9.8 - 10 Percent
Category Intelligence on Product Engineering Services covers the following
The analyst report product engineering services show that the key drivers and constraints are:
ISVs are those who are specialized in developing and selling the software designed for masses. Earlier, the market for ISVs were not found attractive by larger service providers as their competencies were constrained within the application development methodology. In recent times, ISVs prefer ‘as-a-service’, so they require the service provider to invest in the following:
–Reuse, and automation of the code
–Development of knowledge and resolutions to migrate the current product to SaaS
–Reduce the time-to-market by automating the development, testing and delivery processes
Demand for IoT
The software product engineering services are often also known as software product development services, product engineering, or application development and maintenance services. The global product engineering services market size is $800 billion and experts predict the CAGR of the market to be about 10 percent by 2022. The product engineering service market is expected to be valued at $ 1078 in 2021 and $1185 billion by 2022. The software product engineering services consist of major phases. The phases are developing, support, planning, testing, maintenance, and deployment. According to cost break up, the product development phase is at the top as it accounts for 30 percent of the cost.
Product strategy and planning & maintenance and support phases account for 20 percent of the cost each. The product design phase accounts for 17 percent while the product quality assurance or testing accounts for 12 percent. The least cost is accounted for by the product deployment phase. The top global suppliers of the product engineering services market include Luxoft, Accenture, Wipro, Alten Calsoft Labs, HCL, TCS, Altran, Pactera, EPAM, and Cognizant. The market is highly fragmented and competitive. The big players account for the majority of the market share because of the technical capabilities of each of the software product engineering services company.
The contract period can be anywhere between 1 year to 10 years. This is primarily based on the particular requirements of the client. One of the major trends in the software product engineering market is the high adoption rate of IoT. This has helped considerably reduce costs among other benefits. The growth of software product engineering market has been due to the focus on faster product development. The major end-user industries include BFSI, automobiles, telecom, independent software vendors, aerospace, healthcare, and educational institutions. Due to higher investment in R&D, the US is leading in the market. After the US, India, China, Ukraine, Russia, and Romania have a high market share.
The latest trends indicate an increasing interest in the adoption of a cloud-based system in the market as it enables easy scaling up or down depending on the requirements. When a cloud system or a hybrid system is used, storage costs are reduced by a significant amount. Google, Amazon, and Microsoft are the providers who have given rise to cloud-based deployments. Financial institutions such as banks prefer on-premise deployment because of security concerns and regulations. One of the benefits of on-premise systems for banking institutions is there no vendor lock-in.
There are certain drivers and constraints that can boost or hinder the growth of the market respectively. Production time has reduced due to development methods and this has boosted the growth of the market. The demand for IoT has accelerated the market too. ISVs are also drivers of the product engineering services market. Due to an increase in outsourcing, product uniqueness might vanish and this can act as a constraint. Product failure is inevitable in cases where the availability of the product’s key features and functions are not determined before the development phase. Lack of communication between developer and designer can pose a problem too.
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