Independent Software Vendors (ISVs) Market Analysis North America, Europe, APAC, South America, Middle East and Africa - US, China, Japan, UK, Germany - Size and Forecast 2024-2028

Independent Software Vendors (ISVs) Market Forecast 2024-2028

The Independent Software Vendors (ISVs) Market size is forecast to increase by USD 2,058.15 billion, at a CAGR of 14.73% between 2023 and 2028. One of the key factors driving the market growth is the rise in volume of enterprise data. The fast-rising volume and complexity of generated data are fueled by the increased cloud computing market traffic, and the rapid development and acceptance of technologies including the IoT and artificial intelligence (AI). In addition, every click, swipe, share, search, and stream generates data, fueling the need for big data analytics and storage solutions across the world.

A key factor shaping the market growth is the increasing adoption of cloud computing by end-users. Agencies and corporates are adopting Software as a Service (SaaS) for several applications including authentication processes, video management, biometric information storage, and big data computing. In addition, the flexibility and scalability of cloud-based solutions help organizations and governments meet their varying needs with productivity tools and mobile applications integrating AI and machine learning (ML).

What will be the Size of the Market During the Forecast Period?

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Market Segmentation By Deployment

The on-premises segment is estimated to witness significant growth during the forecast period. There is an increasing preference for ISVs to deploy their software through the on-premises medium. In addition, on-premises software is locally hosted software inside the organization's premises. Furthermore, the on-premises software uses the organization's computer systems, and the organization pays a one-time license fee.

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The on-premise segment was the largest segment and was valued at USD 912.99 billion in 2018. Moreover, the organization has control over the data in on-premises software, which helps improve the organization's data security. In addition, most on-premises software is open source, which means that organizations can tweak the program according to their exclusive needs. Furthermore, large technology companies with extremely sensitive data tend to use on-premises software and provide highly sensitive data. In addition, the high hardware cost and the frequent maintenance required by on-premises software discourage organizations from adopting on-premises software. Hence, such factors are fuelling the growth of this segment which in turn will drive the market growth during the forecast period.

Market Segmentation By Component

The rapid adoption of cloud-based solutions among businesses will fuel the software segment which in turn will increase the market growth. Software providers are looking for opportunities to deliver more value to customers while simultaneously increasing profitability and enhancing internal operations through reduced cost and complexity. In addition, organizations are increasingly focusing on improving their business by digitalizing processes and systems through new digital platforms, which surges the demand for various software. Moreover, organizations are increasingly focusing on improving their business by digitalizing processes and systems through new digital platforms, which surges the demand for various software. Hence, such factors are fuelling the growth of this segment which in turn drives the market growth during the forecast period.

Regional Overview

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North America is estimated to contribute 35% to the growth of the global market during the forecast period. Technavio's analysts have provided extensive insight into the market forecast, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. The increasing tendency of small and medium enterprises (SMEs) to partner with e-commerce players and integrate with other online applications, including automated bank feeds and automated billing capabilities, for which the usage of business software during the projection period.  Therefore, this, in turn, will boost the demand for software created by ISVs. Moreover, the business software provided by ISVs has emerged as a superior alternative for managing a company's finances since it can quickly manage account payables, account receivables, business payroll, and general ledger, among other business modules. Hence, such factors are driving the market growth in North America during the forecast period.

Market Dynamics and Customer Landscape

The market is witnessing growth driven by the rise in volume of enterprise data, necessitating innovative software solutions to address specific business problems across diverse industries. An evident trend in this market is the increasing adoption of cloud computing by end-users, offering scalability and flexibility through Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) models.

However, the industry faces challenges such as the high costs of licensing and support, posing barriers to entry for startups and small businesses. With a focus on delivering enterprise applications, productivity tools, and industry-specific software, ISVs cater to the evolving needs of multinational corporations and startups alike, spanning sectors such as BFSI, retail & e-commerce, IT & telecom, and automotive. As businesses increasingly rely on web-based services and cloud technologies, ISVs play a crucial role in providing technical support, training, and innovative solutions to drive efficiency and growth. Informed by market growth analysis, ISVs navigate through market dynamics to capitalize on emerging opportunities and address challenges effectively.

Key Market Drivers

One of the key factors driving the market growth is the rise in volume of enterprise data. The fast-rising volume and complexity of generated data are fuelled by the increased mobile data traffic, cloud computing traffic, and the rapid development and acceptance of technologies including the IoT and artificial intelligence (AI).  In addition, every click, swipe, share, search, and stream generates data, fueling the need for big data analytics and storage solutions across the world.

Moreover, the growing use of IoT-connected devices across the world has led to the creation of massive volumes of data. In addition, the increased adoption of connected automobiles, connected homes, connected health, and smart cities has led to an increase in the amount of data collected by these devices. Hence, such factors are positively impacting the market. Therefore, it is expected to drive the market growth during the forecast period.

Significant Market Trends

A key factor shaping the market growth is the increasing adoption of cloud computing by end-users. Agencies and corporates are adopting cloud-based software for several applications including authentication processes, video management, biometric information storage, and big data computing. In addition, the flexibility and scalability of cloud-based solutions help organizations and governments meet their varying needs.

