Global Software Market and the Software 500
Revenue at the Software Magazine's "2006
Software 500" declined 1% to $380.8 billion worldwide for 2005
from the previous year's total revenue of $383.3 billion. Total employees
at the 2006 Software 500 companies declined just under 5% to 2,539,872 at
the end of 2005.
Forrester Research estimates the global commercial software market at $207 billion in 2005, with the top four vendors accounting for about 34% of the revenue.
The magnitude of growth and structural
change in the enterprise software
industry over the next five years will be determined by clashes between the four horsemen of software
commoditization — service-oriented architecture (SOA), open source, software-as-a-service
(SaaS), and offshore development — and the four fortresses of market
inertia — vendor concentration, intellectual property rights, installed
bases, and brand loyalty, according to Forrester Research's
The
Future Of Enterprise Software. The four horsemen are changing how enterprise
applications are created, sold, implemented, and supported; the four
fortresses slow and limit these changes. The outcome of these clashes will
vary by software category, but overall prices
will decline and the industry overall will descend to historically low
growth rates.
