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Gartner Predicts Modest Growth for Enterprise Business Applications Software

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June 20, 2012

Gartner Predicts Modest Growth for Enterprise Business Applications Software

By Tracey E. Schelmetic, TMCnet Contributor

It's nice to see some growth somewhere in the economy. While growth for 2012 in enterprise business applications may not be setting any records, given the current world economy, any growth seems like a good thing.

 According to new research from Gartner (News - Alert), global spending on enterprise application software will total $120.4 billion in 2012, which represents a 4.5 percent increase from 2011 spending of $115.2 billion. With only limited signs of improvement in the near term, the growth projection for 2012 has been adjusted downward from five percent in the previous forecast in the first quarter of 2012.

The application software market segment is split into a number of key areas: business intelligence (BI); content, communications and collaboration; customer relationship management (CRM); digital content creation (DCC); enterprise resource planning (ERP); office suites and personal productivity; project and portfolio management (PPM (News - Alert)); and supply chain management (SCM).

According to the Connecticut-based analyst group, most of the spending will focus on replacing existing solutions or upgrading software for mission-critical operations.

“The global marketplace is still experiencing a series of conflicting and contrasting economic news reports, and the full impact of the economic uncertainty on the enterprise software markets may not be readily assessable until the end of the first half of 2012,” said Tom Eid, a research vice president at Gartner, in a press release. “Spending in 2012 is anticipated to focus on industry-specific applications; upgrades to established, mission-critical software; integrating and securing established systems and infrastructure; and software as a service (SaaS (News - Alert)) deployments representing extensions to, or replacement of, existing applications and new solutions,” he said.

The strongest growth is expected to be in enterprise resource planning, with revenue projected to reach $24.9 billion in 2012, followed by office suites at $16.5 billion. BI revenue is forecast to reach $13.0 billion, and CRM is on pace to exceed $13.0 billion this year, said Gartner.

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Edited by Brooke Neuman

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