SaaS: Gartner predicts SaaS will grow to $19.3 billion by 2011

first_imgGartner is predicting that the worldwide SaaS market will grow from $6.3 billion in 2006 to reach $19.3 billion by the end of 2011.  In 2006 the growth rate was 26 percent and the prediction is for growth to continue at 25 percent a year through the end of 2011.  But Gartner sees big-name vendors like Oracle, SAP and Microsoft as missing out on the trend.Ben Pring who wrote the Gartner report sees customers as rejecting a software + services model based on traditional software that ends up costing customers bug bucks and often includes functionality that may not be used or needed by the customer. Large software vendors are not inclined to introduce SaaS products that may compete with their standard software offerings.  SAP, Oracle and Microsoft have all attempted on-demand CRM, but Pring says that their attempts have been half-hearted and haven’t gotten much traction.  Because of that smaller vendors are stepping up to the opportunity.To address the SaaS market, Gartner gives the following advice to those smaller vendors:Use an SOA framework, Web Services, multitenant servers, and automated server farmsBegin now.  The opportunities are there and building out the solution will take time.Keep abreast of the market and continually reposition based on how the market evolveslast_img

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