the changing landscape of software

TBR

TECHNOLOGY BUSINESS RESEARCH, INC.

The Changing Landscape of SoftwareInsights from TBR’s 1Q14 Software Vendor Benchmark

July 16, 2014

TBR

2 TBR Quarterly Webinar Series | 7.16.14 | www.tbri.com | ©2014 Technology Business Research Inc.

Insights from TBR’s 1Q14 Software Vendor Benchmark: Webinar Presenters

Elizabeth Hedstrom Henlin Senior Analyst, Software and Applications

Email: [email protected] Twitter: @EAHHTBR

Matt Healey Principal Analyst, Software and Applications

Email: [email protected] Twitter: @Mhealey_TBR

Christian Perry Content Manager, Data Center

Email: [email protected] Twitter: @ITwriter

mailto:[email protected]



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Insights from TBR’s 1Q14 Software Vendor Benchmark: Webinar Agenda

• Insights from TBR’s 1Q14 Software Vendor Benchmark

Current Market State

• Insights from TBR software market coverage:• Business Intelligence• In-memory computing• Mobile device management (MDM)

2015 Market Outlook

TBR


Current State of the Software Market Landscape

TBR


MSFT

SAP

AUTODESK

CA TECHNOLOGIES

CHECK POINTEMC

CITRIX

INTUIT

COMMVAULT

COMPUWARE

HP SW

IBM

INFORMATICA

NETSUITE

OPEN TEXT

ORACLE

RED HAT

SYMANTEC

SAGE

SALESFORCE

SOFTWARE AG

TIBCO

TOTVS

TREND MICRO

VMWARE

PROGRESS

ADOBE-10.0%

10.0%

30.0%

-15.0% 0.0% 15.0% 30.0%

Avg.

Ann

ual R

even

ue G

row

th

1Q14 Revenue GrowthAverage Quarterly Revenue Growth = 8.2%

Average Annual Revenue Growth Year-to-Year = 12.4%

1Q14 REVENUE GROWTH VS. AVERAGE ANNUAL REVENUE GROWTH TBR

ACTUATE(-31.0%, -10.8%)

TABLEAU(86.3%, 85.6%)

DELL ENTERPRISE SOFTWARE(24.0%, 128.2%)

Software revenue leaders grew by attacking competitors’ install bases; niche players marketed unique use cases to gain attention

Insights from TBR’s 1Q14 Software Vendor Benchmark: Market Overview

Changing software deployment models and integration strategies provide an opportunity for software firms across segments to drive revenue growth

SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES

SLIPPING

LAGGARDS

LEADERS

IMPROVING

NOTE: SPHERE SIZE REFLECTS VOLUME OF REVENUE.

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MSFT

CA TECHNOLOGIES

CHECK POINT

CITRIX

COMMVAULT

COMPUWARE

IBM

INFORMATICA

EMC

INTUIT

ORACLEAUTODESK

HP SW

SAGE

SAP

SOFTWARE AG

SYMANTEC

TIBCO

TREND MICRO

VMWARE

TOTVS

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

-20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

Corp

orat

e Re

venu

e Gr

owth

License Revenue Growth

Average License Revenue Growth Year-to-Year = -0.3% Average Corporate Revenue Growth Year-to-Year = 8.2%

1Q14 LICENSE GROWTH VS. CORPORATE GROWTH TBR

TABLEAU(83.3%, 86.3%)

ACTUATE(-59.8%, -31.0%)

ADOBE(-30.2%, -0.8%)

OPENTEXT(5.9%, 31.1%)

PROGRESS(-25.6%, -11.0%)


The expanding cloud market will continue to challenge license revenue growth, but leaders are riding high-interest use cases to sales success

Insights from TBR’s 1Q14 Software Vendor Benchmark: Key Trends

SLIPPING

LAGGARDS

LEADERS

IMPROVING


Revenue growth leaders, such as Tableau, targeted specific industry verticals to create demand for core products

TBR


MSFT

SAP

SYMANTEC

AUTODESK

CA TECHNOLOGIES

CHECK POINT

EMC

CITRIX

COMMVAULT

HP SW

INFORMATICA

IBM

NETSUITEOPEN TEXT

ORACLE

RED HAT

SAGESOFTWARE AG

TIBCOTOTVS

TREND MICRO

VMWARE

PROGRESS

DELL ENTERPRISE SOFTWARE

ADOBE

COMPUWARE

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

-20.0% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

Corp

orat

e Re

venu

e Gr

owth

Corporate Operating MarginAverage Corporate Operating Margin = 16.7%

Average Corporate Revenue Growth Year-to-Year = 8.2%

1Q14 REVENUE GROWTH VS. OPERATING MARGIN TBR

SALESFORCE(-4.5%, 37.4%)

TABLEAU(-2.5%, 86.3%)

INTUIT(62.6%, 14.2%)

ACTUATE(-18.8%, -31.0%)

Many revenue leaders promote messages of profitable growth to distract from challenges to core businesses


Insights from TBR’s 1Q14 Software Vendor Benchmark: Key Trends

Realigning resources and capitalizing on seasonal market demands enabled leading software vendors to improve operating margins in 1Q14


SLIPPING

LAGGARDS

LEADERS

IMPROVING

TBR


TBR Outlook for 2014:Software Vendor Analysis

TBR


Evolving business intelligence (BI) use cases: Pure plays challenge traditional vendors by carving out niche value propositions.

