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  • Enterprise Software Spending to Rise 4.5 Percent This Year

    September 27, 2010 Timothy Prickett Morgan

    The global enterprise software market is on the rebound this year after taking it on the chin thanks to the Great Recession last year. According to the analysts at Gartner, worldwide software sales across all categories will come to $232 billion in 2010, up 4.5 percent from last year’s spending levels.

    Gartner is projecting that software spending will rise even faster in 2011, up 6.3 percent to $246.6 billion, and is projecting for sales to hit $297 billion by 2014. This represents a compound annual growth rate of 6 percent over the six years running from 2009 through 2014.

    “After declining 2.6 percent in 2009, the worldwide market for enterprise software is recovering well with signs of continuing growth on the horizon,” said Joanne Correia, a managing vice president at Gartner who tracks software spending, in a statement accompanying the projections. “Aging systems, as well as greater demand for security and aligning software with business requirements, are key decision factors for end users increasing their spending within the infrastructure software market.”

    Gartner reckons that enterprise software spending in North America will rise by 8.5 percent, to $110.8 billion, this year and will continue to grow through 2014 until it hits $143.6 billion. Software sales in the United States and Canada were front-loaded, showing pent up demand in 2010 and growth is expected to slow in the second half of the year. (The PC market had the same ricochet curve and I suspect the server racket will eventually follow a similar curve once the virtualization boom goes bust.)

    Software sales in Europe, the Middle East, and Africa are still not out of the woods and are projected to fall by 3.4 percent, to $64.5 billion; sales are nonetheless expected to eventually recover and hit $76.2 billion by 2014. Western Europe is finding its legs in terms of enterprise software spending, but Eastern Europe is volatile, according to Gartner. Germany and France are leading a recovery in spending for software, with the United Kingdom and the Nordic countries doing alright, but Portugal, Ireland, Greece, and Spain–the so-called PIGS–are struggling. Sometimes Italy is thrown into the mix to make the PIIGS.

    The Asia/Pacific region, which includes China and India but not Japan, is expected to grow 13 percent, to $22 billion, this year, balancing out some of the decline in Europe but clearly, for all its growth, the AP region is a lot smaller than the EMEA region when it comes to enterprise software and is utterly dwarfed by North America.

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    Tags: Tags: mtfh_rc, Volume 19, Number 34 -- September 27, 2010

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TFH Volume: 19 Issue: 34

This Issue Sponsored By

    Table of Contents

    • Power 720: Same Entry Price, But More Room to Grow at Less Cost
    • Microsoft Technologies Gaining Ground in the IBM Midrange
    • IBM Offers Sun, HP Shops Generous Leases–What About iSeries Shops?
    • As I See It: Of Better Jobs and Billy Joel
    • Oracle Gets Systems Design, and Starts Proving It
    • iManifest U.S. Looking for a New Spearhead
    • IBM Does A Little Power Systems Marketing After All
    • Netezza Needs IBM, But Why Does IBM Need Netezza?
    • IT Budgets at SMBs Up a Smidgen in 2H10, Survey Finds
    • Enterprise Software Spending to Rise 4.5 Percent This Year

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