The China software market size reached around USD 29.64 Billion in 2024. The market is projected to grow at a CAGR of 11.20% between 2025 and 2034 to reach nearly USD 85.69 Billion by 2034. The market growth can be attributed to evolving geopolitical conditions and rapid technological advancements in software design. Moreover, the rising demand for cloud-based software solution is expected to propel the the market growth.
China Software Market Report Summary
Description
Value
Base Year
USD Billion
2024
Historical Period
USD Billion
2018-2024
Forecast Period
USD Billion
2025-2034
Market Size 2024
USD Billion
29.64
Market Size 2034
USD Billion
85.69
CAGR 2018-2024
Percentage
XX%
CAGR 2025-2034
Percentage
11.20%
CAGR 2025-2034- Market by Region
Southwestern China
12.8%
CAGR 2025-2034 - Market by Region
Northwestern China
12.0%
CAGR 2025-2034 - Market by Deployment
Cloud
12.3%
CAGR 2025-2034 - Market by Organisation Size
Small and Medium Enterprises
11.6%
Market Share by Region 2024
Southcentral China
27.2%
China Software Market Growth
The Ministry of Commerce reported that the digital retail industry in China made total sales worth USD 2.16 trillion in 2024. It also reported that the wholesale and retail industry collectively accounted for 10.2% of GDP growth and contributed nearly 13.8 trillion yuan in monetary terms. As key companies enhance their focus on providing superior shopping experiences to consumers, the demand for advanced software solutions ensuring a seamless consumer experience of product selection and checkout is expected to increase substantially. This is expected to drive the China software market development in the coming years.
The rising popularity of advanced driver assistance systems (ADAS) in the automotive industry pinpoints a seismic shift towards the rising appeal of software-driven passenger cars among consumers. For instance, Li Auto, a prominent automotive company, recorded a 182% growth in the number of unit deliveries in 2023. Rapid technological advancements have enabled Chinese automotive companies to provide ADAS-driven vehicles at a range of USD 30,000-40,000 to consumers, which is substantially lower than prices of Germany automobile manufacturers’ luxury models (USD 100,000). This is creating a favourable China software market outlook.
Key Trends and Developments
Increasing trend of AI integration; expansion of cloud computing; growing focus on cybersecurity; and rising demand for IoT and 5G software solutions are the major factors driving the China software market growth.
November 2024
Baidu Inc. launched a slew of new AI-powered applications after making substantial investments in the commercialisation of large language models (LLMs). This includes Miaoda, an advanced tool that can enable users without extensive coding experience to develop new software applications by relying on its LLM capabilities. This is in line with the trend of software democratisation in the country.
April 2024
Tesla secured a deal with Baidu, a Chinese internet company, to use its mapping services. This allows Tesla's Full Self Driving (FSD) system to operate legally on Chinese roads. Baidu will also provide detailed navigation information to help Tesla collect data about road layouts and traffic.
July 2023
China Electronics Corp launched the country’s first open-source desktop operating system to reduce dependence on foreign technology. Known as OpenKylin, the OS is available in 2 languages (English and Chinese) and has pre-installed apps like WPS and Firefox Web browser.
April 2023
Huawei Technologies Co., Ltd. launched its own ERP system, known as MetaERP, thereby reducing its reliance on old systems sourced from Oracle Corp. This future-oriented, cloud-native, ultra-large-scale software is currently responsible for handling the entire range of business scenarios for the company and 80% of its existing business volume.
AI integration in software
There is a growing integration of artificial intelligence across various sectors, including software. Companies are integrating AI into applications like chatbots, automation tools, and business solutions. Leading firms, including ByteDance and Tencent, are focusing on developing advanced AI models, enhancing user experiences, and creating new opportunities in areas like healthcare, finance, and entertainment. This is one of the key China software market trends.
Expansion of cloud computing
China is witnessing significant growth in cloud computing services, driven by the demand for scalable infrastructure and data storage solutions. Major players like Alibaba Cloud and Huawei are expanding their cloud offerings, providing businesses with flexible, cost-effective solutions. This trend supports the rapid digital transformation of industries, including manufacturing, finance, and retail.
