This IDC study forwards a reliable approach to addressing a vexing question that has dogged the software industry: just how many independent software vendors (ISVs) are there in the world? Although IDC has developed techniques that enable us to account for the total worldwide software revenue, this is the first time that we have also established the total number of worldwide ISVs. IDC has therefore developed a model — presented here — that enables us to calculate the total number of worldwide independent software vendors, segment these vendors by revenue size class, and identify their collective revenue contribution.

"Although a relatively small number of ISVs account for the majority of the worldwide software revenue, the large number of ISVs with annual revenue less than or equal to $10 million are really the unsung heroes of the software industry," says Stephen D. Hendrick, group vice president of Application Development and Deployment Research at IDC.