Dado is part of the preview of the twentieth edition of the Brazilian Software Market Study – Panorama and Trends, which brings perspectives on a global level and also on the Brazilian market
São Paulo, April 11, 2024 – ABES – Brazilian Association of Software Companies presented, during a live open to the public in its YouTube channel, The Brazilian Software Market Study – Panorama and Trends 2024. According to data from the International Data Corporation (IDC) analyzed by ABES, the twentieth edition of the study – considered the main reference for the sector in the country –, Brazil surpassed South Korea and Italy and returned to being among the 10 global powers, with the US＄ 50 billion in investments.
The research shows that Brazil maintained 1.6% of investments in technology globally, and 37.2% of investments throughout Latin America (compared to 36.5% in the previous survey). Considering the total global investments in information technology (software, hardware and services) during 2023 – which was US＄ 3.2 trillion, against US＄ 3.11 trillion in the previous year –, Brazil rose two positions , now ranking in tenth place in this investment ranking, with US＄50 billion invested and leads in Latin America, whose total investments reached US＄134 billion (compared to US＄124 billion in 2022).
Brazil continues to be a reference among countries considered emerging, presenting maturity in IT investments – which prioritizes the values dedicated to software development and increasing the offer of services, distributed in:
30% for the software market (US＄ 15 billion), compared to 26% in the last study (US＄ 11.7 billion);
22% for the services market (US＄ 10.9 billion), against 19.5% in the last study (US＄ 8.8 billion);
48% for the hardware market (US＄23.9 billion), compared to 54.6% in the last study (U＄24.7 billion).
The values above show that the country is moving towards the global average, whose distribution is 31% in software, 26% in services and 43% in hardware.
“The degree of maturity of IT investments is assessed based on the increase in investments in intelligence (Software + Services) versus the decrease in investments in Hardware. In recent years we have seen a decline in the share of hardware in total IT investments, demonstrating that the installed hardware base is already reaching maturity. On the other hand, we saw investments in Software and Services grow and for the first time since we started the Study in 2004, with the sum of investments in Software and Services surpassing investments in Hardware, showing the progress that Brazil has made in terms of maturity of its IT investments”, explains Jorge Sukarie Neto, ABES advisor and responsible for the study.
Another important conclusion of the study is that Brazil continues to be in first place in the ranking of Latin American countries, going from 36.5% of investments in the region, in 2022, to 37.2% in 2023. “It is simply impossible to talk about a Latam market without thinking about Brazil. Our leadership, in this sense, is unquestionable”, details Sukarie.
The trend for 2024 is for global growth of around 7.4%. In Brazil, the index should reach 6%. But, in 2023, the growth of the technology market, at a global level, was 4.1%, with a drop of 0.4% in investments in Brazil. “Although the Software market grew by more than 13% and the Services sector grew by more than 10%, we had a drop of 11% in Hardware. And, as Hardware makes up almost half of investments, this drop ends up pulling the average down, leaving Brazil behind global growth of 4.1%”, concludes Sukarie.
Check out other trends presented firsthand by ABES during the event:
- Private mobile networks: New deployments of private mobile networks in 2024 are expected to exceed US＄ 220M in the lines of Wireless infrastructure, professional services and managed services alone. The lack of an ecosystem that offers end-to-end solutions is a common criticism from end customers. Making this offer concrete will be a key factor in the massification of these networks.
- Internet of Things (IoT): Recent research indicates that by 2024, 50% of companies will be in the planning or proof-of-concept stages for IoT projects. 34% of Brazilian SMBs intend to adopt IoT solutions in the next two years in their business activities. For the Government vertical, this number rises to 50%. Significant growth is expected in 2024, with the Brazilian market reaching the US＄1.7B mark in hardware, software, services and connectivity.
- Cybersecurity: The security solutions market will maintain its robust growth trajectory, reaching around US＄1.7B in Brazil in 2024, which represents growth of more than 16% over the previous year. We will see emerging security technologies, more “modern” and “smart”, gaining space in the global market and landing in Brazil, such as Interconnected SaaS Security, Identity Fabrics, among others.
- Cloud: Cloud data solutions, part of the so-called PaaS, will total US＄1.5B in Brazil in 2024, following its accelerated growth trajectory. This advance also moves the IT services market, which will consume around US$1.4B this year with consultancy, integration and support for data-related projects.
- Artificial Intelligence: Still in the early stages in Brazil, spending on Generative Artificial Intelligence is expected to more than double in 2024 in the country, contributing to Latin America approaching a total of US＄ 120M related to technology. The need to accelerate projects will generate opportunities for IT service providers and consultancies. Spending on AI and Generative AI-related services is expected to exceed US＄459M in 2024.
- Management solutions: This market, which considers packages such as ERP, CRM, planning and production and supply chain, will reach US＄ 5.6B in 2024 in Brazil, which represents growth of 11.6% over the previous year. Of this total, IDC estimates that US$588M will be associated with the intelligence capabilities embedded in these solutions. Analytical and AI platforms will total around US$1.6B this year and will have their importance highlighted in an increasingly data-driven scenario.
- Digital Services: Globally, while On-Premises solutions for network management will start to lose share from 2024 onwards, the Cloud-Based format accelerates 24.3% year on year until 2027. Only software products for Application Performance and Network Performance , expected to reach US＄210M in 2024.
- Edge: Above and beyond a discussion about CAPEX/OPEX, the priority of transforming IT into dynamic cost is now also reaching the Edge environment, favoring business cases. Edge environments composed of hardware, software and services are expected to absorb more than US＄4B by 2025 in Brazil.
- Devices: IDC estimates that the Brazilian Devices market will generate the sum of US＄ 17.2B in 2024, that is, a drop of 0.3% over the adjusted value of 2023. Estimates for some of the Devices segments in 2024:
* Smartphones: US＄9.8B
* Computers: US＄ 4.9B
* Wearables: US＄698M
* Printers: US＄569M
* Tablets: US＄577M - Devices with AI: The launch of several lines of Devices with some type of AI is expected by 2024. Manufacturers point out that such launches will initially be shipped in Premium products and that, by the end of this year, we will have entry-level products with some of these attributes. Premium Notebooks (above US＄ 1,500) will represent 6.9% of this Brazilian market. Premium Smartphones (above US＄800) will represent 5.9% of its market in Brazil.
The preview of the Brazilian Software Market Study – Panorama and Trends 2024 is available for download on this link.
About ABES
ABES (Brazilian Association of Software Companies) aims to contribute to the construction of a more digital and less unequal Brazil, in which information technology plays a fundamental role in the democratization of knowledge and the creation of new opportunities for all. In this sense, it aims to ensure a business environment conducive to innovation, ethical, dynamic, sustainable and globally competitive, always in line with its mission to connect, guide, protect and develop the Brazilian information technology market.
Currently, ABES represents around 2,000 companies, which total approximately 80% of revenue in the software and services sector in Brazil, distributed across 24 States and the Federal District, responsible for generating more than 260 thousand direct jobs and annual revenue in the order of R ＄ 107 billion in 2023. Access the ABES Portal or call +55 (11) 5094-3100.
Press contacts:
ABES | Weber Shandwick Brazil abes@webershandwick.com
Paula Boracini - +55 (11) 98415-0314
Carol Herling – +55 (11) 99553-7756
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