Software Industry Still Retreating in First Half of 2002
Software Industry Still Retreating in First Half of 2002

3 October 2002



Retreat has been the call for most software vendors during the past six months as new license and now even support and service revenue continued their movement downward. With the software industry on track to be flat over last year's dip, have we hit bottom? What are the prospects for the hot segments of the Internet era? Will it get worse before it gets better for this battered industry?

In this Spotlight, we look at the first half of the 2002 enterprise software market from all angles to see what is really going on with demand, revenue and the future of the market. This Spotlight analyzes what happened in the first six months of software demand of new license revenue and outlines Gartner's predictions for the next few years as the pressure for better value from IT systems continues to keep the software industry in retreat formation.   
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Joanne Correia
Vice President
Gartner Dataquest







Software Industry Still Retreating in First Half of 2002


Business Value of New Software Erodes in First Half of 2002
3 October 2002
Roger Fulton  Joanne Correia 

Deal size has rapidly shrunk for software-based business initiatives, and the time to sell is longer and to deliver is shorter. As business confidence returns, spending on infrastructure software will recover before applications software does.





Consolidation Continues: Titans vs. Pure-Play Vendors
26 September 2002
Roger Fulton  Norma Schroder  Joanne Correia  Colleen Graham 
The continued economic doldrums are changing the shape of the software industry as titans are expected to gain revenue share at the expense of the pure-play vendors.



Software License Market Still Shrinking
30 September 2002
Roger Fulton  Chad Eschinger  Norma Schroder  Joanne Correia  Thomas Topolinski  Colleen Graham  Fabrizio Biscotti  Hams El-Gabri  Judith Rosall 
The software industry is reporting huge quarterly swings in software licenses, but spending was still shrinking at the end of the first half of 2002.




ISVs and ESPs Fight Over Shrinking IT Spending
1 October 2002
Roger Fulton  Tony Adams 
Independent software vendors (ISVs) are competing hard with their partners, the external service providers (ESPs), for a share of any new IT spending.



Infrastructure Software Market Dreary in 1H02
1 October 2002
Norma Schroder  Joanne Correia  Colleen Graham 
The first half of 2002 has shown that infrastructure software vendors must adapt to a very different business environment than existed in the past.




EAS Vendors Struggle to Adjust to New Buyer Behavior
26 September 2002
Chad Eschinger  Thomas Topolinski  Hams El-Gabri 
EAS market growth is still declining in the first half of 2002. The transition from hype to return on investment, buyer behavioral changes and economic pressures have contributed to new license sales drop.