Growing focus on cybersecurity
As digitalisation increases, the importance of cybersecurity has become a key trend in the market. Companies are investing heavily in enhancing their security infrastructure to combat growing cyber threats. The government is also enacting stricter regulations to ensure data protection, prompting software firms to focus on robust encryption, threat detection, and compliance solutions. This is accelerating the China software market growth.
Rising demand for IoT and 5G software solutions
With the rapid deployment of 5G networks, the market is witnessing an uptick in demand for Internet of things (IoT) solutions. Software providers are developing platforms that support real-time data analytics, smart devices, and automation across industries such as manufacturing, logistics, and healthcare. This trend is driving innovation in connected technologies, enhancing operational efficiency.
China Software Market Trends
Evolving security concerns triggered by geopolitical tensions
As China seeks to replace foreign software products with domestic alternatives, the demand for word processing systems software is expected to witness steady growth. For instance, WPS Office (a rival of Microsoft Office Suite) reported achieving a daily active user base of nearly 100 million individuals in January 2025. In Q3 FY 2024, it posted a 10% year-on-year growth in profits that reached USD 164 million. The total number of office software users also surpassed 617 million users, thereby indicating higher consumer preference for made-in-China software products. This is propelling the China software market expansion.
Rising demand for ERP software
Under the “Made in China 2025” plan, the Chinese government aims to boost the production of high-end goods (such as aerospace equipment, medical devices, farming machines, and industrial robots) domestically. This is expected to necessitate the need to manage resource allocation effectively. Currently, 35% of Chinese enterprises use SAP ERP system, highlighting the rising demand for enterprise resource planning solutions. This is expected to propel the China software market growth over the forecast period.
China Software Industry Segmentation
The EMR’s report titled “China Software Market Report and Forecast 2025-2034” offers a detailed analysis of the market based on the following segments:
Breakup by Type
- Application Software
- System Infrastructure Software
- Development and Deployment Software
- Productivity Software
Breakup by Deployment
- On-Premises
- Cloud
- Small and Medium Enterprises
- Large Enterprises
- BFSI
- Retail
- Healthcare
- Government
- IT and Telecom
- Others
- Shanghai
- Zhejiang
- Guangdong
- Jiangsu
- Beijing
- Others
Based on deployment, the market is segmented into cloud and on-premises. Over the forecast period of 2025-2034, cloud-based software is expected to grow at a CAGR of 12.3% due to the growing demand for flexibility, scalability, and cost-effectiveness among organisations. The introduction of favourable government initiatives promoting digital transformation is also surging the demand for cloud-based software. Meanwhile, on-premise deployment of software is witnessing a strong demand among sectors requiring greater control over sensitive data.
CAGR 2025-2034 - Market by
Deployment
Cloud
12.3%
On-Premises
XX%
Leading Companies in the China Software Market
Major market players are focusing heavily on advancements in artificial intelligence (AI), with companies like ByteDance, Tencent, and emerging AI startups making significant strides. These companies are developing cutting-edge AI technologies, such as chatbots and AI-driven models, and investing in hardware like AI chips to enhance their computing capabilities, positioning themselves as global leaders in the rapidly evolving tech landscape. This is creating a favourable China software market outlook.
Tencent Holdings Ltd.
Tencent Holdings Ltd. was founded in 1998 and is headquartered in Shenzhen, Guangdong. It is an internet and technology company which provides entertainment, social media, and financial services.
Baidu Inc.
Baidu Inc. was founded in 2000 and is headquartered in Beijing. It is an internet and artificial intelligence firm that specialises in offering intelligent driving and cloud services, among others.
Huawei Technologies Co., Ltd.
Huawei Technologies Co., Ltd. was founded in September 1987 and is headquartered in Shenzhen, China. It specialises in providing enterprise solutions, ICT services, and consumer devices.
Shinetech Software Inc.
Shinetech Software Inc. was founded in 2001 and is headquartered in New York, United States. It specialises in offering services related to software development, mobile application development, and quality assurance, among others.
Other players included in the China software market report are SAP SE, Microsoft Corp., Oracle Corp., Adobe Inc., Neusoft Corp., and CentLing Technologies Co. Ltd., among others.
