Enterprise software market rebounds with $245bn revenue in 2010

The enterprise software market has bounced back after a turbulent 2009, increasing total worldwide revenue by 8.5 per cent year on year to $245bn, according to the latest figures from Gartner.

The growth in revenue confirmed that the software market is recovering and expanding after sales declined in 2009 by 2.5 per cent, Gartner's Market Share Analysis: Enterprise Software Worldwide 2010 report noted.

Microsoft, IBM, Oracle, SAP and Symantec were the top five vendors, accounting for a combined 50.2 per cent of the market.

Microsoft maintained its position at the top with a share of 22.4 per cent and saw worldwide software revenue rise by $6bn year on year to $54bn. Gartner attributed this growth to the broad adoption of Windows 7 and Office 2010.

The firm continues to increase its market share by targeting organisations and offering multiple delivery models, Gartner said.

IBM came second despite its overall market share dipping slightly to 10.4 per cent. Gartner pointed out that IBM would have come out top if consumer sales of Microsoft's office suites and operating systems were not counted.

Big Blue's software revenue grew more than 5.7 per cent in 2010 to $25.4bn, mainly due to the WebSphere, Tivoli, Information Management and Rational brands. IBM also expanded its focus on e-commerce, marketing and sales applications as the company continued to evolve its Smarter Planet strategy.

Meanwhile, Oracle showed the strongest growth of the top five vendors, with revenue up by 19.4 per cent. All of the firm's software markets, including business intelligence, security, IT operations, data integration and quality tools, achieved growth.

Other standout performers among the top 25 vendors included VMware with 41 per cent growth, Adobe with 29 per cent and Salesforce with 28 per cent.

Software revenue from the top 25 vendors grew more than 11.5 per cent overall, and these vendors accounted for nearly 68 per cent of the market, or more than $165bn.

The major software vendors expanded their product portfolios in 2010, acquiring companies where appropriate to their plans, and reaching deeper into emerging markets, according to Joanne Correia, managing vice president at Gartner.

"The year represented a return to solid footing as the market recovered and expanded in terms of revenue and geographies," she said.

"However, some regions did not recover as rapidly as others. Japan and western Europe saw relatively modest dollar-denominated growth, while Latin America and Asia/Pacific saw growth in the mid-to-high teens, nearly double the market average."