October 22, 2008

Gartner report states enterprise SaaS will grow by 27%

A twit from Gartner led me to this research synopsis which suggests that SaaS enterprise market will grow by 27% in '08 from '07. This confirms the earlier research report by McKinsey that I had posted about.

According to this Gartner research the two antecedents of this fast growth of SaaS are lower cost and growing demand for rapid software implementation. The report goes on to stress the importance and emergence of Platform-as-a-Service (PaaS). I concur with this conclusion, I think (large) successful SaaS players will offer PaaS sooner than later, for example, see Intuit's Quickbase.

The report does not deal with supply chain applications, but in the enterprise market the office suites solutions are expected to have 99.2 per cent compound annual growth rate (CAGR) from 2007 through 2012. I think this is great, I am happy for my friends at Zoho. They note that the content, communications and collaboration (CCC) markets remains the largest contributor to the overall SaaS enterprise application markets with revenue exceeding $2.1 billion in 2008, and it is expected to amount to $4.7 billion in 2012. Good news for folks at Wordpress and Movable Type.

Overall good times for SaaS.

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