Europe favours US software makers over UK

published 30 January 2009

UK software vendors have struggled to match the presence in Europe enjoyed by their US counterparts, new research has found.

Market researcher Pierre Audoin Consultants (PAC) said the UK had a diverse software market that was actually faring well in comparison to it European neighbours.

But, in ranking 200 of the largest software vendors in Europe (based on annual revenue from the region), US firms still dominated with 70 of the top 200 positions and 15 of the top 20 rankings.

The UK accounted for only 34 of the top 200 positions, where just two of the top ten slots were home-grown firms - Sage came in 9th with revenues of 715 million (647.5 million) and Logica was next, ranked 18th with revenues of 297 million (269 million).

Symbian came next, in 30th place with revenues of 182 million (164.8 million). Misys was 49th with 113 million (10.3 million) in software revenues. Northgate took 58th with 110 million (99.6 million), and Reuters rounded out the top-placed UK firms in 68th position with 90 million (81.5 million).

But while they may struggle to match the strength of the US software presence in Europe, UK suppliers weren't doing too badly from a regional perspective. Germany and France accounted for 19 and 20 of the top 200 rankings respectively.

PAC said UK firms tended to remain local or develop larger business outside of Europe, such as Misys' expansion in the US. It also pointed to the recent $775 million (543.9 million) acquisition of US content management firm Interwoven by the UK's Autonomy to boost its North American presence.

Nevertheless, PAC added that it expected the worsening economic climate to accelerate supplier consolidation, particularly among medium-sized players in the European software market.

"Recent deals involving UK players have included Northgate's purchase of Arinso, and Sage's acquisition of numerous UK and European software players (XRT, Tekton, etc.), Fidessa/LatentZero, and Iris/CS Group," it stated.

The researcher also pointed out that, while the US mega-vendors like Microsoft and IBM tend to dominate the systems infrastructure software business, its was the likes of European firms such as SAP and Sage who had strong application software businesses.

A 25-year veteran enterprise technology expert, Miya Knights applies her deep understanding of technology gained through her journalism career to both her role as a consultant and as director at Retail Technology Magazine, which she helped shape over the past 17 years. Miya was educated at Oxford University, earning a master’s degree in English.

Her role as a journalist has seen her write for many of the leading technology publishers in the UK such as ITPro, TechWeekEurope, CIO UK, Computer Weekly, and also a number of national newspapers including The Times, Independent, and Financial Times.