“Database wars” heating up: In-memory is key to revenue growth opportunities.

Mobile device management (MDM): MDM is no longer ancillary but essential to customers’ collaboration policies.

Changes in expectations and software delivery models drive vendors to develop additional analytics, mobile and industry-specific functionality

Insights from TBR’s 1Q14 Software Business Quarterly Reports: Market Outlook

Software Vendor Outlook for 2014

TBR


BI and analytic functions are essential to enhancing platforms, and nimble pure-play vendors have the ability to innovate quickly to meet demand

Insights from TBR’s 1Q14 Quarterly Reports: Covered Vendor Research Highlights

• IBM uses developer engagement to demonstrate the viability of analytics offerings, shortening the sales cycle of its core cognitive computing portfolio and positioning Watson for material 2015 revenue contributions.

• In April Microsoft announced three additions to its analytics portfolio, including an Azure Intelligent Systems Service for the analysis of M2M data and new analytics tools integrated into Excel, enabling the company to drive cross-portfolio growth to capitalize on opportunity in the emerging market.

• Pure-play vendors such as Splunk and Tableau will continue to be thorns in the side of entrenched software vendors moving into the BI and analytics space.

Highlighted Case Studies: 1Q14 TBR Software Business Quarterly Vendor Reports

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Growth of BI and analytics adoption encouraged vendors to develop in-memory functionality to boost application run time for customers

• SAP HANA’s successful management of corporate workloads associated with BI and analytics tasks resulted in established database vendors increasing investments in in-memory technologies to innovate ahead of market demand.• Although SAP HANA is the leading in-memory solution, in

terms of profile, TBR believes the drawbacks associated with undergoing an end-to-end database overhaul will give trailing vendors a window of opportunity to develop in-memory functionality to defend install bases. • TBR expects in-memory technologies to be essential for

database vendors, highlighted by Oracle’s investments in its Database 12c offering and development of integrated in-memory capabilities and Microsoft’s recent update for its SQL Server 2014 to expand upon in-memory features.



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BYOD expectations accelerate investments in MDM technologies as customer concerns over data security continue to rise

• Microsoft’s acquisition of GreenButton in April adds high-performance compute capabilities to Azure that enable Microsoft to more effectively compete with competitive offerings such as Google Compute and Amazon EC2 while also catering to industries with compute-intensive workloads.

• Software AG bolstered its mobile portfolio in 1Q14 with its acquisition of metaquark, a mobile application specialist. Software AG will integrate metaquark’s mobile application capabilities in its Intelligent Business Operations and webMethods Business Process Management suites to enable management and monitoring capabilities of mobile devices.



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Projections

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Partners will continue to play a pivotal role in broadening sales reach, while infrastructure investments will support portfolio adoption

Leverage alliances to

drive application sales and

integrations.

Expand infrastructure to extend

seamless delivery.

Revenue and growth

opportunities for additional

enterprise software sales at

competitors’ expense

2015 Projections: Go-to-Market and Infrastructure Investments will Drive Competitive Wins

Insights from TBR’s 1Q14 Software Vendor Benchmark: Market Projections

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Questions?

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Insights from TBR’s 1Q14 Software Vendor Benchmark: Contact Information

James McIlroy Vice President of SalesEmail: [email protected]: 603.929.1166

Twitter: @TBRincSlideShare: www.slideshare.net/TBR_Market_InsightYouTube: www.youtube.com/user/TBRIChannelLinkedIn: https://www.linkedin.com/company/technology-business-research

Elizabeth Hedstrom Henlin Senior Analyst, Software and Applications

Email: [email protected] Twitter: @EAHHTBR

Matt Healey Principal Analyst, Software and Applications

Email: [email protected] Twitter: @Mhealey_TBR

Christian Perry Content Manager, Data Center

Email: [email protected] Twitter: @ITwriter


https://twitter.com/TBRinc

http://www.slideshare.net/TBR_Market_Insight

http://www.youtube.com/user/TBRIChannel

https://www.linkedin.com/company/technology-business-research




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Syndicated Research Coverage by Vendor SegmentSoftware Vendor Reports(Software Business Quarterly)

Benchmarks and Market Landscapes(Benchmark XLS data is also available)

• CA Technologies• Dell Software*• HP Software• IBM Software• Microsoft Corp.• Oracle Corp.• Red Hat• SAP AG• SAS*• Symantec• VMware

• Software Vendor BenchmarkThe benchmark currently covers 30 firms, encompassing software license, maintenance and professional services revenue.

• Business Intelligence Software Vendor Benchmark*The benchmark includes BI business of select Software Business Quarterly vendors and additional pure-play firms (35 planned for CY2Q14).

TBR Software Practice Syndicated Coverage

*Semiannual publication; **Annual publication

SourceIT — IT Customer Segment ReportsInsight and in-depth study results on N. American and large enterprise budgeting, buyers and competitors across workloads

• SourceIT Banking & Financial Services**• SourceIT Healthcare**

• SourceIT Public Sector**• SourceIT Retail**• SourceIT Telecom**

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