India to be third fastest growing enterprise software market by 2016

by CXOtoday Staff    Apr 04, 2012

Increased spending in the areas of operating systems, DBMS, AIM and application development will result in the fast growth of the market, says Gartner.

India’s enterprise software market is forecast to maintain its strong performance, with an estimated compound annual growth rate (CAGR) of 13.6 percent from 2009 to 2016, the third highest growth rate in the world, according to Gartner.

Priority areas of software spending include operating systems, DBMS, AIM and application development. In the next five, the fastest-growing segments will be Web conferencing and team collaboration, enterprise content management, CRM and ERP.

“Indian enterprises are lagging behind in terms of adoption of these tools, resulting in the fast growth of these markets,” the report said.

The research firm said that the enterprise software market in India is projected to grow 13 percent in 2012, as revenue reaches $3.22 billion USD in 2012.

In 2012, India will be the fourth largest enterprise software market in Asia/Pacific. The country is forecast to account for 11 percent of the region’s total revenue of $29.33 billion USD for Asia/Pacific this year, the equivalent to 1.15 percent of the total worldwide software of market share of $280 billion USD billion.

“The primary drivers of growth have been domestic demand, the growing maturity of users and incremental enhancements in the technology,” said Asheesh Raina, Principal Research Analyst at Gartner.

He added that India also enjoys a rich presence of all international software and hardware providers, backed by a very strong ecosystem of system integrators, service providers and business partners. “A combination of high domestic demand, presence of global vendors and entry of new small vendors with innovative products have made the overall ecosystem apt for robust growth.”

The report said that by 2016, India’s share of the software market in Asia/Pacific is expected to reach 12.1 per cent, representing $5.4 billion in revenue, or 1.5 percent of total worldwide software market revenue of $361 billion.