15 Jul 2021

India’s Software Market Revenue to Reach US$7.6 Billion by End of 2021, According to IDC

New Delhi, July 15, 2021: According to the International Data Corporation (IDC) Worldwide Semiannual Software Tracker 2H20 (July–December), the India software market is estimated to reach US$7.6 billion by the end of CY21. The India software market was pegged at US$7.0 billion in 2020, registering a growth of 13.4% year-over-year (YoY) compared with that in 2019. India accounted for 17.5% share of the overall Asia/Pacific (excluding Japan and China) (APEJC) region software market in 2020. Microsoft, Oracle, and SAP maintained their leadership positions in the India market during the same year.

Shweta Baidya, Senior Research Manager for Software and IT Services at IDC India says, "Although the pandemic had a minor impact on the overall growth of the India software market, it acted as a catalyst for strong growth across some of the software segments as enterprises reevaluated their IT strategies and took concrete steps to move toward digital business models. Digitally matured enterprises were able to smoothly navigate through the crisis and maintain business continuity and operational resilience. However, enterprises with traditional business models charted out new strategies to leverage cloud and digital to stay relevant and consistent. Investment in collaborative platforms, network transformation, and security re-architecture witnessed a spike during the last few quarters."

IDC classifies the software market into three primary categories: applications, application development and deployment (AD&D), and systems infrastructure (SI) software. Applications contributed 60.4% to the overall market revenue, followed by AD&D and SI software with shares of 21.6% and 18.0%, respectively, in 2020.

As per IDC's current estimates, engineering applications, collaborative applications, customer relationship management (CRM) applications, enterprise resource management (ERM) applications, and content workflow and management applications are the leading software segments in terms of revenue. The collaborative applications market witnessed the highest growth of 36.7% in 2020, followed by artificial intelligence (AI) platforms and system and service management software at 30.9% and 24.8%, respectively.

India Market Forecast

IDC estimates India's overall software market to grow at a compound annual growth rate (CAGR) of 11.6% from 2020 to 2025. India enterprises will continue to invest in technologies that will help them spur innovation to improve operational efficiency and employee productivity, and in turn, maintain business momentum. IDC expects acceleration in demand for technologies, such as robotic process automation (RPA) software, conferencing and collaborative applications, AI platforms, digital commerce applications, and IT service management (ITSM) software, among others. Additionally, cloud is also becoming one of the critical elements of enterprises' digital strategy. IDC expects the contribution of platform-as-a-service (PaaS) and software-as-a-service (SaaS) markets to the overall software market to increase from 36.8% in 2020 to 57.1% in 2025.

"In spite of the adverse impact of the pandemic, India continued to be one of the most resilient markets across the APEJC region. India software market registered a growth of 13.4%, which was the highest in the region. Enterprise sentiments improved during the second half of the year and investments were ramped up quickly on digital work models to enable smooth transition to a remote work environment. IT budgets were re-apportioned and allocated in accordance with the increased spending on emerging technologies. Software vendors have been aggressively acquiring customers by supporting them in the digital journey with flexible and scalable options," adds Baidya.

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IDC Tracker  products provide accurate and timely market size, company share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly Excel deliverables and online query tools. The IDC Tracker Charts app allows users to view data charts from the most recent IDC Tracker products on their iPhone and iPad.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight help IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC  and LinkedIn. Subscribe to the IDC Blog for industry news and insights: http://bit.ly/IDCBlog_Subscribe.

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