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1、T E C H N O L O G Y The Top 10 Software Vendors Positioning, performance and SWOT analyses ii Copyright 2008 Business Insights Ltd This Management Report is published by Business Insights Ltd. All rights reserved. Reproduction or redistribution of this Management Report in any form for any purpose i
2、s expressly prohibited without the prior consent of Business Insights Ltd. The views expressed in this Management Report are those of the publisher, not of Business Insights. Business Insights Ltd accepts no liability for the accuracy or completeness of the information, advice or comment contained i
3、n this Management Report nor for any actions taken in reliance thereon. While information, advice or comment is believed to be correct at the time of publication, no responsibility can be accepted by Business Insights Ltd for its completeness or accuracy. iii Table of Contents The Top Ten Software V
4、endors Executive summary 14 Market development 14 Microsoft 15 IBM 15 Oracle 16 SAP 16 SunGard Data Systems 17 Symantec 17 CA 18 EMC 18 Amdocs 19 Intuit 19 Chapter 1 Introduction 22 What is this report about? 22 Methodology 22 Chapter 2 Market development 26 Summary 26 Overview 27 Market size and gr
5、owth 27 Key trends in software market 29 Shift towards virtualization 29 Growing internet and data security market 30 Consolidation 30 Shifting business models 31 iv Chapter 3 Microsoft 34 Summary 34 Company information 34 History 35 Recent financial performance 39 Acquisitions and divestments 42 Ma
6、rket positioning 43 Growth strategies 45 Focus on new product development 45 Penetration into emerging markets 45 SWOT analysis 46 Strengths 46 Strong revenue growth 46 Broad offering 47 Strong R it has also been included in the report because the revenue from its software division was larger than t
7、he overall revenue of many players under top ten rankings. 23 There are several large IT companies such as HP that are engaged in both hardware and software markets. Although we have the consolidated revenues for such companies the segment revenue information is not present in the annual reports. We
8、 have taken those players under our 11 to 20 rankings only on the basis of their software division because their software business brings less revenue than their services and hardware divisions. 24 25 CHAPTER 2 Market development 26 Chapter 2 Market development Summary ? In 2006, the global software
9、 market grew by 5.7% over 2005 to reach $203.4bn. For the five-year period spanning 20022006, the market grew at a CAGR of 5.5%. ? The global software market is forecast to reach about $272bn in 2011, representing a five-year CAGR of 7.5%. ? The top 10 software vendors had a market size of $105bn in
10、 2006, taking 51.7% of the total market in 2006. The remaining market is highly fragmented with players accounting for less than 0.5% market share. ? Microsoft is the global industry group leader with a 21.8% market share in 2006, followed by IBM with 8.9% market share. ? Major trends in the softwar
11、e industry include a shift towards virtualization, growing the internet and data security market, consolidation and shifting business models. 27 Overview Market size and growth The global software market grew by 5.7% over 2005 to reach $203.4bn in 2006. For the five-year period spanning 20022006, th
12、e market grew from $169.3bn in 2002 to $203.4bn in 2006, a compound annual growth rate (CAGR) of 5.5%. Figure 2.1: Global software market size, 20022006 0 50 100 150 200 250 20022003200420052006 Market size ($bn) 0 1 2 3 4 5 6 7 Growth (%) Market sizeGrowth rate 0 50 100 150 200 250 2002200320042005
13、2006 Market size ($bn) 0 1 2 3 4 5 6 7 Growth (%) Market sizeGrowth rate Source: Business Insights Business Insights Ltd The top 10 software vendors represented 51.7% of the total market by revenues in 2006. Microsoft is the global industry group leader with a 21.8% share of the top ten companies re
14、venues in 2006, followed by IBM with 8.9% share. 28 Figure 2.2: Turnover of Top 10 players ($m) in 2006 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 Microsoft IBM Oracle SAP SunGard Symantec CA EMC Amdocs Intuit Turnover ($m) 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,00
15、0 45,000 Microsoft IBM Oracle SAP SunGard Symantec CA EMC Amdocs Intuit Turnover ($m) Note: Turnover figures are taken for year 2006 as some of the companies have not declared their financial results for 2007. For Microsoft fiscal year end is June 2006, Oracle May 2006, Symantec March 2006, CA March
16、 2006, Amdocs February 2006 and Intuit July 2006. Source: Business Insights Business Insights Ltd Table 2.1: Overview of top 10 players ($m), 2006 Ranking Company Turnover Market Operating Turnover Share Margin CAGR (20042006) 1 Microsoft 44,282 21.8% 37.2% 9.6% 2 IBM 18,161 8.9% 85.2% 6.1% 3 Oracle
17、 14,380 7.1% 23.5% 19.1% 4 SAP 8,297 4.1% NA 13.4% 5 SunGard 4,323 2.1% 12.3% 10.3% 6 Symantec 4,143 2.0% 6.6% 48.8% 7 CA 3,772 1.9% 4.4% 6.4% 8 EMC 2,937 2.8% NA 16.0% 9 Amdocs 2,480 1.2% 13.4% 18.2% 10 Intuit 2,293 1.1% 24.7% 12.8% 11 Others 98,332 48.3% Note: The CAGR for IBM and SAP has been ide
