Microsoft takes down Oracle to retain software top spot

Worldwide software revenue totalled $407.3 billion in 2013, a 4.8 percent increase from 2012 revenue of $388.5 billion, with Microsoft retaining top spot in the industry ahead of Oracle.

According to Gartner the developed geographies were the primary growth drivers offsetting the relative sluggishness in emerging markets.

The software industry is in the middle of a multiyear cyclical transition as organisations are focusing investment on technologies to support existing system structure, in order to maintain competitiveness, while still taking advantage of cloud/subscription-based pricing where it makes sense to grow and advance the business.

“There is a shift in vendor rankings from 2013 at the top of the worldwide software market,” says Chad Eschinger, research vice president at Gartner.

“This is the first time in Gartner’s global software market share research that Oracle has ranked second in terms of total software revenue with $29.6 billion and capturing 7.3 percent of the global market.

“Global trends around big data and analytics with business investment in database and cloud-based applications helped to drive Oracle’s top-line growth.”

Salesforce.com, with more than $3.8 billion in revenue during 2013, climbed two positions to capture the No. 10 slot of the worldwide enterprise software market, and it achieved the highest growth among the top 10 vendors at 33.3 percent.

“Investors continue to focus on revenue growth and market share gains as the primary criteria when evaluating vendors,” adds John Rizzuto, research vice president and Invest analyst, Gartner.

“At this point, the new and emerging technology markets in software, such as digital marketing and public cloud computing, are so nascent that investors are favoring those companies that are early and aggressive in grabbing both market and mind share — in many cases dismissing progress on earnings and cash flow in hopes that they will one day follow.”

“The software market has been changing shape over the past five years, and cloud is driving the bulk of this change as software vendors acquire and provide applications and infrastructure technology to support the cloud and the Internet of Things (IoT) movement,” adds Joanne Correia, research vice president, Gartner.

“A clear indicator of this is that for the first time we have a pure cloud vendor in the top 10.”

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