Worldwide Software-as-a-Service Revenue to Reach $14.5 Billion in 2012

Worldwide software-as-a-service (SaaS) revenue is forecast to reach $14.5 billion in 2012, a 17.9 percent increase from 2011 revenue of $12.3 billion, according to Gartner, Inc. SaaS-based delivery will experience healthy growth through 2015, when worldwide revenue is projected to reach $22.1 billion.

Although growing interest has been observed in vertical-specific software, the most widespread use is still characterized by horizontal applications with common processes, among distributed virtual workforces and within Web 2.0 activities.

North America, specifically the U.S., currently represents the largest opportunity for SaaS, and it is the most mature of the regional markets. SaaS software revenue is forecast to total $9.1 billion in 2012, up from $7.8 billion in 2011. Consistent with other regions, North America shows the highest SaaS deployments in expense management, financials, email and office suites. Use of Web conferencing is higher in North America than in other regions, in part because of a highly distributed workforce.

In Western Europe, SaaS revenue is forecast to surpass $3.2 billion in 2012, up from $2.7 billion in 2011, while SaaS revenue is Eastern Europe is projected to reach $169.4 million, up from $135.5 million last year. Gartner analysts said SaaS adoption in EMEA is currently running at two speeds.

SaaS revenue in Asia/Pacific is on pace to reach $934.1 million in 2012, up from $730.9 million in 2011. Overall, SaaS adoption in Asia/Pacific has been fragmented. Asia/Pacific (excluding Japan) is a combination of mature markets, such as Australia, New Zealand, Hong Kong, Singapore, South Korea and Taiwan, and emerging markets, including China, India, Malaysia, Thailand, Indonesia, Vietnam and the Philippines.

While the Japanese economy is still struggling and IT budgets are limited, the demand for SaaS solutions is increasing due to their lower implementation costs and faster deployment times. SaaS revenue in Japan is forecast to reach $495.2 million in 2012, up from $427 million in 2011. Gartner forecasts that growth of the SaaS market in Japan through 2015 will be led by CRM and email/groupware, which already have actual demand.

SaaS revenue in Latin America is forecast to total $419.7 million in 2012, up from $331.1 million last year. In Latin America, SaaS has become most popular to deploy in the areas of email, financial management (accounting), sales force automation and customer service, and expense management.

Gartner defines total software revenue as revenue from new licenses, subscriptions, and software maintenance and technical support services that include license sales to update/upgrade an existing license to a new version, telephone support and on-site remedial support. SaaS is primarily a software delivery and management approach that exists in established markets, such as CRM or ERP.

More information on SaaS can be found at www.CRMindustry.com

How Cloud Computing is Generating New Business Opportunities and Fueling Job Growth in the United States

Cloud computing is a powerful catalyst for job creation and has greater potential for employment growth than the Internet did in its early years, according to a new study by the Sand Hill Group, sponsored by SAP America, Inc., a subsidiary of SAP AG.

According to the study, cloud computing is already generating a sizable number of jobs in the U.S. today. Based on numerous trends and indicators, it has the future potential to create very large business opportunities and hundreds of thousands of new jobs in the U.S. The study, titled “Job Growth in the Forecast: How Cloud Computing isGenerating New Business Opportunities and Fueling Job Growth in the UnitedStates,” looked at several ways cloud computing may create jobs and found specifically:

-- Eleven cloud computing companies added 80,000 jobs in the United States in 2010, and the employment growth rate at these organizations was almost five times than that of the high-tech sector overall.

-- Companies selling cloud services are projected to grow revenues by an average of US$20 billion per year for the next five years, which has the potential to generate as many as 472,000 jobs in the U.S. and abroad in the next five years.

-- Venture capital investments in cloud opportunities are projected to be US$30 billion in the next five years, which could add another 213,000 new jobs in the U.S.

-- The economic impact for companies buying cloud services can be even more significant. Cloud computing could save U.S. businesses as much as US$625 billion over five years, much of which could be reinvested to create new business opportunities and additional jobs.

