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August 27, 2010

Over 4.2M U.S. SMBs Plan to Adopt SaaS: Report


Market intelligence agency AMI Partners has unveiled its latest worldwide SMB Cloud Services Practice report. According to the report approximately 12 percent of small businesses and 24 percent of medium-size businesses are already using software-as-a-service or “SaaS (News - Alert).”




According to AMI Partners, today 78 percent of SBs and 31 percent of MBs are leveraging the hybrid model, which is a combination of SaaS and on-premise services, while approximately only a third of SaaS users are using an actual pure-SaaS product.

More than half of U.S. SMBs are looking into SaaS as a potential solution. According to researchers at AMI Partners, approximately one in five U.S. SMBs plan to use SaaS in the near future. As the global SMB cloud-related spending is anticipated to grow up to $95 billion by 2014, this growth is not surprising, says AMI Partners.

However, AMI believes that SMBs are easing into the concept of local plus cloud-based computing rather than leapfrogging into a pure-play platform.

“Though cloud computing is seen as the next IT platform, the consideration of SaaS amongst SMBs as the next favorable cost-saving model is expedited by the macro situation we are in today,” Yedda Chew AMI senior associate, said.

While SMBs in the U.S. are still concerned about the current market conditions and the security of a 3rd party hosting confidential numbers, the services offered by leading companies like Microsoft (News - Alert) and IBM clear their concerns.

The convergence of on-premise and SaaS offered by these companies are clearing the concerns for interested SMBs who are trying to maximize the combination of cloud and on-premise issues, Chew added.

Important applications that will accelerate the need for on demand/cloud among SMBs from SaaS plus on-premise vendors include Email/messaging, online storage and backup, and document management and collaboration solutions.

AMI Partners found that approximately 134k of non-SaaS U.S. SMB users plan to adopt the email/messaging application, allowing companies like Microsoft, who not only provide hosted solutions like exchange online in its BPOS bundle, but also its ubiquitous ‘exchange on premise’, to live in co-existence.

Approximately, 129k non-SaaS US SMB users plan to adopt online storage and backup, pushing companies like Seagate (News - Alert)/i365 a local- and cloud-based disaster recovery backup for SMBs.

Document management and collaboration solutions are the target of over 125k U.S. SMBs. They are looking for companies like Microsoft with its product Sharepoint, or Yousendit as a solution.

With budget season around, SMBs are forced to revaluate a scalable strategy using IT. This said, companies such as Microsoft, SAP AG, and IBM (News - Alert), have a leg up with mixed local and cloud-integrated solutions, according to AMI Partners.

“These companies are enjoying the SaaS tailwind, and it will be these companies with their hybrid model, which have a better chance of breaking down the barriers of the potential 5.7M non-SaaS US SMB users,” Chew added.

In May, WinterGreen Research, in its new study “Cloud Stack Layers - IaaS, PaaS, SaaS: Market Shares and Forecasts, Worldwide, 2010-2016” finds IBM is the market leader in SOA Platform as a Service or “PaaS” with 73 percent market share.

The report also found that Oracle / BEA (News - Alert) /Sun participate in the market with 6 percent share, Microsoft with 5 percent share in 2009. Salesforce.com leads in virtualized software systems with 50 percent share in the CRM SaaS software as a service market.


Rajani Baburajan is a contributing editor for TMCnet. To read more of Rajani's articles, please visit her columnist page.

Edited by Marisa Torrieri





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