As companies get serious about digital transformation, we see investments shifting toward extensible software platforms used to build and manage a differentiated customer experience. My colleague John McCarthy has an excellent slide describing what's happening:
Before, tech management spent most of its time and budget managing a set of monolithic enterprise applications and databases. With an addressable market of a finite number of networked PCs, spending on the front end was largely an afterthought.
Today, applications must scale to millions, if not billions of connected devices while retaining a rich and seamless user experience. Infrastructure, in turn, must flex to meet these new specs. Since complete overhauls of the back end are a nonstarter for large enterprises with 30-plus years of investments in mainframes and legacy server systems, new investments gear toward the intermediary software platforms that connect digital touchpoints with enterprise applications and transaction systems.
At Forrester, we’ve been working to quantify some of the most viable software categories that exemplify this shift. A shortlist below:
· API management solutions: US CAGR 2015-2020: 22%.
· Public cloud platforms: Global CAGR 2015-2020: 30%. (Note: We have a forecast update in the works that segments the market into subcategories.)
· Commerce technology platforms: US CAGR 2014-2019: 12%.
· Cloud security solutions: To be released Q2 2015.
· Advanced analytics: To be released Q3 2015.
Growth in these markets will largely depend on how fast enterprises mature their digital initiatives in mobile, Internet of Things (IoT), and big data. In addition, competitive pressures from disruptive startups and the limitations of tech management budget and staff will further propel the need for modern software platforms.
All of the market forecasts mentioned above will be available as part of a new Forrester product called BT ForecastView. To learn more, join my webinar “Sizing Up The Fastest Growing Software Markets: 2015 And Beyond” on Tuesday, April 21, at 1 p.m. ET. We’ll cover trends in the software market and give highlights from our latest market forecasts.