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SaaS solutions growing five times faster than overall software market

  • June 28th 2014
  • by Netplan

Currently, the business software landscape is uneven and uncertain. It’s a mixture of traditional license based physical software distribution and subscription models. According to some recent studies, subscription or SaaS services are where most companies will eventually settle.

In fact, IDC predictions from a 2011 study are:

“By 2016, the cloud software model will account for £.61 of every £3 spent on software.”

A more recently published study from PwC shows that use of cloud services, SaaS in particular, is mainstream. Eighty two percent of European and seventy eight percent of North American companies utilise SaaS as part of their enterprise software.From that same study there’s an even more important fact. A full fifty percent of respondents use one or two SaaS solutions. A smaller but significant number, thirty two percent, use more than four SaaS solutions. The IDC study supports that data as well, indicating software vendors are seeing a decline in license product usage.

“Best in class” companies report using more SaaS solutions as compared to “lagging” companies that primarily use in-house solutions. This situation leaves room for explosive growth in the SaaS business as more and more companies shift from managing their own IT infrastructure and software to using cloud provided services. The shift is necessary to compete in the marketplace.

Another IDC study from 2012, “Worldwide SaaS and Cloud Software 2012–2016 Forecast and 2011 Vendor Shares” indicates that fifty percent of North American companies look to SaaS when their software licenses are due for renewal. The PwC’s study also reported that major SaaS companies say customers are looking for services, not licenses.

Software vendors are navigating this new landscape and determining how best to offer their software on a subscription basis. Finding a cloud service provider that meets all the requirements necessary is an important first step.

At Netplan we’ve helped major software companies and resellers make the migration to a SaaS platform. Contact us today to arrange a free trial of our vCloud Director platform and see how we can help you offer your software as a service and capture a slice of the ever growing market.

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