Software Testing Market Size By Component (Application Testing [By Type (Functional and Non-functional)], Services [Professional and Managed]), By Application (IT & Telecom, BFSI, Manufacturing, Retail, Healthcare, Transportation & Logistics, Government & Public Sector), COVID-19 Impact Analysis, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2021 - 2027
The software testing market is projected to witness significant growth by 2027 owing to rapid digitalization across key regions globally. Moreover, prevalent demand for mobile-based applications and services is likely to propel market growth through the forecast timeline.
Software testing is the process of verifying and evaluating whether a software product or application accomplishes its intended purpose. The advantages of testing include prevention of bugs, reduction of development expenses, and improvement of performance. Software testing is also crucial to improve the reliability of the software and reduce errors. Notably, increasing R&D activities in the software testing technology sector have bolstered industry expansion in recent years.
Furthermore, major industry participants are implementing lucrative strategies to fortify their position in the market by engaging in collaborations, product launches, mergers & acquisitions, and so on, which has enhanced the overall business outlook. For instance, in September 2021, Wood plc, a global engineering and consulting company, entered into a strategic collaboration with National Energy Resources Australia (NERA), the independent, a federally-funded agency operating in the energy resources space, to provide real-time inspection and testing solutions in the offshore energy industry.
Wood developed the Augmented Machine Vision Solution by leveraging its advanced AI technology to provide up-to-date information to help boost the output of the assets. The modern testing technology was designed to eliminate the need for physical asset inspection by technicians and reduce the probability of human error.
The software testing market has been segregated based on application, component, and region. In terms of component, the market has further been classified into application testing [non-functional testing (usability testing, security testing, performance testing, and others) and functional testing (unit testing, smoke testing, system testing, regression testing, integration testing, and others)] and services (managed and professional).
The managed services segment held a sizable market share of around 42% in 2020 and is anticipated to expand at a steady pace over 2021-2027. Growing implementation of machine learning, artificial intelligence, and predictive analytics technologies in the managed services offerings by software testing service providers to gain a competitive edge in the market is likely to boost segmental growth over the following years.
With respect to application, the software testing market has been bifurcated into retail, government & public sector, BFSI, transportation & logistics, manufacturing, IT & telecom, healthcare, and others. The transportation and logistics segment attained nearly 4% market share in 2020 and is slated to witness optimistic growth through the estimated timeline. Increasing R&D initiatives towards autonomous vehicles and electrification of cars is set to drive the adoption of automotive software testing in the coming years.
From the regional perspective, the Latin America software testing market accounted for over 3% of the overall industry revenue in 2020 and is expected to gain significant traction through the forecast period. Proliferation of industrial automation and robotics across Mexico and Brazil is likely to foster regional market outlook in the upcoming years.
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