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2014 Press Releases

July 03, 2014

Gartner says enterprise software shows steady growth in APAC

Analyst group Gartner estimates that the Asia Pacific Enterprise Application Software (EAS) Market grew 6.5 percent in 2013. The analyst also noted that the EAS market adoption has slowed, albeit, compared to 2012.

Gartner analyst, Yanna, right assesses this slowing growth to the combination of two factors: enterprise purchases span multi-years and so companies are still gestating over earlier purchases. Pressures to stretch investments mean IT is under scrutiny to extend the life of existing technology as long as possible. At the same time, with maturing understanding around cloud-based alternatives, companies are taking a cautious but forward approach to this new approach. Customer-centric applications will be at the top of the investment food-chain.

Over the long term, we can expect on-premises enterprise software investments around to continue to decline in favor of web-based, scale-out alternatives. It’s really just a matter of time.

PRESS RELEASE

The enterprise application software market in Asia Pacific (excluding Japan) grew by 6.5 percent in 2013 to reach US$12.6 billion, slightly lower growth than in 2012, according to the latest worldwide software market share results from Gartner, Inc.
Application software markets include enterprise resource planning (ERP), office suites, customer relationship management (CRM), business intelligence (BI), supply chain management (SCM), enterprise content management (ECM), digital content creation (DCC), web conferencing and project and portfolio management (PPM) software.

Countries in the region showed mixed performance. Australia stood out as the fastest growing market among the mature Asia Pacific countries driven by growth in CRM investments, BI and analytics, new spending on SaaS and cloud based deployments, as well as upgrades and improvements to continue the modernisation of established, mission critical software. Application software revenue in Australia totaled US$3.4 billion (A$3.5 billion) and grew 7.7 percent from 2012.

Meanwhile, China continued to face moderating growth due to slowing domestic and export market demand. In China, application software revenue reached US$3.1 billion (RMB 19.1 billion), an increase of 5.9 percent over 2012.

“The software industry is in the middle of a multiyear cyclical transition as organizations are focusing investment on technologies to support existing systems, in order to maintain competitiveness, while still taking advantage of cloud/subscription-based pricing where it makes sense to grow and advance the business,” said Gartner research director Yanna Dharmasthira.

The top five vendors in Asia Pacific (excluding Japan) remained stable, but their success and performance in various countries greatly varied.  ERP, CRM, office suites, and BI and analytics were the largest software markets.   These software segments also dominated in Australia, however, CRM played a bigger role in terms of share.

Table 1: Top 5 Enterprise Application Software Vendors, Asia Pacific (excluding Japan), 2012-2013

Vendor 2013 Share 2012-2013 Growth
Microsoft 23.6% 6.6%
SAP 12.1% 7.2%
Oracle 7.2% 0.7%
IBM 4.1% 0.9%
Yonyou 3.6% 1.1%

Source: Gartner (March 2014)

In Australia, the ranking is the same except for Salesforce.com in fifth place. The variation in the top five vendors in Australia compared to Asia Pacific overall reflects the differences in technology priorities between mature and emerging markets.  ERP is still the dominant software revenue contributor in many emerging countries, where local vendors played stronger roles, such as in China.