custom made applications, such as Sphinx Solutions, CHI Software, and Intellectsoft
India, known for its rapid technological advancements, has been witnessing a significant growth in the software market in recent years.
Customer preferences: The Indian software market is driven by the increasing demand for digital transformation across various industries. Enterprises are adopting software solutions to streamline their operations, improve efficiency, and reduce costs. Additionally, the growing trend of remote work due to the COVID-19 pandemic has also led to an increased demand for software tools that facilitate collaboration and communication.
Trends in the market: Cloud computing and Software as a Service (SaaS) are the two major trends that are driving the software market in India. The adoption of cloud-based software solutions has been on the rise due to their scalability, flexibility, and cost-effectiveness. SaaS-based solutions are gaining popularity as they enable businesses to access software applications over the internet without the need for expensive hardware and software infrastructure.Moreover, the demand for Artificial Intelligence (AI) and Machine Learning (ML) solutions is also growing in India. Enterprises are leveraging these technologies to automate their operations, improve decision-making, and enhance customer experience. The Indian government's push towards digitalization and the increasing use of smartphones have further accelerated the adoption of AI and ML solutions in the country.
Local special circumstances: India's software market is unique due to the presence of a large number of small and medium-sized enterprises (SMEs). These businesses have been adopting software solutions to improve their operations and compete with larger players in the market. The government's initiatives to promote entrepreneurship and innovation have also led to the growth of startups in the software industry.
Underlying macroeconomic factors: India's software market is expected to continue its growth trajectory due to various macroeconomic factors. The country's young and tech-savvy population, rising disposable incomes, and increasing internet penetration are driving the demand for software solutions. The Indian government's focus on promoting digitalization and the growth of the e-commerce industry are also expected to fuel the growth of the software market in the country.In conclusion, the Indian software market is witnessing significant growth due to the increasing demand for digital transformation, cloud computing, SaaS-based solutions, and AI/ML technologies. The presence of a large number of SMEs and startups, along with favorable macroeconomic factors, are expected to further drive the growth of the software market in the country.
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.
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.
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.