PUBLISHER: The Business Research Company | PRODUCT CODE: 1425235
PUBLISHER: The Business Research Company | PRODUCT CODE: 1425235
Application Modernization Services Global Market Report 2024 from The Business Research Company provides strategists, marketers and senior management with the critical information they need to assess the market.
This report focuses on application modernization services market which is experiencing strong growth. The report gives a guide to the trends which will be shaping the market over the next ten years and beyond.
Where is the largest and fastest growing market for application modernization services? How does the market relate to the overall economy, demography and other similar markets? What forces will shape the market going forward? The application modernization services market global report from the Business Research Company answers all these questions and many more.
The report covers market characteristics, size and growth, segmentation, regional and country breakdowns, competitive landscape, market shares, trends and strategies for this market. It traces the market's historic and forecast market growth by geography.
Application modernization involves the process of updating older software to align with newer computing methodologies, aiming to enhance agility, foster innovation, reduce costs and risks, and ultimately streamline business operations for growth. Application modernization services are instrumental in revitalizing older software by incorporating new computing approaches, including the adoption of newer languages, frameworks, and infrastructure platforms.
The primary types of application modernization services encompass COBOL, ADA, PL/1, RPG, assembler, power builder, and other variations. COBOL, for example, is utilized for migrating COBOL applications either in mass or through staged processes to the preferred programming language and platform. COBOL, which stands for Common Business-Oriented Language, is a high-level programming language designed for business computer programs, commonly used in industries such as finance and human resources. Various cloud development modes, including private cloud, public cloud, and hybrid cloud, play a significant role in the application modernization landscape. Different types of applications targeted for modernization include post-modernization, application portfolio assignment, UI modernization, cloud application mitigation, application integration, and application re-platforming. The application modernization services cater to diverse industry verticals such as BFSI, healthcare, life sciences, telecommunications, IT and ITeS, retail and consumer goods, government and public sector, energy and utilities, manufacturing, and other sectors.
The application modernization services market research report is one of a series of new reports from The Business Research Company that provides application modernization services market statistics, including application modernization services industry global market size, regional shares, competitors with an application modernization services market share, detailed application modernization services market segments, market trends and opportunities, and any further data you may need to thrive in the application modernization services industry. This application modernization services market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.
The application modernization services market size has grown rapidly in recent years. It will grow from $18.37 billion in 2023 to $21.58 billion in 2024 at a compound annual growth rate (CAGR) of 17.5%. The growth observed in the historical period can be attributed to several factors, including business process optimization, the pursuit of cost efficiency, enhancements in user experience, challenges in data management, increased market competition, and the imperative for innovation. These elements collectively played a crucial role in shaping the growth trajectory during the historic period.
The application modernization services market size is expected to see rapid growth in the next few years. It will grow to $42.64 billion in 2028 at a compound annual growth rate (CAGR) of 18.6%. The anticipated growth in the forecast period can be attributed to various factors, including the adoption of mobile-first strategies, the dynamics of remote work, evolving customer expectations, requirements for elastic scalability, considerations for data privacy and compliance, and a heightened focus on environmental sustainability. Key trends expected in the forecast period include the increased adoption of cloud-native approaches, the implementation of microservices architecture, the utilization of containerization and orchestration, integration with DevOps practices, an API-first approach, heightened emphasis on security and compliance, and the adoption of hybrid and multi-cloud strategies.
The application modernization services market is poised for growth owing to an increasing number of businesses embracing digital technologies and applications. These technologies encompass electronic systems, devices, and resources that handle data storage, generation, or processing. Services for application modernization assist businesses in revamping their IT infrastructure and applications using state-of-the-art technologies. For example, based on a survey conducted by Accenture plc in June 2021, 81% of healthcare executives reported an accelerated pace of digital transformation within their organizations, with 93% expressing a sense of urgency and a call to action for innovation. The Digital Health Technology Vision survey involved 399 healthcare executives across six countries, highlighting the significant push towards digital transformation and its impact on the application modernization services market.