Moreover, the increase in the use of IoT-connected devices across the world has resulted in the generation of a large amount of data. In addition, the rise in the adoption of connected cars, connected homes, connected health, and smart cities has increased the data generated by these devices. Furthermore, many industries, including manufacturing, utilities, retail, automotive, and social media, use IoT for increased data transfer. Hence, such factors are driving the market growth during the forecast period.

Major Market Challenges

High costs of licensing and support are the key challenges hindering market growth. The ISVs initially started as service providers and then transformed into a product-oriented industry and are currently transitioning into a hybrid of both product and service industries. In addition, the product or software licensing and maintenance segment has transitioned into a hybrid-oriented industry.

Moreover, single-user and concurrent-user licensing models were conventional licenses offered in the corporate application area. In addition, concurrent user licensing is slowly going out of trend. Furthermore, usage-based licensing is becoming more common, and perpetual licensing remains the preferred strategy.  As a result, this has resulted in expensive license and maintenance support costs, which will hurt the market. Hence, such factors are hindering the market growth during the market growth. 

Market Customer Landscape

The market forecasting report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and trends strategies.

Global Market Customer Landscape

Who are the Major Market Companies?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Adobe Inc: The company offers independent software companies such as Adobe Acrobat, Adobe Acrobat Sign, and Adobe PDF service.

Autodesk Inc: The company offers independent software companies such as SOFiSTiK, which help to analysis, design and detailing of building projects worldwide.

Avgi Solutions Inc: The company offers independent software companies with the growth of cloud computing, the extremely rapid adoption of mobile devices and the constant evolution of consumer interaction.

The  Market  growth and forecasting report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:

• Alphabet Inc.
• Cisco Systems Inc.
• Dell Technologies Inc.
• HP Inc.
• International Business Machines Corp.
• Intuit Inc.
• Magic Software Enterprises Ltd.
• Microsoft Corp.
• Mocana Corp.
• Nutanix Inc.
• Open Text Corp.
• Oracle Corp.
• Salesforce Inc.
• SAP SE
• ServiceNow Inc.
• Virtusa Corp.
• VMware Inc.

Market analysis and report of qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Market Analyst Overview

In the ever-evolving landscape of technology, ISVs play a pivotal role in delivering innovative software solutions to various sectors. From enterprise applications to industry-specific software, ISVs cater to the diverse needs of startups to multinational corporations.

With the advent of cloud technologies like IaaS and PaaS, ISVs leverage these platforms to develop software-as-a-service (SaaS) offerings, ensuring integration and interoperability across hardware manufacturers and internet of things (IoT) devices. They delve into sectors such as healthcare, logistics, BFSI (Banking, Financial Services, and Insurance), and retail & e-commerce, addressing specific business problems with web-based services and standalone applications.

The integration of AI integration and machine learning (ML) integration into IoT applications enhances user experience (UX) while addressing privacy concerns. ISVs also collaborate with Salesforce Industries to deliver tailored solutions.

Furthermore, they provide technical support and training on programming languages to empower IT & telecom sectors and education institutions. As large technologies and platforms companies drive the adoption of digital solutions, ISVs remain at the forefront, embracing the latest technologies to shape the future of software products and mobile apps.

Segment Overview

The market research report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest market trends and analysis and growth opportunities from 2018 to 2028.

•  Deployment Outlook
  • On-premises
  • Cloud based
• Component Outlook
  • Software
  • Services
• Region Outlook
  • North America
    • The U.S.
    • Canada
  • Europe
    • U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • South America
    • Chile
    • Argentina
    • Brazil
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

 

Market Scope
Report Coverage	Details
Page number	168
Base year	2023
Historic period	2018-2022
Forecast period	2024-2028
Growth momentum & CAGR	Accelerate at a CAGR of 14.73%
Market Growth 2024-2028	USD 2,058.15 billion
Market structure	Fragmented
YoY growth 2023-2024(%)	12.82
Regional analysis	North America, Europe, APAC, South America, and Middle East and Africa
Performing market contribution	North America at 35%
Key countries	US, China, Japan, UK, and Germany
Competitive landscape	Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks
Key companies profiled	Adobe Inc., Alphabet Inc., Autodesk Inc., Avgi Solutions Inc., Cisco Systems Inc., Dell Technologies Inc., HP Inc., International Business Machines Corp., Intuit Inc., Magic Software Enterprises Ltd., Microsoft Corp., Mocana Corp., Nutanix Inc., Open Text Corp., Oracle Corp., Salesforce Inc., SAP SE, ServiceNow Inc., Virtusa Corp., and VMware Inc.
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period.
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market report forecast during the forecast period
• Detailed information on factors that will drive the growth of the market between 2023 and 2028
• Precise estimation of the market  size and its contribution to the market in focus on the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market across North America, Europe, APAC, South America, and Middle East and Africa
• Thorough market analysis and report of the market’s competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of Industry companies

 

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