- 1 Executive Summary
- 1.1 Market Size 2024-2025
- 1.2 Market Growth 2025(F)-2034(F)
- 1.3 Key Demand Drivers
- 1.4 Key Players and Competitive Structure
- 1.5 Industry Best Practices
- 1.6 Recent Trends and Developments
- 1.7 Industry Outlook
- 2 Market Overview and Stakeholder Insights
- 2.1 Market Trends
- 2.2 Key Verticals
- 2.3 Key Regions
- 2.4 Supplier Power
- 2.5 Buyer Power
- 2.6 Key Market Opportunities and Risks
- 2.7 Key Initiatives by Stakeholders
- 3 Economic Summary
- 3.1 GDP Outlook
- 3.2 GDP Per Capita Growth
- 3.3 Inflation Trends
- 3.4 Democracy Index
- 3.5 Gross Public Debt Ratios
- 3.6 Balance of Payment (BoP) Position
- 3.7 Population Outlook
- 3.8 Urbanisation Trends
- 4 Country Risk Profiles
- 4.1 Country Risk
- 4.2 Business Climate
- 5 Asia Pacific Software Market Overview
- 5.1 Key Industry Highlights
- 5.2 Asia Pacific Software Historical Market (2018-2024)
- 5.3 Asia Pacific Software Market Forecast (2025-2034)
- 6 China Software Market Overview
- 6.1 Key Industry Highlights
- 6.2 China Software Historical Market (2018-2024)
- 6.3 China Software Market Forecast (2025-2034)
- 7 China Software Market by Type
- 7.1 Application Software
- 7.1.1 Historical Trend (2018-2024)
- 7.1.2 Forecast Trend (2025-2034)
- 7.1.3 Breakup by Type
- 7.1.3.1 Enterprise Resource Planning
- 7.1.3.2 Customer Relationship Management
- 7.1.3.3 Enterprise Content Management Software
- 7.1.3.4 Supply Chain Management
- 7.1.3.5 Enterprise Collaboration Software
- 7.1.3.6 Education Software
- 7.1.3.7 Others
- 7.2 System Infrastructure Software
- 7.2.1 Historical Trend (2018-2024)
- 7.2.2 Forecast Trend (2025-2034)
- 7.2.3 Breakup by Type
- 7.2.3.1 Network Management Systems
- 7.2.3.2 Storage Software
- 7.2.3.3 Security Software
- 7.3 Development and Deployment Software
- 7.3.1 Historical Trend (2018-2024)
- 7.3.2 Forecast Trend (2025-2034)
- 7.3.3 Breakup by Type
- 7.3.3.1 Enterprise Data Management
- 7.3.3.2 Business Analytics and Reporting Tools
- 7.3.3.3 Application Servers
- 7.3.3.4 Integration and Orchestration Middleware
- 7.3.3.5 Data Quality Tools
- 7.4 Productivity Software
- 7.4.1 Historical Trend (2018-2024)
- 7.4.2 Forecast Trend (2025-2034)
- 7.4.3 Breakup by Type
- 7.4.3.1 Office Software
- 7.4.3.2 Creative Software
- 7.4.3.3 Others
- 8 China Software Market by Deployment
- 8.1 On-Premises
- 8.1.1 Historical Trend (2018-2024)
- 8.1.2 Forecast Trend (2025-2034)
- 8.2 Cloud
- 8.2.1 Historical Trend (2018-2024)
- 8.2.2 Forecast Trend (2025-2034)
- 9 China Software Market by Organisation Size
- 9.1 Small and Medium Enterprises
- 9.1.1 Historical Trend (2018-2024)
- 9.1.2 Forecast Trend (2025-2034)
- 9.2 Large Enterprises
- 9.2.1 Historical Trend (2018-2024)
- 9.2.2 Forecast Trend (2025-2034)
- 10 China Software Market by Industry Vertical
- 10.1 BFSI
- 10.1.1 Historical Trend (2018-2024)
- 10.1.2 Forecast Trend (2025-2034)
- 10.2 Retail
- 10.2.1 Historical Trend (2018-2024)
- 10.2.2 Forecast Trend (2025-2034)