The growing utilization of cloud computing is anticipated to be a major driver for the expansion of the application modernization services market. Cloud computing involves providing a variety of computing services over the internet, including servers, storage, databases, networking, and more. This technology offers a scalable and adaptable infrastructure, allowing businesses to easily adjust their applications according to demand. Application modernization services aid organizations in adapting existing applications to leverage the scalability and flexibility offered by cloud platforms. For instance, Eurostat reported in December 2021 that 41% of EU enterprises utilized cloud computing, primarily for hosting email systems and storing electronic files. Notably, large businesses in the EU demonstrated a 72% adoption rate of cloud computing in 2021, a significant increase from 2020 by 7 percentage points. This surge in cloud utilization contributes significantly to the growth of the application modernization services market.
Technological advancements stand out as a prominent trend in the application modernization services market. Leading companies within this domain are integrating innovative technologies, like the SMART Modernization service, which capitalizes on AI, machine learning, and accelerated digital transformation to enhance their market competitiveness. For instance, Cloudreach, a USA-based multi-cloud services company, introduced SMART Modernization in June 2021. This service features components such as Sunstone, an AI-powered software platform that identifies opportunities for application modernization and offers actionable plans. Additionally, the inclusion of DevOps as a Service provides Cloudreach's broad cloud expertise through a flexible monthly subscription, facilitating the modernization of applications by strategizing, launching, and maintaining cloud modernization initiatives.
Major players within the application modernization services market are intensifying their focus on product development, particularly in the realm of AI-powered assistants, to fortify their market standing. AI-powered assistants, specifically enterprise coding assistants, are software tools leveraging artificial intelligence to aid developers in writing code swiftly and accurately. For instance, in October 2023, International Business Machines Corporation (IBM), a renowned US-based multinational technology and consulting company, unveiled Watsonx Code Assistant. This cutting-edge generative AI-powered assistant targets enterprise developers and IT operators, enhancing their coding efficiency and precision. The tool's innovative approach employs natural language prompts to streamline coding processes, catering to two significant enterprise use cases. Firstly, it supports IT automation through Watsonx Code Assistant for Red Hat Ansible Lightspeed, enabling tasks like network configuration and code deployment. Secondly, it addresses mainframe application modernization with Watsonx Code Assistant for Z, facilitating the translation of COBOL to Java. IBM's Watsonx Code Assistant aims to bolster coding productivity by harnessing AI's capabilities to comprehend and respond to natural language queries, simplifying intricate coding tasks for enterprise users.
In September 2021, Fresche Solutions, a Canadian provider specializing in information technology and application modernization services, completed the acquisition of Abacus Solutions LLC, a US-based company, for an undisclosed amount. This strategic acquisition further solidifies Fresche's commitment to empowering customers in maximizing the potential of their IBM I systems as a linchpin for IT innovation and digital transformation, all while mitigating modernization time, risk, and expenditure. Abacus Solutions LLC, the acquired entity, is recognized for its provision of information technology hardware and services, enhancing Fresche's capacity to deliver comprehensive and effective modernization solutions to its clientele.
Major companies operating in the application modernization services market report are Accenture plc, Aspire Systems Inc., Asysco Inc., Bell Integrator Inc., Blu Age Corp., Capgemini SE, Cognizant Technology Solutions Corporation, Dell Inc., DXC Technology Company, EPAM Systems Inc., HCL Technologies Limited, Hexaware Technologies Limited, IBM Corporation, Infosys Limited, Micro Focus International plc, Microsoft Corporation, Modern Systems Inc., Oracle Corporation, Tata Consultancy Services Limited, Tech Mahindra Limited, The Software Revolution Inc., Wipro Limited, Atos Information Technology Incorporated, Deloitte Touche Tohmatsu LLC, Cuelogic Technologies Pvt. Ltd., Mindtree Consulting Private Limited, Larsen & Toubro Infotech Ltd., Virtusa Consulting Services Private Limited, Nippon Telegraph and Telephone Public Corporation, Trianz Holdings Private Limited, Persistent Systems and Solutions Limited, Sonata Software Ltd.
North America was the largest region in the application modernization services market in 2023. The regions covered in the application modernization services market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
The countries covered in the application modernization services market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.
The application modernization services market includes revenues earned by entities by providing rehosting, rearchitecting and recoding application modernization services. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.
The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).
The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.