Increasingly powerful predictive analytics tools will unlock business insights and drive revenue.
New York, NY (PRWEB) August 28, 2014
Revenue for the Business Analytics and Enterprise Software Publishing industry grew steadily over the past five years and is expected to continue growing due to favorable demand conditions caused by high business profit. In 2014, industry revenue is expected to rise as businesses invest in industry products to take advantage of high corporate profit and low interest rates. During the five years to 2014, industry revenue slightly increased, driven by businesses' increased technological complexity and eagerness to adopt efficiency-enhancing software. Many industry products, such as customer relationship management (CRM) and enterprise resource planning (ERP) software systems, are basic tools in the management of Fortune 500 companies.
According to IBISWorld Industry Analyst Sarah Kahn, “The world's largest software companies have spent the past five years acquiring high-performing enterprise software vendors and cloud computing businesses.” Some examples of this aggressive acquisition trend include Oracle's purchases of Hyperion Solutions, PeopleSoft, Siebel Systems, Taleo and Nimbula; IBM's acquisition of Cognos, SPSS, Varicent and SoftLayer; and SAP's procurement of Business Objects and Crystal Decisions, SuccessFactors and Hybris AG. These acquisitions allow large software vendors to pursue a portfolio approach and leverage existing clients by offering software suites, catering to their needs. Major companies are selective in their acquisitions, embracing the move from product offerings to Software as a Service and adopting the low-cost cloud model, hoping to retain corporate customers. The new web-based pay-as-you-go service will allow business applications, previously confined within the walls of company firewalls and personal computers, to be accessed by any secure internet connection, even from mobile phones.
This industry is highly concentrated, with the four largest firms controlling a great majority of industry revenue. The competitive characteristics of this industry, and IT in general, tend to favor a higher level of concentration; while software has significant upfront costs (e.g. research and development), there are almost zero marginal costs because, once produced, the software is infinitely reproducible. As a result, the fewer products in development, the higher industry profit is. Furthermore, the confusing array of products and licensing schemes that exist tend to lead consumers towards brands rather than individual products, so industry consolidation is favorable. “Concentration within this industry will continue to increase as the world's largest software vendors acquire promising small software companies,” says Kahn.
The Business Analytics & Enterprise Software Publishing industry is just beginning to tap into its growth potential and, during the next five years, increasingly powerful predictive analytics tools will unlock business insights, which will drive revenue. These tools can automatically forecast trends in business statistics (e.g. per-store revenue) and consumer behavior when combined with existing data-mining technologies. As businesses in a wide variety of industries, including small and midsize companies, increasingly use IT infrastructure to record and store business data, the potential for these technologies will only continue to expand.
For more information, visit IBISWorld’s Business Analytics & Enterprise Software Publishing in the US industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld.
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189.
IBISWorld industry Report Key Topics
Companies in this industry develop and distribute business analytics, customer relationship management (CRM), business intelligence (BI) and other enterprise-oriented software. Operators may also provide consulting and technical support related to this software. This industry does not include publishers of productivity or database software or manufacturers of computer hardware.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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 http://www.ibisworld.com or call 1-800-330-3772.