Software Market

Market Overview:

The global software market size reached US$ 636.4 Billion in 2023. Looking forward, IMARC Group expects the market to reach US$ 1,083.6 Billion by 2032, exhibiting a growth rate (CAGR) of 6.09% during 2024-2032. The increasing shift toward digital transformation, rising adoption of mobile devices and remote work options, escalating demand for customization, and growing security and privacy concerns, are some of the major factors propelling the market growth.

Software refers to a collection of instructions, programs, and data that enable computers and electronic devices to perform specific tasks or functions. It is a set of intangible components that govern the behavior and functionality of hardware. Software is typically written in programming languages and encompasses applications, operating systems, drivers, and other software components. It can be categorized into system software that manages computer resources, and application software that serves specific purposes for users. Software is created through a process of coding, testing, and debugging, and it can be modified or upgraded to enhance performance, add new features, or fix issues. Its pivotal role in computing enables computers to execute various tasks and provide valuable services to users.

The increasing shift toward digital transformation across industries is a significant factor driving the market. Organizations are investing in software to automate processes, streamline operations, enhance customer experiences, and gain a competitive edge. Additionally, the rising penetration of mobile devices and remote work options has encouraged several  companies to adopt software solutions to support remote teams, enhance productivity, and ensure secure remote access. Other than this, the SaaS model offering software on a subscription basis through the cloud, has gained immense popularity as it provides cost-effective, scalable, and easily accessible software solutions, eliminating the need for extensive infrastructure investments. Besides this, businesses and users are demanding more tailored software solutions to meet their specific needs. Customizable software enables organizations to address unique challenges and gain a competitive advantage.

Software Market Trends/Drivers:

Rapid Digital Transformation

Digital transformation drives the software market by creating a demand for software solutions that enable organizations to modernize their operations and leverage digital technologies. As businesses seek to improve efficiency, streamline processes, enhance customer experiences, , they require software for automation, data analytics, cloud computing, and collaboration tools. Digital transformation initiatives need software to integrate systems, enable seamless data sharing, and provide insights for informed decision-making. As a result, there has been extensive investments in software development, innovation and implementation.

Increasing Adoption of Mobile Devices

The rise of mobile devices and remote work drives the software market by creating a demand for software solutions that enable seamless communication, collaboration, and access to data from anywhere. With the increasing adoption of mobile devices and the shift toward remote working, organizations require software that supports remote teams, enhances productivity, and ensures secure remote access. This has further escalated the for mobile applications, collaboration tools, and remote work software solutions. The software market responds by providing innovative solutions that cater to the needs of a mobile and remote workforce.

Introduction of SaaS Model Offering Software on a Subscription

The SaaS (Software as a Service) model, offering software on a subscription basis, is propelling the software market by revolutionizing the way software is delivered and consumed. The SaaS model provides numerous benefits such as cost-effectiveness, scalability, easy accessibility, and reduced maintenance burdens for users. It eliminates the need for upfront infrastructure investments and offers flexible subscription plans. This lowers barriers to entry, making software more accessible to businesses of all sizes. SaaS also enables rapid deployment, updates, and support, enhancing user experience. The convenience and flexibility of the SaaS model have led to increased adoption, driving the growth of the software market as more companies and individuals choose subscription-based software solutions over traditional licensing models.

Software Market Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the global software market report, along with forecasts at the global, regional, and country levels from 2024-2032. Our report has categorized the market based on type, deployment mode, enterprise size, and industry vertical.

Breakup by Type:

• Application Software
  • Enterprise Resource Planning (ERP)
  • Customer Relationship Management (CRM)
  • Supply Chain Management (SCM)
  • Enterprise Collaboration Software
  • Enterprise Content Management (ECM) Software
  • Education Software
  • Others
• System Infrastructure Software
  • Network Management Systems (NMS)
  • Storage Software
  • Security Software
• Development and Deployment Software
  • Enterprise Data Management (EDM)
  • Business Analytics and Reporting Tools
  • Application Servers
  • Integration and Orchestration Middleware
  • Data Quality Tools
• Productivity Software
  • Office Software
  • Creative Software
  • Others
     

Application software dominates the market

The report has provided a detailed breakup and analysis of the software market based on the type. This includes application software [enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM), enterprise collaboration software, enterprise content management (ECM) software, education software, and others)], system infrastructure software (network management systems (NMS), storage software, and security software), development and deployment software (enterprise data management (EDM), business analytics and  reporting tools, application servers, integration and orchestration middleware, and data quality tools), and productivity software (office software, creative software, and others). According to the report, application software represented the largest segment.

Application software propels the software market by addressing specific needs and providing solutions for various industries and user requirements. Application software, including productivity tools, enterprise resource planning (ERP) systems, customer relationship management (CRM) software, and specialized applications, enables organizations to streamline processes, improve efficiency, and enhance productivity. It offers functionalities tailored to specific tasks, industries, or user roles, making it indispensable for businesses. The continuous demand for application software drives innovation and competition, encouraging software developers to create new and improved solutions. As businesses seek to optimize their operations and stay competitive, the demand for application software remains high, sustaining the growth and expansion of the software market.

Breakup by Deployment Mode:

• On-premises
• Cloud-based
   

On-premises hold the largest share in the software market

A detailed breakup and analysis of the software market based on the deployment mode has also been provided in the report. This includes on-premises and cloud-based. According to the report, on premises accounted for the largest market share.

