In 2015, the top 10 IT Service Management software vendors accounted for nearly 80% of the global IT Service Management applications market which grew 5% to approach nearly $1.6 billion in license, maintenance and subscription revenues.
Last year ServiceNow, Inc. led the pack with 36% market share and $594 million in IT Service Management product revenues, riding on a 50% jump in license, maintenance and subscription revenues. Atlassian was No. 2 achieving 16% share, IBM was the third at 5% and CA Technologies and BMC Software, Inc. were fourth and fifth place with 5% and 5%, respectively.
Through our forecast period, the IT Service Management applications market is expected to reach $2 billion by 2020, compared with $1.6 billion in 2015 at a compound annual growth rate of 4.0%.
|Exhibit 2: Worldwide IT Service Management Software Market 2015-2020 Forecast, $M|
|Year||2015||2020||2015-2020 CAGR, %|
Source: Apps Run The World, June 2016
IT Service Management Market Definitions And Forecast Assumptions
ITSM applications are being used to make a growing number of employee self-service functions possible through enterprise service management for asset, incident and project management. ITSM applications are considered a derivative market with revenue contribution to functional areas such as Project and Portfolio Management and Enterprise Resource Planning.
Massive software projects to digitize business communities fuel growth of Cloud-based vendors such as Atlassian and ServiceNow as incumbents like BMC and CA race to meet changing IT requirements.
Top 10 IT Service Management Software Vendors
Here are the rankings of the top 10 IT Service Management software vendors in 2015 and their market shares in 2015.
|Rank||Vendor||2014 IT Service Management Apps Revenues, $M||2015 IT Service Management Apps Revenues, $M||YoY Growth||2015 IT Service Management Market Share, %||Recent Developments|
|1||ServiceNow, Inc.||Subscribe||Subscribe||50%||36%||Topping $1B sales in 2015, ServiceNow has signed 230 customers with each paying $1M+ in annualized contract value.|
|2||Atlassian||Subscribe||Subscribe||46%||16%||Raised $462 million in IPO in December 2015.|
|3||IBM||Subscribe||Subscribe||-4%||5%||Converting its traditional ITSM offerings for System z to the Cloud is a work in progress.|
|4||CA Technologies||Subscribe||Subscribe||7%||5%||Acquired Rally Software to shore up ITSM offerings|
|5||BMC Software, Inc.||Subscribe||Subscribe||7%||5%||Saw high double-digit growth in bookings, recurring revenues with its ITSM offerings, while topping 9M subscribers for BMC’s self-service MyIT solution|
|6||HEAT Software||Subscribe||Subscribe||11%||4%||Heat named former Executive Chairman John Ferron, who came from its owner and key investor Clearlake, its new CEO.|
|7||ASG Software||Subscribe||Subscribe||5%||3%||New management team to drive organic growth at the content management vendor.|
|8||Axios Systems||Subscribe||Subscribe||5%||3%||Won inclusion of its ITSM apps in the UK Government’s G-Cloud procurement framework, G-Cloud 7.|
|9||SAP||Subscribe||Subscribe||23%||2%||SAP Solution Manager to deliver test manager and Cloud support enhancements in upcoming Release 7.2.|
|10||Cherwell Software||Subscribe||Subscribe||19%||1%||Achieved record growth in Q3 in 2015 with 65 percent revenue growth and largest sale to date.|
Source: Apps Run The World, June 2016
Exhibit 4 shows the enterprise applications market by functional area. The highest growth functional markets revolve around smaller segments like eCommerce, Enterprise Performance Management, Sales Performance Management and Treasury and Risk, where first movers remain less established than those that for decades have been entrenched in functional areas like ERP, CRM and PLM.
Exhibit 4: Worldwide Enterprise Applications Market Forecast 2015-2020, By Functional Market, $M
IT Service Management Win/Loss Analysis As Part Of Enterprise Applications Buyer Insight Customer Database
On the buyer side, customers are investing in IT Service Management applications based on new features and capabilities that are expected to replace their existing legacy systems. In many cases, competitive upgrades and replacements that could have a profound impact on future market-share changes will become more widespread.
Since 2010, our global team of researchers have been studying the patterns of the latest ITSM software purchases by customers around the world, aggregating massive amounts of data points that form the basis of our forecast assumptions and perhaps the rise and fall of certain vendors and their products on a quarterly basis.
Updated continuously, our database features win/loss extensive analysis. Each year our research team identifies tens of thousands of these customer wins and losses from public and proprietary sources.
The research results are being incorporated into regular updates in our Enterprise Applications Buyer Insight Customer Database. You can access the Quarterly Win/Loss Analysis Scoreboard and our Enterprise Applications Buyer Insight Customer Database by becoming a subscriber.
An expanded version of this report covers the top 20+ IT Service Management Software Vendors, offering in-depth analysis of the market dynamics, vendors’ Strengths, Customers, Opportunities, Risks and Ecosystems as well as their ability to gain Shares (SCORES) within their respective space.
We also offer win-loss analysis of the quarterly wins of these top vendors and whether incumbents and upstarts pose any real threat to their standing amid shifting market requirements and user preferences.
More Enterprise Applications Research Findings
Based on the latest annual survey of 3,000+ enterprise software vendors, Apps Run The World is releasing a number of dedicated reports, which profile the world’s 500 largest Enterprise Applications Vendors (Apps Top 500) and the world’s 500 largest Cloud Applications Vendors (Cloud Top 500) ranked by their 2014-2015 product revenues.
Their 2015 results are being broken down, sorted and ranked across 16 functional areas(from Analytics to Treasury and Risk Management) and by 21 vertical industries(from Aerospace to Utility), as shown in our Taxonomy. Further breakdowns by subvertical, country, company size, etc. are available as custom data cuts per special request.
Each year our global team of researchers conduct an annual survey of thousands of enterprise software vendors by contacting them directly on their latest quarterly and annual revenues by country, functional area, and vertical market.
We supplement their written responses with our own primary research to determine quarterly and yearly growth rates, In addition to customer wins to ascertain whether these are net new purchases or expansions of existing implementations.
Another dimension of our proactive research process is through continuous improvement of our customer database, which stores more than one million records on the enterprise software landscape of over 100,000 organizations around the world.
The database provides customer insight and contextual information on what types of enterprise software systems and other relevant technologies are they running and their propensity to invest further with their current or new suppliers as part of their overall IT transformation projects to stay competitive, fend off threats from disruptive forces, or comply with internal mandates to improve overall enterprise efficiency.
The result is a combination of supply-side data and demand-generation customer insight that allows our clients to better position themselves in anticipation of the next wave that will reshape the enterprise software marketplace for years to come.