Microsoft leads the overall enterprise software-as-a-service (SaaS) market in the world with the highest revenues, said a new Q2 data from Synergy Research Group. Global technology giant which has already overtaken long time market leader Saleforce in SaaS, got a huge boost with the acquisition of LinkedIn which gave its SaaS business a further push, said report. According to US-based research firm which specialises in providing market intelligence and analytics for the networking and telecoms industry, the enterprise SaaS market grew 31% year on year to reach almost $15 billion in quarterly revenues, with collaboration being the highest growth segment.
Microsoft remains the clear leader in overall enterprise SaaS revenues. In terms of overall SaaS market rankings, Microsoft is the No. 1, followed by Salesforce, Adobe, Oracle and SAP. Companies such as ADP, IBM, Workday, Intuit, Cisco, Google and ServiceNow are also inching closer, said report. Cisco strong presence in collaboration space and its recent push for projecting itself more as a software driven solution provider than the existing tag of hardware networking giant seems to be working. Its recent announcements around ‘Network Intuitive’ that helps customers automate their networking management with the help of software capabilities on top of their existing hardware is likely to further spur its share in SaaS, said a analyst.
Overall, the SaaS market is highly fragmented with different vendors leading different market segments. “Among the major SaaS vendors those with the highest overall growth rates are Oracle, Microsoft and Google,” report said. The report suggests that the enterprise SaaS market seems to be matured but spending on SaaS remains relatively small compared to on-premise software, meaning that SaaS growth will remain buoyant for many years. Synergy forecasts that the SaaS market will double in size over the next three years, with strong growth across all segments and all geographic regions.
“IaaS and PaaS markets tend to get more attention and are indeed growing more rapidly, but the SaaS market is substantially bigger and will remains so for many years,” stated John Dinsdale, a chief analyst and research director at Synergy Research Group. Traditional enterprise software vendors like Microsoft, SAP, Oracle and IBM still have a huge base of on-premise software customers and they are all now pushing to aggressively convert those customers to a SaaS-based consumption model.
At the same time, born-in-the-cloud software vendors like Workday, Zendesk and ServiceNow continue to light a fire under the market and help to propel enterprise spending on SaaS, said Synergy.