Cloud, Mobile, GenAI Driving ADM Growth in Germany

Rhea-AI Summary

Germany's application development and maintenance (ADM) services market is experiencing significant growth, driven by cloud computing, mobile applications, and GenAI adoption. The mobile app market has surged 78% over four years, while cloud computing grows at 25% annually, making Germany Europe's largest cloud market. Enterprises are increasingly seeking localized expertise to ensure security compliance and cultural adaptation. As Europe's second-largest security technology market, Germany emphasizes cybersecurity in development. However, the country faces a significant shortage of skilled software developers, particularly in data engineering and DevOps, while requiring specialized talent for German-language AI model training.

Positive

• Mobile app market surge of 78% over four years
• Cloud computing market growing at 25% annually
• Largest cloud computing market in Europe
• Second-largest security technology market in Europe
• Second-largest number of startup firms in Europe

Negative

• Significant shortage of skilled software developers
• Lack of specialized practitioners for German-language AI model training

Insights

Technology Market Analyst

The German ADM services market shows remarkable growth dynamics, with cloud computing expanding at 25% annually and mobile app demand surging 78% over four years. This growth trajectory, coupled with Germany's position as Europe's largest cloud market, signals strong business opportunities for ISG (III).

The market's evolution is particularly noteworthy in three key areas: cloud-native development, cybersecurity integration and GenAI adoption. The severe shortage of skilled developers, especially in data engineering and DevOps, creates both a challenge and opportunity for service providers who can bridge this gap.

For ISG, this market environment presents significant revenue potential through their advisory services, as companies seek guidance on digital transformation and vendor selection. The emphasis on localized expertise and compliance requirements strengthens ISG's position as a trusted advisor in the German market.

Enterprises increasingly seeking customized platforms and solutions to meet requirements of local markets, ISG Provider Lens™ report says

FRANKFURT, Germany--(BUSINESS WIRE)-- Germany’s growing reliance on cloud computing and mobile applications is driving increased demand for application development and maintenance services, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2024 ISG Provider Lens™ Next-Gen ADM Services report for Germany finds the growing demand for software services is being fueled by digital transformation initiatives, industry 4.0 adoption and increasing need for mobile applications in such areas as e-commerce, finance, healthcare and entertainment.

The market for mobile apps in Germany is booming, surging 78 percent over a four-year period, the report notes. Amid this expansion, enterprises are seeking more localized expertise from ADM partners, to ensure high security standards, compliance with regional regulations, and the ability to adapt software to the cultural nuances of end users.

“Our German clients are increasingly demanding customized platforms and solutions that address the specific market requirements of the regions and localities where they do business,” said Matthias Paletta, director, technology modernization, for ISG in Germany. “These enterprises are seeking partners with localized expertise, who can tailor their services to meet these demands.”

Germany has emerged as Europe’s largest cloud computing market, growing at a 25 percent annual rate. This rapid growth is reshaping the application development landscape, with developers increasingly focused on cloud-native applications, microservices-based architectures, and serverless computing. The need for scalability, flexibility and cost-effectiveness is paramount.

Security is also a top concern. Germany is Europe’s second-largest market for security technology and places a strong emphasis on cybersecurity in applications development. The government’s High-Tech Strategy actively supports security-oriented research projects, influencing development practices toward secure coding, robust authentication mechanisms and enhanced data protection.

With the second-largest number of startup firms in all of Europe, Germany is among the world’s principal centers of innovation in fields such as generative AI (GenAI). However, the country needs more skilled practitioners capable of training large language models (LLM) to adapt to the often unique, detailed and distinctive requirements of the German language.

Germany faces a significant shortage of skilled software developers, particularly in data engineering, software engineering and DevOps, the report says. Companies are addressing this issue by investing in training programs, partnering with educational institutions and exploring remote work options to access a wider talent pool.

“What is required of German enterprises today is to make their innovations teachable to a new generation of developers,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “There is enormous potential value in the human capital they could be cultivating. Modern application development platforms can help them achieve this.”

The report notes that the German federal government is actively promoting digital transformation in schools and public administration. This initiative is creating new opportunities for application developers in the public sector, focusing on e-government solutions, digital education platforms and smart city applications.

For more insights into how the evolution of Germany’s business and regulatory environment is placing stress on its developer workforce, and ISG’s advice for addressing these challenges, see the ISG Provider Lens™ Focal Points briefing, available on this webpage.

The 2024 ISG Provider Lens™ Next-gen ADM Services report for Germany evaluates the capabilities of 24 providers in a single quadrant, Agile Application Development Projects. The report names Allgeier, Computacenter, DATAGROUP, Materna, msg systems, and Zeiss Digital Innovation as leaders in this quadrant.

In addition, Coforge and PCG are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in this Agile Projects quadrant.

In the area of customer experience, Persistent Systems is named the global ISG CX Star Performer for 2024 among ADM Services providers. Persistent Systems earned the highest customer satisfaction scores in ISG's Voice of the Customer survey, part of the ISG Star of Excellence™ program, the premier quality recognition for the technology and business services industry.

A customized version of the report is available from Materna.

The 2024 ISG Provider Lens™ Next-Gen ADM Services report for Germany is available to subscribers or for one-time purchase on this webpage.

About ISG Provider Lens™ Research

The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Mexico, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

About ISG

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including AI, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,600 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241025331463/en/

Press:



Philipp Jaensch, ISG

+49 151 730 365 76

philipp.jaensch@isg-one.com



Matthias Longo, for ISG

+49 152 341 464 63

matthias@longo-pr.de

Source: Information Services Group, Inc.

FAQ

What is the growth rate of Germany's cloud computing market according to ISG (III)?

According to ISG, Germany's cloud computing market is growing at a 25% annual rate, making it Europe's largest cloud computing market.

How much has the German mobile app market grown according to ISG's (III) 2024 report?

The German mobile app market has surged 78% over a four-year period according to ISG's 2024 report.

What are the main challenges in Germany's ADM services market identified by ISG (III)?

The main challenges include a significant shortage of skilled software developers, particularly in data engineering, software engineering, and DevOps, as well as a lack of practitioners capable of training AI models for German language requirements.