- 10.3 Healthcare
- 10.3.1 Historical Trend (2018-2024)
- 10.3.2 Forecast Trend (2025-2034)
- 10.4 Government
- 10.4.1 Historical Trend (2018-2024)
- 10.4.2 Forecast Trend (2025-2034)
- 10.5 IT and Telecom
- 10.5.1 Historical Trend (2018-2024)
- 10.5.2 Forecast Trend (2025-2034)
- 10.6 Others
- 11 China Software Market by Region
- 11.1 Shanghai
- 11.1.1 Historical Trend (2018-2024)
- 11.1.2 Forecast Trend (2025-2034)
- 11.2 Zhejiang
- 11.2.1 Historical Trend (2018-2024)
- 11.2.2 Forecast Trend (2025-2034)
- 11.3 Guangdong
- 11.3.1 Historical Trend (2018-2024)
- 11.3.2 Forecast Trend (2025-2034)
- 11.4 Jiangsu
- 11.4.1 Historical Trend (2018-2024)
- 11.4.2 Forecast Trend (2025-2034)
- 11.5 Beijing
- 11.5.1 Historical Trend (2018-2024)
- 11.5.2 Forecast Trend (2025-2034)
- 11.6 Others
- 12 Market Dynamics
- 12.1 SWOT Analysis
- 12.1.1 Strengths
- 12.1.2 Weaknesses
- 12.1.3 Opportunities
- 12.1.4 Threats
- 12.2 Porter’s Five Forces Analysis
- 12.2.1 Supplier’s Power
- 12.2.2 Buyer’s Power
- 12.2.3 Threat of New Entrants
- 12.2.4 Degree of Rivalry
- 12.2.5 Threat of Substitutes
- 12.3 Key Indicators of Demand
- 12.4 Key Indicators of Price
- 13 Competitive Landscape
- 13.1 Supplier Selection
- 13.2 Key Global Players
- 13.3 Key Regional Players
- 13.4 Key Player Strategies
- 13.5 Company Profile
- 13.5.1 Tencent Holdings Ltd.
- 13.5.1.1 Company Overview
- 13.5.1.2 Product Portfolio
- 13.5.1.3 Demographic Reach and Achievements
- 13.5.1.4 Certifications
- 13.5.2 Baidu Inc.
- 13.5.2.1 Company Overview
- 13.5.2.2 Product Portfolio
- 13.5.2.3 Demographic Reach and Achievements
- 13.5.2.4 Certifications
- 13.5.3 Huawei Technologies Co., Ltd.
- 13.5.3.1 Company Overview
- 13.5.3.2 Product Portfolio
- 13.5.3.3 Demographic Reach and Achievements
- 13.5.3.4 Certifications
- 13.5.4 SAP SE
- 13.5.4.1 Company Overview
- 13.5.4.2 Product Portfolio
- 13.5.4.3 Demographic Reach and Achievements
- 13.5.4.4 Certifications
- 13.5.5 Microsoft Corp.
- 13.5.5.1 Company Overview
- 13.5.5.2 Product Portfolio
- 13.5.5.3 Demographic Reach and Achievements
- 13.5.5.4 Certifications
- 13.5.6 Oracle Corp.
- 13.5.6.1 Company Overview
- 13.5.6.2 Product Portfolio
- 13.5.6.3 Demographic Reach and Achievements
- 13.5.6.4 Certifications
- 13.5.7 Shinetech Software Inc.
- 13.5.7.1 Company Overview
- 13.5.7.2 Product Portfolio
- 13.5.7.3 Demographic Reach and Achievements
- 13.5.7.4 Certifications
- 13.5.8 Adobe Inc.
- 13.5.8.1 Company Overview
- 13.5.8.2 Product Portfolio
- 13.5.8.3 Demographic Reach and Achievements
- 13.5.8.4 Certifications
- 13.5.9 Neusoft Corp.
- 13.5.9.1 Company Overview
- 13.5.9.2 Product Portfolio
- 13.5.9.3 Demographic Reach and Achievements
- 13.5.9.4 Certifications
- 13.5.10 CentLing Technologies Co. Ltd.
- 13.5.10.1 Company Overview
- 13.5.10.2 Product Portfolio
- 13.5.10.3 Demographic Reach and Achievements
- 13.5.10.4 Certifications
- 13.5.11 Others
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