ANZ cloud software spend grows by almost a third: IDC

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ANZ cloud software spend grows by almost a third: IDC

Overall software spending in ANZ reached $10.4 billion (US$7.5 billion) in the first half of this year, growing by just over 20 percent year-on-year in both countries, according to new research from analyst firm IDC.

This growth was driven by the acceleration of digitalistion to stay relevant during the pandemic lockdowns, as well as supporting customer, employee and partner experience, IDC said.

Cloud, in particular, has taken a major role in the market as the adoption of cloud services “to increase competitiveness, efficiency, business resiliency and support innovation” has risen 31 percent and now represents 45 percent of the total ANZ software market, the company explained.

This is reflected in the three fastest-growing categories within this market – collaboration applications, AI platforms, and integration and orchestration middleware.

The 49 percent annual growth of collaboration software spending to $358.4 million (US$257.8 million) highlights the major need for remote and hybrid work enablement, as well its benefits for productivity and communications, IDC said, describing this growth as unsurprising.

AI platforms showed the second strongest increase, growing by 35 percent across ANZ, reaching $155 million (US$111.5 million), driven by organisations’ attempts "to stay on top of the game and meet individual customer needs” as they “revamp operational processes, improve customer and business data analysis, support decision-making and forecasting, and, as a result, ensuring flourishing customer experience,” IDC ANZ senior market analyst Anastasia Antonova said.

The need to transition, integrate and ensure all these new platforms are functioning in tandem with legacy systems has seen the market for integration and orchestration middleware grow 31 percent to $203.8 million (US$164.6 million). 

This was driven by legacy modernisation, hybrid integration, workflow/process automation and API-led innovation initiatives, IDC said.

In terms of what IDC expects for the future of the market, integration and API management software will continue to be in demand as cloud adoption only accelerates further to “enable future growth, increased resiliency, agility and competitiveness in the digital-first era,” the company said.

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