On-premises deployment drives the software market by catering to organizations that require full control, customization, and data privacy. With on-premises software, companies can host and manage applications within their own infrastructure, giving them direct control over security, data storage, and configuration. This deployment option is favored by industries with strict compliance regulations, sensitive data, or specific infrastructure requirements. On-premises software vendors continue to innovate by offering advanced features, integrations, and support, attracting businesses that value self-management and customization capabilities. As a result, on-premises software sustains its relevance, driving the software market by meeting the needs of organizations that prioritize control, data privacy, and tailored solutions.

Breakup by Enterprise Size:

• Small and Medium-sized Enterprises
• Large Enterprises
   

Software is mostly used by large enterprises

A detailed breakup and analysis of the software market based on the enterprise size has also been provided in the report. This includes small and medium-sized enterprises and large enterprises.  According to the report, large enterprises accounted for the largest market share.

With their scale and complexity, large enterprises require robust software to manage and optimize their operations across various departments and functions. They often have higher budgets for software investments, leading to increased demand for enterprise-level software solutions. Large enterprises also serve as early adopters of emerging technologies, driving innovation and pushing software vendors to develop cutting-edge solutions. Their requirements for scalability, integration, security, and customization prompt software vendors to continuously enhance their offerings, driving competition and growth in the software market.

Breakup by Industry Vertical:

• IT and Telecom
• BFSI
• Retail
• Government/Public Sector
• Energy and Utilities
• Healthcare
• Others
   

IT and telecom represent the largest industry vertical

A detailed breakup and analysis of the software market based on the industry vertical has also been provided in the report. This includes IT and telecom, BFSI, retail, government/public sector, energy and utilities, healthcare, and others. According to the report, IT and telecom accounted for the largest market share.

IT department rely on software for infrastructure management, network administration, cybersecurity, and application development. Telecom companies require software to manage their networks, billing systems, customer support, and emerging technologies like 5G and IoT. The continuous advancements in IT and telecom are accelerating the product demand that can support their evolving needs. Furthermore, these industries serve as early adopters of new software technologies and drive innovation through their investments. Moreover, the dynamic nature of IT and telecom sectors fuels the growth of the software market by fostering new opportunities and driving the development of advanced software solutions.

Breakup by Region:

• North America
  • United States
  • Canada
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Others
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

North America exhibits a clear dominance, accounting for the largest software market share

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Europe (Germany, France, the United Kingdom, Italy, Spain, and others); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. According to the report, North America was the largest market for software.

North America drives the software market through its strong presence in technology companies, robust investment ecosystem, and high adoption rates of software solutions. The region is home to major tech hubs like Silicon Valley, Seattle, and Boston, attracting top talent and fostering innovation. North American enterprises, spanning various industries, heavily rely on software to improve operations, enhance productivity, and gain a competitive edge. The region's advanced IT infrastructure, favorable business environment, and access to capital contribute to the growth of software companies and startups.

Competitive Landscape:

The key players are heavily investing in research and development (R&D) to introduce cutting-edge technologies, improve existing products, and meet evolving customer demands. Additionally, they actively engage in strategic partnerships and collaborations to expand their market reach, access new technologies, and leverage complementary strengths. These partnerships enable them to offer comprehensive solutions and enter new markets. Moreover, they prioritize customer-centric approaches, thus continuously enhancing user experiences and providing timely support and updates. Moreover, key players invest in marketing and sales activities to promote their software solutions and increase market awareness. This includes digital marketing, participation in industry events, and targeted sales efforts. Furthermoe, they engage in mergers and acquisitions to gain market share, acquire talent, and diversify their product portfolios. These efforts by key players contribute to the overall growth and dynamism of the software market.

The report has provided a comprehensive analysis of the competitive landscape in the global software market. Detailed profiles of all major companies have also been provided. Some of the key players in the market include:

• Adobe Inc.
• International Business Machines Corporation
• Intuit Inc.
• McAfee Corp.
• Microsoft Corporation
• NortonLifeLock Inc.
• Oracle Corporation
• SAP SE
• Synopsys Inc.

Recent Developments:

• In 2023, McAfee Corp. focused on feature changes in McAfee security software for Windows. The strategic decision to change the default behavior of some features in security products for Windows, such as LiveSafe and Total Protection, is to review and adjust product portfolio to meet the needs of its customers.
• Oracle Corporation has launched Oracle Database 21c, available for production use as an innovation release provides an early insight into the many enhancements and new capabilities. These include autonomous administration, improved multi-model support through in-database Javascript and native blockchain tables, and multi-workload improvements, such as AutoML, and sharing enhancements that will be incorporated into future long term releases.
• Adobe Inc. has integrated Firefly directly into Photoshop, enabling the speed and ease of generative AI with the power and precision of Photoshop. This is the start of the company’s major initiative to integrate generative AI into existing creative workflows across Creative Cloud, giving users a creative co-pilot to accelerate ideation, exploration and production.

Software Market Report Scope:

Key Questions Answered in This Report:

• How has the global software market performed so far, and how will it perform in the coming years?
• What are the drivers, restraints, and opportunities in the global software market?
• What is the impact of each driver, restraint, and opportunity on the global software market?
• What are the key regional markets?
• Which countries represent the most attractive software market?
• What is the breakup of the market based on the type?
• Which is the most attractive type in the software market?
• What is the breakup of the market based on the deployment mode?
• Which is the most attractive deployment mode in the software market?
• What is the breakup of the market based on the enterprise size?
• Which is the most attractive enterprise size in the software market?
• What is the breakup of the market based on the industry vertical?
• Which is the most attractive industry vertical in the software market?
• What is the competitive structure of the global software market?
• Who are the key players/companies in the global software market?

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the software market from 2018-2032.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global software market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the software industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.