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Mumbai, India, May 22, 2015

Gartner Says India Software Market Grew 8 Percent in 2014

India Has The Highest Growth Rate Among The BRIC Countries Microsoft, Oracle And IBM Are The Top 3 Vendors

India software revenue totaled $4 billion in 2014, an 8.3 percent increase from 2013 revenue of $3.7 billion, according to Gartner, Inc.

“The enterprise software marketplace is dynamic and ever-changing. Its growth and structure are being shaped by the factors and forces of decentralized purchasing, consumerization and mobility, influence of emerging markets, cloud-based implementations, and new consumption models,” said Bhavish Sood, research director at Gartner.” Improvement in global economic conditions has somewhat relaxed the strain on the Indian economy, thereby boosting corporate sentiments. Along with a new stable government at the center, this has helped in alleviating concerns about economic growth — to a certain extent — with early signs of spending in growth initiatives beginning to emerge.”

 Several leading trends that are common across the India software market include:

  • Software as a service (SaaS) adoption and development
  • Open-source software (OSS) adoption and its broader market implications
  • Changing buying behaviors and purchasing styles associated with the digital business
  • Spending in key growth markets, such as India and China

Microsoft maintained the No. 1 position in software revenue in India, accounting for 25 percent of overall sales in 2014 (see Table 1). The top three vendors in the market (Microsoft, Oracle, and IBM), represent 50 percent of total software sales in India.

Table 1
Top
 10 Software Vendors in  India, by Revenue, 2013-2014 (Millions of Dollars)

 

Vendor

2013 Revenue

2013 Market Share (%)

2014 Revenue

2014 Market Share (%)

Growth (%)

Microsoft

954.3

26

1017.9

25

7

Oracle

484.0

13

516.7

13

7

IBM

444.0

12

475.3

12

7

SAP

286.1

8

317.4

8

11

VMware 

91.5

2

105.3

3

15

CA Technologies

54.7

1

50.9

1

-7

Adobe

42.5

1

27.5

1

-35

SAS

32.7

1

33.1

1

1

HP

38.4

1

33.0

1

-14

Others

1,271.3

34

1,429.4

36

12

Total

3,699.5

100

4,006.4

100

8

Source: Gartner (April 2015)

Among the main drivers for increased IT adoption is the appreciation of IT as an enabler for business change. Gartner analysts expect enterprises to continue to invest in IT to improve productivity and drive enterprise growth by delivering operational results, while reducing enterprise costs and attracting and retaining customers.

Among the BRICS (Brazil, Russia, India, China and South Africa), the India software market experienced the highest growth rate (see Table 2) .Apart from mega vendors there’s a thriving ecosystem of product startups that are getting incubated in India, and as such, they are helping drive software adoption through their innovative, small foot print low cost products.

Table 2. BRICS Software Spending Growth Rate, 2014-2013 (by Percentage)

Country

2013 Growth

Rate (%)

2014 Growth

Rate (%)

Brazil

7.6

5.4

China

6.8

3.8

India

10.7

8.3

Russia

9.2

-6.4

South Africa

6.3

4.8

Total

7.9

3.7

Source: Gartner (April 2015)

“Government plans around Digital India, smart cities, and increased focus on broadband internet infrastructure is expected to drive local consumption of IT software and associated services,” said Mr. Sood. “After the last federal election the mood of the economy has changed, and we are slowly seeing a revival in IT spending particularly in areas of digital and nexus of forces that combine cloud, mobile, social and big data.”

More detailed analysis is available in the report "Market Share: All Software Markets, Worldwide, 2014." The report is available on Gartner's website at http://www.gartner.com/document/3019720.

About Gartner

Gartner, Inc. (NYSE: IT), is the world’s leading research and advisory company and a member of the S&P 500. We equip business leaders with indispensable insights, advice and tools to achieve their mission-critical priorities today and build the successful organizations of tomorrow.

Our unmatched combination of expert-led, practitioner-sourced and data-driven research steers clients toward the right decisions on the issues that matter most. We are a trusted advisor and objective resource for more than 15,000 organizations in more than 100 countries — across all major functions, in every industry and enterprise size.

To learn more about how we help decision makers fuel the future of business, visit gartner.com.

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