Software

Estonia

Highlights

The Software market in Estonia is forecasted to achieve a revenue of US$112.20m in the year 2024.
Among the various segments, Enterprise Software holds the largest share with a projected market volume of US$46.83m in the same year.
Looking ahead, the industry is expected to experience a steady annual growth rate of 5.00% (CAGR 2024-2029), resulting in a market volume of US$143.20m by 2029.
In terms of global comparison, United States is anticipated to generate the highest revenue, amounting to US$363.40bn in 2024.
Estonia's software market is thriving, driven by its strong digital infrastructure, tech-savvy workforce, and government support for innovation.

Key regions:

Definition:

In general, software is defined as a set of instructions written as programming code to execute specific tasks on a computing device. The Software market covers a wide range of software products and solutions that are publicly sold by various companies. Most software solutions in this market are designed for professional use, but some can also be suitable for personal use. They can also range from basic productivity tools such as word processors and spreadsheets to complex software solutions such as project management tools, graphic design software, and enterprise resource planning software.

Products in the Software market can be obtained in two ways: as on-premises software that is sold via a transactional license or a subscription and as cloud-based software (software as a service/ SaaS) that is most frequently sold as a subscription.

Structure:

The market contains four markets that are based on the functionality of the software:

Productivity Software refers to application software that supports activities such as producing documents, spreadsheets, drawings, and presentations. This market includes Administrative Software, Collaboration Software, Office Software, Creative Software, and Construction and Design Software.
Enterprise Software refers to all software that supports essential large-scale business activities such as enterprise resource management, customer management, and supply chain activities. This market includes Enterprise Resource Planning Software, Customer Relationship Management Software, Business Intelligence Software, Supply Chain Management Software, Content Management Software, and Other Enterprise Software.
Application Development Software refers to software and tools that help the overall application development process.
System Infrastructure Software refers to software that provides the base framework for operating and managing organizational processes and services on hardware devices.

Additional Information:

The Software market comprises revenue and revenue change as the key performance indicators. Only revenues that are generated by primary vendors at the manufacturer price level either directly or through distribution channels (excluding value-added tax) are included, and revenues generated by resellers are excluded. Revenues are generated through both online and offline sales channels and include spending by consumers (B2C), enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players in this market include Microsoft, Adobe, SAP, Oracle, and Salesforce.

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Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

Estonia, a small country in the Baltic region, has been making waves in the tech industry in recent years. The country has become a hub for startups and technology companies, with a strong focus on software development.

Customer preferences: Estonia's location in Europe, with close proximity to both Western and Eastern markets, has made it an attractive location for software companies looking to expand their reach. The country's highly educated workforce, with a strong emphasis on STEM education, has also made it an ideal location for companies looking to hire skilled software developers.

Trends in the market: The software market in Estonia has been growing steadily in recent years, with a focus on developing cutting-edge technology for a variety of industries. One trend that has emerged in the market is the rise of cloud-based software solutions, which offer greater flexibility and scalability for businesses. Another trend is the increasing use of artificial intelligence and machine learning in software development, which has led to the creation of more sophisticated and intelligent software products.

Local special circumstances: One unique aspect of the software market in Estonia is the country's e-government system, which has been in place for over a decade. The system allows citizens to access government services online, and has served as a model for other countries looking to implement similar systems. This focus on digital innovation has helped to create a supportive environment for technology companies in Estonia, and has led to the development of a thriving startup ecosystem.

Underlying macroeconomic factors: Estonia's strong economic growth in recent years has also contributed to the growth of the software market. The country has a low corporate tax rate and a business-friendly environment, which has attracted foreign investment and led to the creation of many new businesses. Additionally, Estonia's membership in the European Union has given it access to a large market of potential customers, which has helped to drive demand for software products. Overall, the combination of a highly skilled workforce, a supportive business environment, and a focus on digital innovation has made Estonia an attractive location for software companies looking to expand their reach.

Data coverage:

The data encompasses B2B, B2G, and B2C enterprises, except for the Enterprise Software segment, in which consumer (B2C) spending is not considered. Figures are based on the allocation to the country where the money was spent at manufacturer price level (excluding VAT).

Modeling approach / Market size:

Market sizes are determined through a top-down approach with a bottom-up validation, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and reports from our primary research. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, level of digitization, GDP sector composition, and observed level of software piracy. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. The main drivers are the GDP and the level of digitization.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.