SaaS Market To Show Significant Growth

Per Gartner, worldwide Software as a Service (SaaS) revenue is forecast to reach $12.1 billion in 2011, a 20.7 percent increase from 2010 revenue of $10 billion. SaaS-based services will continue to grow through 2015 to reach $21.3 billion.

For companies considering cloud as an IT option, SaaS may be a good way to start. In SaaS, you get the application already developed. The upside of this is that your application is up and running quickly, there is less development risk and there is no need to pay for development, operation or maintenance of the application. It is easy to add users and there is a greater ability to scale software to meet changing business requirements. The SaaS model enables you to benefit from the latest technology without the disruptions and costs associated with software upgrades.

The downside of using SaaS is that SaaS applications are often difficult to customize since you do not have the code for the application. Also, normally the pricing model is per user, so it may be an expensive option if you have a lot of users. Also, a SaaS application may have a different security and management model than you have for your internal applications. So you would need to adjust your model to include these applications.

"Initial concerns about security, response time and service availability have diminished for many organizations as SaaS business and computing models have matured and adoption has become more widespread," said Tom Eid, Research VP of Gartner. "Usage and vendors' on-demand ecosystems continue to evolve to provide additional business and technology services, more vertical-specific functionality, and stronger communities of partners and buyers."

If you want to know more about how SaaS vendors can meet you needs and to see a list of potential vendors, click here. This Showplace is administered by THINKstrategies, an independent strategic consulting company. Here you can search for potential vendors by industry and application.

Rose Klimovich is a consultant and writer on technology. Formerly she was VP Product Management and Product Marketing for the colocation and interconnection products for Telx, where she led the efforts in creating the Telx strategy and developing and investing in new products and services in areas like colocation, cloud, Ethernet Exchange and Telepresence video.