SaaS market up 32% to over $20bn

SaaS market up 32% to over $20bn

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The enterprise software as a service market is now generating more than $20 billion in quarterly revenues, up by 32% per year, according to a report.

Figures from Synergy Research Group (SRG) showed that Microsoft is the dominant player in the enterprise SaaS space with a market share topping 17% worldwide. Sales from the US-based software giant grew 45% in this space in the last year.

Salesforce, which Microsoft surpassed just over two years ago, is still leading in the CRM space but has relatively low growth compared to other SaaS sectors at just 25%.

The two leaders are followed by Adobe, Oracle and SAP, with Oracle achieving the highest growth rate among these three. The top five vendors hold over half of the market share, more than double the combined share of the next 10 vendors, which includes the likes of Google, ServiceNow and ADP.

“There is a fascinating battle for SaaS playing out, with traditional enterprise software vendors slugging it out with born-in-the-cloud vendors like Workday, Zendesk, ServiceNow and Dropbox,” said John Dinsdale, a Chief Analyst at Synergy Research Group.

“The latter group are helping to rapidly transform the market, but the more traditional players like Microsoft, SAP, Oracle and IBM still have a huge base of on-premise software customers that they can convert to a SaaS-based consumption model. Meanwhile Cisco and Google too are making ever-bigger inroads into the SaaS market, via Cisco’s collaboration apps and software vendor acquisitions and Google’s G Suite.”

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