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How much share of the ERP do SaaS companies have? Are SMB companies trending towards SaaS solutions?
It seems that cloud/SaaS ERP solutions are becoming more prevalent. What are some of the reasons more companies should be thinking about a SaaS solution? What are the difficulties of a company leaving an on-premise solution for a SaaS solution?
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3 Answers
Gartner esitmates that SaaS accounts for 2% of he ERP market so still tiny, but growing fast. Anyone who wants a connected, connectable, scalable and flexible solution should be taking a look at cloud but, as always, migration is super hard so SaaS growth will come primarily from a new install base rather than migrating customers off on-premise solutions....
Last month (June, 2011) Gartner published a report that said SaaS-based ERP vendors generated 7% of total software and services sales in the global ERP market during 2010. This amounted to $1.5B in revenue. Forrester says that SaaS-based ERP spending is 2% of the total ERP market for 2010. This figure comes from their report, The State Of ERP In 2011: Customers Have More Options In Spite Of Market Consolidation (May, 2011).
Gartner sees a slow and steady growth of SaaS-based ERP, with highly specialized applications including those from Plex Systems leading the path to greater growth. Forrester sees the validation of the SaaS ERP market by SAP being a strong catalyst of growth, leading them to predict the market will grow at a CAGR of 21% through 2015.
As is the case with most forecasts, it’s best to take them as time series and normalize them to get a sense of market direction. No single forecast is going to be perfect.
I wrote a blog post about this last month titled Roundup of Cloud Computing and Software-as-a-Service (SaaS) Forecasts, June 2011. There is a table in the blog entry breaking down SaaS revenue forecasts by enterprise application area from a recent Gartner report. Here is a link to my blog post:
http://softwarestrategiesblog.com/2011/06/18/roundup-of-cloud-computing-and-s...
This ease of procurement and deployment means technically unsophisticated users are using the cloud as a backdoor for deploying apps without consulting IT.But some industry experts keep on arguing about the boomerang effect of uncontrolled SaaS applications deployment. One of the most heard is the issue of lack of data integration and co-existence between legacy apps and new SaaS apps. Full post on the subject "Are Cloud-based Business Apps a Wonder Drug with Nasty Side Effects ?" at http://www.getapp.com/blog/is-cloud-computing-saas-a-wonder-drug-with-nasty-s...
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