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SaaS Expenditures To Reach $15 Billion This Year

Organizations are putting more of their IT budgets into software as a service (SaaS). According to a report from market research firm Gartner, spending on SaaS will reach nearly $15 billion this year and will grow to more than $22 billion in 2015. These numbers include new licenses, subscriptions, upgrades, and support services across all sectors worldwide.

"After more than a decade of use, adoption of SaaS continues to grow and evolve regionally within the enterprise application markets," said Sharon Mertz, research director at Gartner in a prepared statement. "Increasing familiarity with the SaaS model, continued oversight on IT budgets, the growth of platform as a service (PaaS) developer communities, and interest in cloud computing are now driving adoption forward."

SaaS is more widely used in North America, especially the United States, than anywhere else in the world.

North American organizations are forecast to spend $9.1 billion on SaaS in 2012, or almost two-thirds of worldwide SaaS spending. The most popular applications include expense management, financials, e-mail, and office suites. However, North American organizations use Web conferencing solutions more than other regions because the workforce is more highly distributed.

According to Gartner, "Users have found that using SaaS reduces the burden of application management, increases the ease and agility of deployment, and reduces initial costs of implementation."

Mertz said that the two biggest issues North American organizations encounter when deploying SaaS are limited flexibility of customization and limited integration to existing systems.

The complete SaaS forecast report is available on the Gartner site. Gartner will release its global IT spending forecast April 5.

About the Author

Leila Meyer is a technology writer based in British Columbia. She can be reached at [email protected].

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