Cloud computing is increasingly helping to drive changes in the software market, which grew by 4.8 per cent during 2013.
This is according to industry analyst Gartner, which says software revenue increased to $407.3 billion (£244.7 billion) in 2013, up from the previous year’s figure of $388.5 billion. Growth was strongest in the developed economies but remained sluggish in emerging markets.
“The software market has been changing shape over the past five years, and cloud is driving the bulk of this change as software vendors acquire and provide applications and infrastructure technology to support the cloud and the Internet of Things movement,” said Joanne Correia, research vice president at Gartner. “A clear indicator of this is that for the first time we have a pure cloud vendor in the top ten.”
A multi-year cyclical transition in the software industry is currently occurring, according to Gartner, with more organisations investing in technologies to support existing system structure, in order to maintain competitiveness.
At the same time, firms are taking advantage of cloud or subscription-based pricing where it makes sense to grow and advance the business.
In the worldwide ranking of server vendors, Oracle took second spot for the first time, with total software revenue of $29.6 billion and capturing 7.3 per cent of the global market.
Microsoft occupied pole position, with revenue of $65.7 billion, up from $62 billion in 2012.
Meanwhile, Salesforce.com entered the top ten, making over $3.8 billion in revenue during 2013. It achieved the highest growth of all members of the top ten at 33.3 per cent.
John Rizzuto, research vice president and invest analyst at Gartner, said investors continue to evaluate vendors on the basis of revenue growth and market share gains.
He added that emerging technology markets in software, such as digital marketing and public cloud computing, are at such an early stage of development that investors tend to favour companies that adopt an aggressive approach to acquiring market and ‘mind’ share.
As the trend to embrace the Cloud continues, organisations need to provide their employees with clarity on how to safeguard the organisation’s operating environment and critical data.