Gartner Research

Prepare for Sweeping Changes Coming to the U.S. Federal Software Market

Published: 09 September 2016

ID: G00314281

Analyst(s): Katell Thielemann , Victoria Barber

Summary

New policy and legislation are shaking the large yet fragmented federal software market, impacting commercial software companies, resellers, software asset management providers and custom software developers. Strategic planners need to prepare now to get ahead of the coming shifts.

Table Of Contents
  • Impacts

Analysis

Impacts and Recommendations

  • As the result of an OMB directive to streamline software purchasing and management, commercial software vendors and resellers can no longer prohibit the sharing of all prices and T&Cs with other government entities
  • Because of the federal government's category management policies, in the next 12 months, commercial software vendors and resellers will start feeling pressure for standard T&Cs, pricing and volume discounts, but they can also benefit from streamlined renewals and broader agency reach
  • In light of new federal regulations and continued budget pressures, software asset management tool and service providers have an 18- to 24-month window of opportunity to aggressively market their offerings
  • With the move toward COTS, SaaS and open source, custom software development providers will start seeing threats to their addressable market within the next six months

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