The rising importance of database management will benefit Oracle

Market Realist

Why the world tech sector is poised for major growth in 2014 (Part 5 of 5)

(Continued from Part 4)

The enterprise software market will grow the fastest among the five tech industry segments

According to the Gartner’s report on the technology spending outlook for 2014, the enterprise software market will see the maximum growth among the five markets that comprise the information technology industry. The enterprise software market will grow from $299 billion in 2013 to $320 billion by 2014, at a growth rate of 6.9%—which is more than double the growth that Gartner expects for the overall tech industry.

Richard Gordon, managing vice president at Gartner, said, ”The Nexus of Forces (the convergence of social, mobile, cloud and information) continues to drive growth across key major software markets, such as CRM, database management systems (DBMSs), data integration tools and data quality tools. In fact, organizational adoption of data management technologies to support the Nexus will cause spending on DBMSs to surpass operating systems, making the former the largest enterprise software market in 2014.”

Database management system growth to directly benefit Oracle

The last statement from Gordon is quite interesting. He expects the spending on database management systems (or DBMS) to surpass operating systems, making the former the largest enterprise software market in 2014. This means that Oracle (ORCL) will be biggest beneficiary from this trend shift, as it’s the leading player in the DBMS market. Oracle’s revenue market share of 48.3% as of 2012 is greater than the four closest competitors combined. These competitors are IBM (IBM), Microsoft (MSFT), SAP (SAP), and Teradata (TDC), as the above image shows.

Oracle has been undertaking quite a few initiatives in the database cloud market. The company introduced its Database 12c version last year (the “c” in “12c” stands for “cloud”). According to Oracle, “Oracle Database 12c introduces a new multitenant architecture that simplifies the process of consolidating databases onto the cloud; enabling customers to manage many databases as one — without changing their applications.”

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