NewsStrategy

The Asia-Pacific business software market will grow by 8.4% to hit US$46 billion this year, according to research firm Ovum. 

In a new study titled "AP Market Trends 2010 Business Software Forecasts", Ovum predicted that the business software sector will recover from the global economic downturn this year, adding that it recorded zero growth in 2010.

Ovum added that the business software sector will grow at a compound annual growth rate (CAGR) of 8.9% over the next four years, reaching revenues of US$65 billion in 2015. The strong growth is driven by exploding volumes of data, increased enterprise mobility, the transition to cloud computing models.

China and India will present as the emerging markets, but the markets in Japan, South Korea and Australia are expected to show strong single digit growths as well.

The information management software sector will experience the biggest increase in revenues of all the business software areas. This area will grow at a CAGR of almost 11% from 2010 to 2015, as businesses grapple with spiraling volumes of data and try to extract business value from them. 

Tim Jennings, Ovum chief analyst, said: "As the global economy continues its recovery, the emphasis of IT investment is moving on from the traditional area of back office automation and transaction processing, towards the exploitation of information to add value to the business.

"The volume of information within enterprises continues to grow at an astonishing rate and investment is needed both to manage this information, and to turn it into actionable intelligence, through technologies such as business intelligence and analytics." 

According to Ovum, Microsoft continues to be APAC's number one software company with more than 15% market share, immediately followed by IBM, Oracle and SAP.

Ovum principal analyst Richard Edwards said: "Microsoft is still a major player and market maker, with revenues of US$6.6 billion in 2010 in APAC. The company has gained huge mass and velocity over the past 20 years or so, and this looks set to sustain the company in the short and medium-term.

"However its level of innovation is not keeping pace with the rest of the market -- it is doing just enough to stay in the game, but is not a star performer," Edwards said.

Although information management software will experience the strongest growth, Ovum's figures show all the sectors will enjoy a healthy outlook. The security software market will grow by a CAGR of 10% from 2010 to 2015, while applications software will grow by a CAGR of 9.7% for the same period. 

Jennings said: "Organizations are breaking away from the shackles of desktop IT, and providing mobile workers with access to systems from any location and any device. The mobile revolution will generate strong demand for mobile applications, as well as for the development and management platforms to support this shift.

"Although it is still relatively early days for cloud computing, growth will accelerate over the next five years, as organizations move further towards a Software-as-a-Service model and take their data centers towards the hybrid combination of public and private cloud infrastructure. This will generate new demand for both infrastructure and application services," Jennings said.

The emerging markets will also make a substantial contribution to the strong growth the software sector is set to experience. Jennings added: "Emerging markets around the world have an insatiable appetite for technology-driven expansion, often unencumbered by the constraints of peers in mature markets."