18、ntified on the basis of its software segments revenue. Source: Business Insights Business Insights Ltd 29 Key trends in software market Shift towards virtualization Virtualization is fast becoming a key requirement for every server in the data centre, enabling increased workloads in server consolida
19、tion projects, efficient software development and testing, resource management for dynamic data centers, application re-hosting and compatibility, and high-availability partitions. Reduced costs for IT organizations (end user customers) are driving virtualization software into a booming market. VMWa
20、re is the market leader in virtualization software market. Other leading players in this market include Microsoft and Citrix. Driven by growing trend towards software virtualization, software vendors are focusing on strengthening their virtualization software offering through acquisitions and innova
21、tion. For instance, Microsoft acquired Softricity in 2006. Softricity offers the SoftGrid Desktop Virtualization Platform, which turns almost all Windows applications into a service using application virtualization and streaming software technologies. Citrix is also developing a software tool that w
22、ill help Microsofts Hyper-V virtualization feature in the upcoming Windows Server 2008 to work more easily with Citrixs XenServer product. Several software vendors are entering into virtualization software market. For instance, in October 2007, Egenera, the data center virtualization company, entere
23、d the virtualization software market by making available its Processing Area Network (PAN Manager) software to other vendors hardware platform. In the data center, virtualization supports server consolidation and enables workloads to be added and moved automatically to match computing needs as deman
24、d changes. This provides greater agility and more efficient use of resources. On the desktop, application virtualization reduces management costs, as it enables the users to access the computing resources they need anywhere, from any machine. This 30 increases flexibility for employees and greater e
25、fficiency and agility for IT departments. Accelerating acceptance of virtualization software by IT organizations (end users of software vendors) can reduce the complexity and costs, which will help drive the software vendor market. Growing internet and data security market Internet security and data
26、 protection are the fastest growing segments in the PC software market. Increasing number of a variety of different malware threats, including computer viruses, trojan horses, worms and spyware are driving the growth of home and business security suites. In the internet security suite market, CA hol
27、ds the leadership position. In September 2007, CA issued a report that warns of growing internet threats facing home PC users including targeted identity theft, emerging risks associated with online gaming, a doubling of malware exploits and new software vulnerabilities. According to the report, mal
28、ware will increase by 132% in 2007, with Trojans leading this growth. From January to June 2007, 65% of the malware threats were trojans, 18% were worms, 4% were viruses, and 13% were other types of malware. Increasing number of a variety of different malware threats supports the growth of software
29、vendors who provide home and business security technologies. In addition, regulatory compliance requirements are becoming more stringent, forcing the IT organizations to incorporate security and data protection technologies. This shift creates opportunities for vendors such as EMC and Symantec, whic
30、h have specific strengths in security and data protection technologies. Consolidation The software industry has been in a phase of consolidation for the past 3 to 4 years. The pace of consolidation has picked up for the last two years. For several years, globalization has driven software M MESA 37 G
31、roup, a Boston based company that offered tools and services for customers who wish to transfer existing Lotus Notes applications to Microsoft Exchange Server; Valence Research, a developer of industry leading TCP/IP load balancing and fault tolerance software for the Microsoft Windows NT operating
32、system. In 2002, Microsoft launched the .NET initiative, along with new versions of some of its development products, such as Microsoft Visual Studio. Microsoft acquired the virtual machine solutions of privately held Connectix, a provider of virtualization software for Windows and Macintosh-based c
33、omputing in 2003. In the same year, it also acquired PlaceWare, a provider of Web conferencing services that enables businesses to conduct real-time, interactive presentations and meetings over the internet. Microsoft acquired ActiveViews, a privately held company based in Provo, Utah, to extend its
