Software Publishing in Canada Industry Market Research Report Now Available from IBISWorld

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Acquisition activity will become more robust over the next five years as continued technological development and innovation lead to new products. For these reasons, industry research firm IBISWorld has added a report on the Software Publishing industry to its growing industry report collection.

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Mobile devices will continue to open up entirely new platforms for software publishers

The Software Publishing industry has held steady in the five years to 2013; despite year-on-year fluctuations, industry revenue is expected to experience 0.0% annualized growth during this period, says IBISWorld industry analyst Dale Schmidt. In 2013, IBISWorld expects revenue to grow 3.3% to $6.7 billion as businesses and consumers step up their investments in software, computers and smartphones. As the global economic recession hit in 2009, businesses curtailed investment in software in the face of falling revenue; these cutbacks resulted in an 11.4% revenue decline for software publishers in 2009. However, operators had little trouble staying profitable. Companies maintained profit margins despite the increasing presence of software piracy. Publishers also made use of their downtime during the recession by focusing on strategic acquisitions and product development.

During the past five years, large software publishers eagerly bought smaller publishers with specialties in growing software niches. For example, Oracle Corp. acquired long-standing industry operator Sun Microsystems. Microsoft Corp. was similarly aggressive, acquiring a number of companies that developed software relevant to search engines and web-based software platforms, such as Skype in 2011. These acquisitions were necessary for firms to compete in an increasingly diverse array of software platforms. Acquisition activity will become more robust over the next five years as continued technological development and innovation lead to new products. The Software Publishing industry has a low level of market share concentration, with the two major players being Microsoft Corporation and Oracle Corporation Canada Inc. Some business customers are looking to reduce the complexity of their IT infrastructure and drive efficiency with fewer IT suppliers, says Schmidt. The largest companies usually achieve these goals through a combination of internal development and acquisitions, such as Oracle's 2009 acquisition of Sun Microsystems. Due to the varied nature of the software market, other than Microsoft, no single company dominates software publishing as a whole. The size of Microsoft's market share is due to its leading role in the operating system, business analytics and video game software segments. Other software publishers, however, focus on only one or two industry subsegments. As a result, their market share for software publishing is relatively small, leading to a low market share concentration for the industry. Concentration varies widely by market segment. It is typically high in the operating system and middleware segments, but relatively low in the large applications segment. Categories within the applications segment can be highly concentrated as well. For example, the important relational database market has about 90.0% penetration from only a few companies (IBM, Oracle and Microsoft).

Improving technologies, particularly those related to semiconductors and telecommunications, and the rise of emerging economies abroad will expand the potential markets for software publishers in the next five years. Furthermore, mobile computing devices, from cell phones to tablet computers, will continue to open up entirely new platforms for software publishers. In addition, companies will move toward cloud computing, which will allow mobile phones to be used like tablets, as they will no longer be hampered by their low storage capacity. Industry operators will also increasingly use subscription-based sales models, which will help stabilize cash flows. For more information, visit IBISWorld’s Software Publishing in Canada industry report page.

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IBISWorld industry Report Key Topics

Software publishers disseminate licences to customers for the right to execute software on their own computers. Publishers market and distribute software products but may also design the software, produce support materials and provide support services.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US and Canadian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.ca or call 1-800-330-3772.

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Gavin Smith
IBISWorld
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