IDC Forecasts North American Packaged Software Revenues Will Approach $35 Billion in the Finance Industry Alone
FRAMINGHAM, MA – APRIL 18, 2001 – The North American finance industry will open up the vaults and spend a whopping $33.6 billion on packaged software in 2004 – more than twice as much as the $16 billion the industry spent in 1999. This information comes from a new bulletin series from IDC. "All segments of the packaged software market will grow in the finance industry, but tools will increase the fastest," said Karen O’Brien, research manager for IDC’s Vertical Industry Practices research on U.S. Banking and Finance.
According to IDC, the tools segment will earn a compound annual growth rate (CAGR) of 22% from 1999-2004. System infrastructure’s CAGR will be 17% during the same time frame, and applications, 10%.
The increase in the amount of data financial firms use will drive the tools segment’s growth. Customer relationship management [CRM] initiatives will give an added boost to data warehousing and other information access and data management tools. Software tools that facilitate linking operational and analytical data for CRM purposes will be particularly important," O’Brien said.
IDC expects CRM to lead spending growth in the applications segment. In fact, the finance industry will triple its spending on CRM applications from $547 million in 1999 to over $1.8 billion in 2004. Banks will lead the CRM charge, increasing their spending from $262 million to almost $890 million during the same time frame. "Banks are shifting from a product-centric strategy to a customer-centered one," O’Brien said. "CRM applications that have personalization and customization abilities, serve multichannels, and have the ability to link with legacy databases will be in high demand."
IDC believes middleware and serverware will be the fastest-growing area of infrastructure software with spending increasing at a 25% annual pace between 1999 and 2004. "Growth in middleware and serverware spending will be driven by products that translate and link existing legacy systems with data and new Web-based applications," O’Brien said.
Of the three sectors of the finance industry – banking depository, insurance, and other financial services – IDC believes banks will account for the majority of revenues in the overall packaged software market.
IDC examines the North American packaged software opportunity in the finance industry in great detail in three new bulletins:
· North American Applications Packaged Software: Finance Vertical Markets Forecast and Analysis, 2000-2004 (IDC #B24057) divides the market into the following segments: CRM, enterprise resource management, vertical industry specific, and office and collaborative applications.
· North American Packaged Software: Tools, Finance Vertical Markets Forecast and Analysis, 2000-2004 (IDC #B24171) divides the market into the following segments: information access, information and data management, application development and constructions tools, and application life-cycle management tools.
· North American Packaged Software: Systems Infrastructure Finance Vertical Markets Forecast and Analysis, 2000-2004 (IDC #B24117) divides the market into the following segments: middleware and serverware, security, systems and network management, and systems-level and networking packaged software.
All three bulletins forecast 2000 and 2004 revenues for all segments by finance sector. To purchase any of these bulletins, contact Cheryl Toffel at 1-800-343-4952, extension 4389, or at firstname.lastname@example.org.
IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world’s leading IT suppliers, IT organizations, ebusiness companies and the financial community. Additional information can be found at www.idc.com.
IDC is a division of IDG, the world's leading IT media, research and exposition company.
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