Software Publishing in the US Industry Market Research Report from IBISWorld has Been Updated

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The Software Publishing industry experienced dynamic growth in the five years to 2013, and it is expected to grow in the current year as businesses and consumers step up their investments in software, computers and smartphones. For these reasons, industry research firm IBISWorld has updated a report on the Software Publishing industry in its growing industry report collection.

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Subscription as a service will help stabilize cash flows

The Software Publishing industry experienced dynamic growth in the five years to 2013, and is expected to achieve an annualized revenue increase of 4.3% to $189.5 billion. In 2013, IBISWorld expects revenue to grow 2.0% as businesses and consumers step up their investments in software, computers and smartphones. As crises rocked the housing, automotive and financial sectors, related businesses curtailed investment in software; these cutbacks resulted in a revenue decline in 2009. According to IBISWorld Industry analyst Dale Schmidt, “publishers were not idle during the slowdown, but instead focused 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 the acquisition of Skype in 2011. Participating across an increasingly diverse array of software platforms is practically impossible without resorting to such acquisitions. As continued technological development drives innovation during the next five years, acquisition activity within this industry will grow more robust.

Growth in emerging countries and improving technologies, particularly those related to semiconductors and telecommunications, is creating expanded markets for software publishers. “Furthermore,” adds Schmidt, “mobile computing devices, from cell phones to tablet computers, are opening up entirely new platforms for software publishers”. In addition, companies will move toward cloud computing, which will open up a wider array of software possibilities for mobile phones as tablets, as they will no longer be hampered by their low storage capacity. Industry operators will also increasingly use subscription-as-a-service sales models, which will help stabilize cash flows. This technological growth will continue through the five years to 2018, contributing to a projected increase in industry revenue.

The Software Publishing industry has a low level of market share concentration. Concentration has increased markedly over the past five years. The largest software publishers have been active in acquisitions, targeting smaller companies with innovative products or attractive patent portfolios. Increased consolidation has also been a result of companies trying to gain a larger customer base. Some business customers are looking to reduce the complexity of their IT infrastructure and drive efficiency with fewer IT suppliers. 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 firms in this industry, however, focus on only one or two industry sub-segments. 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. The three largest players in the industry are Microsoft, Oracle and IBM.

For more information, visit IBISWorld’s Software Publishing in the US industry report page.

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IBISWorld industry Report Key Topics

Software publishers disseminate licenses 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 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 or call 1-800-330-3772.

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