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Global SaaS usage hits 70%

24 Dec 2012

Adoption of software as a service (SaaS) has grown dramatically among users of enterprise software solutions across the world.

A recent Gartner survey showed 71% of companies have been using SaaS for less than three years, showing the deployment model to be strong and continuing to expand with late adopters.

Interviewing 556 organisations across ten countries and within four regions (North and South America, Europe and Asia/Pacific), Brazil currently has the largest number of new users, with 27% of respondents using SaaS for less than a year.

Implementing net new solutions or replacing existing solutions is now the primary driver for using SaaS, according to the reports.

Worldwide, there is a shift in SaaS adoption from primarily extensions to existing applications to net new deployments or replacements of existing on-premises applications.

"Although approximately half of respondents in Asia/Pacific indicated the primary adoption driver of SaaS was net new deployments, the U.S. and European respondents indicated their strongest driver was to replace existing on-premises applications," says Charles Eschinger, research vice president at Gartner.

"It's not surprising that SaaS is being deployed as net new deployments in Asia/Pacific since many of the users are relatively new businesses with few legacy systems.

"Markets, such as the U.S. and EMEA are mature with existing enterprise systems and are beginning to use SaaS as a replacement for legacy applications."

Gartner says investments in SaaS are expected to increase across all regions with 70% of respondents expected to increase spending on SaaS, while 17% plan to keep spending the same.

Over 80% of respondents in the Asia/Pacific indicated more spending on SaaS applications over the next two years, with the U.S. and European countries were not far behind on 73% and 71% respectively.

"Seeing such high intent to increase spending isn't a huge surprise as the adoption of the on-demand deployment model has grown for more than a decade, but its popularity has increased significantly within the past five years," Eschinger says.

"Initial concerns about security, response time and service availability have diminished for many organisations as SaaS business and computing models have matured and adoption has become more widespread.

"The decision to deploy SaaS-based applications within an enterprise is dependent on the business-criticality of the solution, as well as geography, business agility, usage scenario and IT architecture.

"Few organisations will completely migrate to SaaS.

"These organisations will live with a mix of SaaS and traditional on-premises application deployment models with a focus on integration and migration between different deployment models."

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