Brief Excerpt from Industry Overview Chapter:
Companies in this industry design and publish computer software. Major companies include US-based Activision Blizzard, Adobe Systems, IBM, Microsoft, Oracle, Salesforce.com, and Symantec, as well as Dassault Systemes (France), The Sage Group (UK), and SAP (Germany).
Global revenue from sales of packaged software is about $430 billion per year, according to International Data Corporation. The US is the world’s top software-producing country in terms of revenue; other major producers include Germany, the UK, and Japan. Many US-based software companies outsource some of their production work to other countries due to the high cost of domestic labor.
The US computer software industry involves about 9,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $170 billion.
The US economy heavily influences business spending for software products. The success of packaged-software companies depends on technical expertise and effective marketing. Small software companies compete mainly by targeting niche markets or developing new technology. Many small companies form alliances with larger ones to market their products. The US software industry is concentrated: the 50 largest companies generate about 70% of revenue.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major product categories include application software (such as enterprise and accounting software, office suites, and games), which accounts for about 45% of industry revenue. System software — including operating systems, network and database management software, and related development tools — makes up about 20%. Some companies also provide IT support, consulting, and training...
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