34、 business intelligence (BI) platform in 2004. In the same year, the company released Windows XP Media Center Edition 2005, a version of Windows XP specifically designed for multimedia capabilities, and Windows XP Starter Edition, a version of Windows XP with a smaller feature set designed for entry-
35、level consumers. In 2005, Microsoft acquired Sybari Software, a provider of security products that help businesses worldwide protect their messaging and collaboration servers from viruses, worms, and spam. In the same year, it acquired Groove Networks, a provider of collaboration virtual office soft
36、ware; Front Bridge Technologies, a vendor of managed services that address corporate e-mail security, compliance and availability requirements; Teleo, a provider of voice over internet protocol (VoIP) software and services; , a provider of VoIP technology; and FolderShare, a provider of file synchro
37、nization and remote access technology. In 2006, the company launched Microsoft adCenter, a service that offers pay per click advertisements. It also created the CodePlex collaborative development site for hosting open source projects and by early 2007 commercial open source companies, such as 38 Ara
38、s Corporation, product lifecycle management software provider, began to offer enterprise open source software exclusively on the Microsoft platform. In the same year it acquired MotionBridge, a provider of search technology designed specifically for mobile operators and the mobile internet at the 3G
39、SM World Congress; ProClarity, a software company based in Boise, Idaho, a developer of advanced analysis and visualization technologies that work in association with Microsofts business intelligence (BI) platform; Massive, the New York-based creator of a network for video game advertising; Whale Co
40、mmunications, a provider of secure access products; and Softricity, a provider of application virtualization and dynamic streaming technologies. In October 2007, Microsoft launched the New Xbox 360 Console for families and Microsoft Virtual Earth -3DVIA. In the same month, Microsoft and LogicaCMG, i
41、nformation technology services provider, formed a strategic relationship based on the strong commitment from both companies to launch an initiative called “The Service Factory.” Microsoft released the first public beta of Microsoft Windows HPC Server 2008, a server operating system and tools designe
42、d for the fast-growing high-performance computing (HPC) market, in November 2007. It also introduced Microsoft Search Server 2008 Express, a new addition to its enterprise search lineup. In the same month, Microsoft entered into an agreement to acquire Musiwave SA, an Openwave company and a provider
43、 of mobile music entertainment services to operators and media companies. Microsoft also entered into a strategic partnership with Reliance Communications, an integrated communications service provider in India, to deliver IPTV in India on the Microsoft Mediaroom Platform. In November 2007, Microsof
44、t and Comcast, a cable operator in the US, launched a new internet-based communications product for small and medium-sized businesses (SMBs), which gives SMBs access to services that were traditionally available to only 39 larger companies with IT staff. Later in the same month, Microsoft entered in
45、to an agreement with Morningstar, a provider of independent investment research, to offer streaming video segments from Morningstar stock and fund analysts on MSN Money. Recent financial performance Microsoft recorded the consolidated revenues of $51,122m for the financial year ended June 2007, an i
46、ncrease of 15.4% over the previous year. Operating profits rose by 12.5% to $18,524m in the fiscal ended June 2007, compared with $16,472m in fiscal 2006. Table 3.2: Microsoft financial performance ($m), 20042007 $m 2004 2005 2006 2007 Turnover 36,835 39,788 44,282 51,122 Operating profit 9,034 14,5
47、61 16,472 18,524 Note: The recent fiscal year end for Microsoft is June 2007 Source: Company information Business Insights Ltd Increased licensing of the 2007 Microsoft Office system and Windows Vista and higher revenues associated with SQL Server, Windows Server, and Visual Studio and Xbox 360 supp
48、orted sales growth. In addition, increased revenues and decreased costs for legal settlements and legal contingencies contributed to higher operating profit in the fiscal ended June 2007. 40 Figure 3.3: Microsoft financial performance ($m), 20042007 - 10,000 20,000 30,000 40,000 50,000 60,000 200420
49、0520062007 Turnover/operating profit ($m) TurnoverOperating profit - 10,000 20,000 30,000 40,000 50,000 60,000 2004200520062007 Turnover/operating profit ($m) TurnoverOperating profit Note: The recent fiscal year end for Microsoft is June 2007 Source: Company information Business Insights Ltd Microsoft operates five business segments, three of which - Client, Server and Tools, and Microsoft Business Solutions form the core of its business. These core business segments contributed about 83% of total revenue in the fiscal ended June 2007. The