Software Leader Board: OSS Observer's Market Share Report

Most of the market share leaders in the global telecom software market continued to grow revenue in 2007, according to the latest report from OSS Observer, an Analysys Mason company. And most are well-positioned to continue doing so despite economic concerns.

OSS Observer’s Global Detailed Market Share Report for the telecom software market covers 22 different segments within the software space. While many of the leading vendors are ranked in several categories, the aggregate leaders were Amdocs, Ericsson and Oracle Corp. (see Market Share Year over Year Comparison chart).

Market Share Year over Year Comparison

Source: OSS Observer, an Analysys Mason company

Barring some significant acquisitive activity on the part of its competitors, Amdocs’ 13 percent market share should hold up and keep it atop the market for the next couple of years, said Patrick Kelly, partner and co-founder at OSS Observer.

Amdocs is having a record year in 2008, however, CEO Dov Baharav said in the company’s earning call last week that while not giving guidance, Amdocs is preparing for a flat-to-single-digit growth rate in 2009.

Overall, the market generated $17.6 billion in 2007. The top 15 suppliers garnered $9.85 billion of that. Ericsson, Oracle and Alcatel-Lucent followed Amdocs, tied at 6 percent market share. Nokia Siemens Networks was next at 5 percent. Of the top five, only Alcatel-Lucent had a negative growth rate from 2006 to 2007. Besides Amdocs’ 13 percent, the big winners in terms of growth rate were Oracle (17 percent), IBM Corp. (28 percent), Huawai Technologies (30 percent), Comverse (30 percent) and Cisco Systems Inc. (30 percent).

Despite all that growth, Kelly said OSS Observer also is scaling back its projections. “At the beginning of the year, we were forecasting year-over-year growth in the telecom software space at 11 percent. We’re going to take that down to about 4 percent,” he said.

OSS Observer will be releasing its official forecasts in the coming weeks.

Seven out of the top 15 companies in the software space were network equipment manufacturers. That’s due, in most cases, to sales of network management software to support its equipment deployments. It also is indicative of the market size an independent software vendor (ISV) has to reach to crack the top 15.