Application Management Services Market Size, Share & Trends Analysis Report By Service (System Integration, Support & Maintenance), By Deployment, By Application, By Region, And Segment Forecasts, 2018 - 2025

Industry Insights

The global application management services market size was valued at USD 56.62 billion in 2017. The demand for next-generation technology integration, coupled with the need to align legacy systems with the evolving business structure, is driving the application management services market growth. Trends such as cloud migration, mobility, social tools, and integrated platform as a service are expected to have a profound effect on the service delivery models.

Businesses are striving to adapt to the ever-changing demands of customers through the development of systems of innovation and differentiation and by inculcating new processes and delivery models, such as continuous delivery and integration. Besides these capabilities, industry vendors also offer numerous others such as modernization, migration, redeployment, and architectural redesigning. As such, the application services market is anticipated to grow at a healthy growth rate in the coming years. A major part of the application services is focused on enterprise applications, such as customer relationship management, enterprise resource planning, and human resource management services, which are provided by software vendors such as SAP, Oracle, and Microsoft. As an increasing number of small and medium businesses add these complex applications to their portfolio, their monitoring and management services demand is expected to rise.

Application development and maintenance services are witnessing a dramatic change owing to the emergence of technologies such as DevOps and legacy systems, which help increase the demand for application lifecycle management services. As the industry matures, vendors are anticipated to leverage industry collaborations, platform integration, and strategic alliances to capitalize on market growth. The industry is also expected to showcase a propensity toward commercial off-the-shelf solutions and efforts to increase the geographic reach and client portfolio with both organic and inorganic expansion.

Services Insights

The industry has been segregated into system integration, support and maintenance, database management, consulting, modernization, and other service segments. Of these, the support and maintenance segment emerged as the most dominant in the industry in terms of market size, which can be attributed to the large-scale demand from large enterprises and small and medium businesses alike.

Owing to the increasing shift toward web-based deployment, social media integration, and rapid digitalization, the modernization segment has been exhibiting an impressive growth rate. Application management consulting is also anticipated to witness a substantial rise in demand over the forecast period.

Deployment Insights

The emergence of Software as a Service (SaaS) has had a significant impact not only on the customer perception and requirements but also on the buying decisions of CIOs. As the SaaS model affords ease of adapting to changing business pace, agility, improved performance, and a lower total cost of ownership, the adoption of cloud is set to increase in the coming years. Changing business dynamics, such as insistence for lesser time-to-market and real-time incident management, are set to define the pace at which cloud deployment will be accepted in the industry. The on-premise segment, though often offers greater security and customization services, is set to lose ground to the onslaught of cloud services.

Application Insights

The banking, financial services, and insurance segment is the largest adopter of application services in the market owing to the criticality of operations and the sheer complexity of functions and applications. The high pressure on the industry to reduce costs and increase margins in a sluggish economy is anticipated to fuel the increasing shift toward managed services.

The healthcare industry may exhibit a growing propensity toward application monitoring and management in the coming years and will be closely followed by the public sector. The lack of competitive IT staff, increasing scope of operations, and incessant demand to match pace with the changing technological scenario are driving the public-sector application services growth.

Regional Insights

Being a mature market for technological solutions and their implementation, the North American region is expected to lead in the application services demand in terms of size. The sprawl of emerging technologies in the region, such as cloud, social media, analytics, and digitalization, is also responsible for the large industry size. In addition, the large size of the outsourcing industry and high pressure for reducing IT costs are compelling companies to look for alternative ways to control spending.

The Asia Pacific region is estimated to grow the fastest over the forecast period, owing to the growing demand from developing countries such as China and India. The presence of many large vendors in the region is also conducive to the region’s growth. The Middle Eastern and African region is estimated to follow the Asia Pacific region in terms of growth rate and is expected to grow at a CAGR of 6.0% in the coming years.

Application Management Services Market  Share Insights

The industry is marked by the presence of many large technology companies such as Cognizant Technology Solutions Corp., Accenture plc, IBM Corp, Capgemini Group S.A., and Deloitte Touche Tohmatsu Ltd. Some other prominent players include Tata Consultancy Services Ltd., Atos SE, Computer Science Corp., L&T Infotech, Infosys Ltd., NTT Data Corp., Mahindra Systems, and Wipro Ltd.

Mergers and acquisitions have been a major industry trend for the inorganic growth in the marketplace and many large companies employ it regularly to gain an edge. For example, in 2015, Capgemini acquired iGATE, a technology service provider operating from New Jersey, U.S., to expand its reach and clientele.

Market Segments Covered in the Report

This report forecasts revenue growth at global, regional & country levels and provides an analysis of the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this report, Grand View Research has segmented the application management services market report on the basis of service, deployment, application, and region:

• Service Outlook (Revenue, USD Million; 2014 - 2025)

  • System Integration

  • Support & Maintenance

  • Database Management

  • Consulting

  • Modernization

  • Others

• Deployment Outlook (Revenue, USD Million; 2014 - 2025)

  • On-premise

  • Cloud

• Application Outlook (Revenue, USD Million; 2014 - 2025)

  • BFSI

  • Healthcare

  • IT and Telecom

  • Retail

  • Public Sector

  • Others

• Regional Outlook (Revenue, USD Million; 2014 - 2025)

  • North America

    • The U.S.

    • Canada

    • Mexico

  • Europe

    • UK

    • Germany

  • Asia Pacific

    • China

    • Japan

    • India

  • South America

    • Brazil

  • Middle East & Africa (MEA)