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Cloud Computing: SaaS Revenue Growth remains Strong
SaaS continues to grow rapidly. It’s really no wonder, given the poor state of the economy. Tough times are forcing many companies to scour their operations to find any possible cost savings. A recent Gartner report by analysts Sharon Mertz and Chad Eschinger estimates that the 2011 global SaaS market is on track to grow 20.7 percent this year, topping $12.1 billion .
North America, and the US in particular, continue to be front-running adopters of SaaS technologies. In 2011, North America now makes up 63.6 percent of the global market. And the report expects that North America will continue to hold a dominant lead in SaaS through 2015, by which time North American market share is expected to still remain high, holding 60.6 percent of the total market. The North American market now stands at $6.5 billion, an 18.7 annual increase over last year, and is expected to reach $12.9 billion by 2015.
Garnter’s Mertz explained that the main reason for SaaS growth in North America is ease and speed of deployment , followed by lower TCO. “Limited capital
expense is also considered more important in North America than in the other regions. Consistent with the other regions, CRM shows the highest use of SaaS among enterprise applications while use of Web conferencing, e-learning and travel booking is higher in North America than in the other regions.”
“In North America, ease and speed of deployment are primary reasons for SaaS adoption, followed by lower TCO,” Ms. Mertz said. “Limited capital expense is also considered more important in North America than in the other regions. Consistent with the other regions, CRM shows the highest use of SaaS among enterprise applications while use of Web conferencing, e-learning and travel booking is higher in North America than in the other regions.”
Elsewhere in the world, 2011 market revenues are estimated as follows:
- Western Europe – $2.7 billion (23.3 percent annual growth), expecting to grow to $4.8 billion by 2015
- Eastern Europe – $131.4 million (29.8 percent growth), expecting to grow to $270.1 million by 2015
- Asia/Pacific – $768.3 million (27.7 percent growth), expecting to grow to $1.7 billion by 2015
- Japan – $379 million (20.2 percent growth), expecting to grow to $629.1 million by 2015
