Europe’s diverse software sector grows despite downturn

The diverse software sector in Europe has continued to grow despite the economic stagnation on recent years, with the top 100 companies increasing sales by 14% and profits by 56%.

Karl FlindersI am Computer Weekly's services editor. My main focus areas for stories are financial services and outsourcing.

Typically for financial services I write about how the retail and investment banks are harnessing technology and how systems can be used to help companies meet regulations such as Basel II and the Markets in Financial instruments Directive (MiFID).

Outsourcing is relevant across all business and technology sector and focuses on the strategic and cost cutting benefits associated with outsourcing IT.

Topical issues include the insourcing versus outsourcing debate and whether it is better to off-shore, near-shore or on-shore your outsourced technology.

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karl.flinders@rbi.co.uk 020 8652 2068 

The diverse software sector in Europe has continued to grow despite the economic stagnation on recent years, with the top 100 companies increasing sales by 14% and profits by 56%.

In a benchmarking study of 100 European software companies, carried out by venture capital company Truffle Capital, known as the Truffle 100, three UK software companies made it into the top 10.

While SAP is the clear leader, with software sales worth over €12bn in 2010, UK firm Sage was in at number three with sales worth more than €1.5bn in 2010. Autonomy, which is now part of HP, and financial services software maker Misys were the sixth and tenth biggest firms in terms of total sales.

Total revenue generated by the 100 companies in 2010 was €30.9bn, compared with €27.1bn in 2009. Total profit increased to €5.8bn from €3.7bn during the period. The European firms are investing more in research and development, with spending increasing almost 16% to just under €4.5bn.

The research was carried out by Truffle in collaboration with analyst firms IDC and CXP Group. It was supported by the European commissioner for the digital agenda, Neelie Kroes.

Kroes said investment in research and development and recruitment is critical if Europe's software sector is to continue to grow. "These are exactly the right ingredients to sustain the industry's momentum in years to come. The importance of the industry, however, is not just economic, because innovation in software and ICT services also helps address Europe's societal challenges, creating a more equitable and sustainable future for citizens."

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