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At TSIA, we’re a group of data fanatics on a mission to give your technology company the fact-based insight you need to achieve profitable growth. We do this by collecting, analyzing, and triple-validating performance data from across the technology and services industry and boiling it down into proven action plans you can use to get and stay ahead in an evolving marketplace.

TSIA members have access to the vast repository of reports based on the data we collect through benchmarks and member surveys, but we also track and provide public information that gives us a snapshot of the current state of the tech industry, which we divide into three major indices: The Technology & Services 50, Cloud 40, and Industrial Equipment 40. Here’s a bit about each one and how they can help you better understand where your company fits with your industry peers.

Technology & Services 50

The first is our Technology & Services 50 Index, which consists of 50 of the largest, publicly traded, global providers of technology solutions on the planet, including companies like IBM, Microsoft, and Cisco. Since 2005, TSIA has been aggregating their financial performance data, which is then presented quarterly to identify emerging service revenue and profitability trends, while also providing critical observations based on the current state of the technology industry.
While the Technology & Services 50 Index tracks 50 of the largest global providers of technology services and solutions—including hardware, software, and pure service companies—it’s not intended to be a representation of the 50 largest companies by revenue. This index is designed to provide the most accurate snapshot of how the technology industry is performing overall, diving into:

  • Key trends in the technology and services industry
  • Overall revenue and profit trends for technology companies
  • Service revenue growth and margin trends
  • How business models for hardware and software companies are shifting
  • The growing influence of cloud computing on the financial results of the Technology & Services 50 companies
  • The product/service mix
technology and services industry performance data  

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48% of the companies in the Technology & Services 50 Index experienced flat or declining product revenues in Q1 of 2019, while 66% experienced growth in services revenues. Learn more in the public on-demand webinar, “Technology & Services 50 Q1 2019”.

Cloud 40

TSIA’s Cloud 40 Index consists of 40 of the largest “born-in-the-Cloud” companies in existence, including fast-growing companies like Salesforce, NetSuite, and Rackspace. We review the performance of these companies and provide analysis in the areas of revenue growth, profitability, and financial business model.
Cloud computing has become an inevitable reality for most technology companies, but how fast are as-a-service revenues growing? And what does this new consumption model mean for the business models of traditional tech? The annual readout of the Cloud 40 Index aims to find answers to these questions and more. In addition, TSIA’s Cloud 40 Index allows us to:

  • Observe the growth rate and market caps of born-in-the-cloud companies
  • Contrast the traditional tech business models against as-a-service business models
  • Compare services strategies of cloud companies vs. traditional product providers
  • Identify and discuss key trends in cloud computing

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In comparing trends learned from hardware, software, and pure service companies tracked in the Technology & Services 50 Index, “born-in-the-Cloud” companies in the Cloud 40 Index earn the majority of their revenue from subscriptions as opposed to services.
Source: “TSIA Cloud 40, Q4 2018” (available only to TSIA members on an annual basis.)

Industrial Equipment 40

And finally, TSIA’s Industrial Equipment 40 Index tracks, aggregates, and analyzes the financial outcomes of 40 industrial manufacturers quarter to quarter, reported annually. This index is designed with an emphasis on tracking trends in the performance of their services lines of business.

Currently, the Industrial Equipment 40 Index is exhibiting a number of warning signs that signal an impending business model shift in the industrial equipment industry:

  • The long-term trend shows that growing revenues does not lead to an increase in the profitability of services
  • Industrial equipment is not immune to the commoditization of features and functionalities
  • New services decoupled from the initial product need to create additional revenue streams and higher margins
To meet these changes head on, TSIA recommends developing your services along TSIA’s Remote Services Continuum and to embrace the Digital Value Chain, which you can learn more about in the ebook, “Why Services is the Big IoT Opportunity for Hardware Manufacturers,” co-authored by TSIA’s Vele Galovski, VP of Field Services Research, and Harald Kopp, Director of Industrial Services Research.
remote services continuum  

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TSIA’s Remove Services Continuum is a three-step approach that can be used as a roadmap for companies that want a better understanding of how to use digital technologies to provide more value for their customers, as well as how to monetize services based on those capabilities.
Source: “Why Services is the Big IoT Opportunity for Hardware Manufacturers”.

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Nicole Dornsife

About Author Nicole Dornsife

Nicole Dornsife is the former senior content manager for TSIA. She has over 10 years of experience writing for the software and SaaS industries, and joined TSIA in 2014. She managed the TSIA blog and regularly collaborated with TSIA's research team and partner companies to publish their insights on the latest news in the technology and services industry. She also provided editorial support for TSIA’s conferences.