More information on Cloud Computing can be found at www.CRMindustry.com

Social CRM and Mobile Capabilities Boost Productivity by 26.4 Percent

A NucleusResearch survey of CRM decision makers found that organizations can significantly increase returns on their CRM investments by adding mobile and social capabilities, particularly for salespeople. Nucleus surveyed 223 CRM decision makers and found an average productivity gain of 14.6 percent from mobile capabilities and 11.8 percent from social CRM.

Mobile CRM

While salespeople have used mobile devices for some time, the 14.6 percent productivity increase seen in this report is driven by the development of custom, device-specific applications that take advantage of the form factors of individual devices. Vendors and consultants are increasingly delivering task-specific, role- and vertical-based views of mobile CRM data that make it easier for salespeople to go beyond updating their pipeline via their smart phone.

Social CRM

Nucleus has found that early adopters of social CRM have recognized clear benefits, such as increased visibility and productivity. The 11.8 percent productivity gain is high, and Nucleus expects adoption of social CRM, particularly by salespeople, to grow not just in real numbers, but also in frequency of activity as users become more aware of the technology’s capabilities and as vendors’ offerings mature.

More information on CRM can be found at www.CRMindustry.com

Cloud Computing to Rewrite Corporate Business Models

The number of enterprises turning to cloud computing to revamp existing business models will more than double in the next three years, as business leaders move to capitalize on the rapid availability of data and the growing popularity of social media, according to a new study released by IBM. Businesses that embrace the transformative power of cloud will have a significant advantage in the race to introduce new products and services and capture new markets and revenue streams.

According to the study, as they strive to better meet customers' needs and drive future growth, business leaders will increasingly tap cloud to develop new business models that can exploit the capabilities resulting from these digital trends. While 16 percent of the executives surveyed indicate they are already using cloud capabilities for sweeping innovation, such as entering new lines of business or reshaping an existing industry, by 2015 35 percent intend to use it to transform their business models.

While a little more than half of the respondents indicated "improving organizational efficiency" as a top business challenge today, only 31 percent anticipate it will be a top challenge in three years. Instead the study indicates that their focus is shifting to growth and competitive initiatives in the future. The objectives cited by survey respondents for adopting cloud are in line with these business goals, indicating that business needs will soon rival IT motivations for cloud adoption:

-- 62 percent of survey respondents said increased collaboration with external partners is a key objective for adopting cloud;

-- 57 percent cited competitive cost advantages through vertical integration as a major motivation; and

-- 56 percent pointed to opening new delivery channels and markets as an important objective.

More information on cloud computing can be found at www.CRMindustry.com

IT Departments Scramble to Keep Pace with Mobility Growth

As mobile devices and applications extend the boundaries of the workplace, information technology (IT) departments must create new policies and procedures to keep the mobile enterprise accessible, available and secure, according to research released today by IT industry association CompTIA.  

While PCs continue to be a major part of the corporate IT landscape, CompTIA's Trendsin Enterprise Mobility study reveals that laptops, ultrabooks, smartphones and tablets are increasingly essential to day-to-day business in a "post-PC" environment. Smartphones are in place at more organizations than standard cell phones, and tablets are the top choice for purchase intent in the next year.

The CompTIA study also finds that 84 percent of those surveyed use their smartphone for light work such as email or web browsing. Individuals using tablets have an even wider range of uses, including note-taking, giving presentations and using their tablet as a communications device in lieu of a phone.  As a result, IT departments are building new policies governing behavior in a mobile environment; and implementing support structures and applications.

Only 22 percent of companies in the CompTIA survey currently have a formal mobility policy. Another 20 percent were building policies at the time of the survey. These policies typically cover guidelines for mobile applications and corporate data, along with device guidelines.

Security considerations are the greatest risk involved in supporting mobility, at least in the view of 70 percent of IT staff surveyed for the CompTIA study. Among the challenges they face:

-- Downloading unauthorized apps, cited as a serious concern by 48 percent of respondents

-- Lost or stolen devices (42 percent)

-- Mobile-specific viruses and malware (41 percent)

-- Open Wi-Fi networks (41 percent)

-- USB flash drives (40 percent)

-- Personal use of business devices (40 percent)

These types of incidents and others have prompted organizations to take various security measures. Requiring passcodes, installing tracking software and encrypting data on the device are among the most common steps taken.

More information on IT and CRM can be found at www.CRMindustry.com