Worldwide spending on enterprise application software will grow 7.5% to reach $149.9 billion this year, increasing to more than $201 billion by 2019, according to the latest forecast from Gartner Inc. The firm says long-term growth in the market will involve plenty of SaaS solutions and analytics software.

"The majority of spending is going towards modernizing, functionally expanding or substituting long-standing business and office applications with cloud-based software-as-a-service," Bianca Granetto, research director at Gartner, said in a statement.

"Projects have been approved and budgeted for, often over a multi-year period, meaning the pace of spending and adoption isn't subject to any impending urgency," Granetto said.


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The market segments showing the highest growth rate during the forecast period of 2014 through 2019 will be marketing, e-commerce and advanced analytics software, Gartner says.

The research firm identified a number of key trends in the application software market that affect the spending forecast, including the modernization of core enterprise applications; transitioning to new consumption models; and the rise of market dynamics related to digital business.

In addition, organizations will extend or replace human capital management systems with software-as-a-service (SaaS) offerings; increasingly build applications rather than buy them; move more systems and applications to the cloud; and adopt more advanced analytics capabilities.


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