tech:

taffy

Worldwide SaaS Adaptation And Growth Snapshot

Worldwide software as a service (SaaS) revenue is on pace to reach $12.1 billion in 2011, a 20.7 per cent increase from 2010 of $10 billion, according to Gartner. The North American region is forecast to account for 63.6 per cent of worldwide SaaS revenue this year. By the end of 2015, that number will come down to 60.8 per cent. You can read the official press release here.

Increasing familiarity with the SaaS model, continued oversight on IT budgets,  growth of platform as a service (PaaS) developer communities, and interest in cloud computing are some of the factors driving adoption, says Sharon Mertz, research director at Gartner.

Points to Ponder

Usage varies within markets, regions and countries, and the reasons for adopting SaaS vary by region. Total cost of ownership (TCO) is a primary driver in Europe, Middle East and Africa (EMEA), while ease and speed of deployment is the key reason for choosing SaaS in Asia/Pacific and North America.

Bottlenecks encountered when deploying SaaS also vary by region. Limited flexibility of customization is a key issue for EMEA. Limited integration to existing systems is the primary reason in North America and Asia/Pacific.

North America, specifically the U.S., represents the largest opportunity for SaaS, and it is the most mature of the regional markets.

SaaS revenue in North America is projected to total $7.7 billion in 2011, an 18.7 per cent increase from 2010 revenue of $6.5 billion. North American SaaS revenue is forecast to reach $12.9 billion in 2015.

In North America, ease and speed of deployment are primary reasons for SaaS adoption, followed by lower TCO. Limited capital expense is also considered more important in North America than in the other regions. Consistent with the other regions, CRM shows the highest use of SaaS among enterprise applications n North America. Use of Web conferencing, e-learning and travel booking is higher here  than in the other regions.

In Western Europe, SaaS revenue is expected to reach $2.7 billion, up 23.3 per cent from 2010 revenue of $2.2 billion. SaaS revenue is projected to reach $4.8 billion in 2015.

In Eastern Europe, SaaS revenue is expected to reach $131.4 million in 2011, a 29.8 per cent increase from 2010 revenue of $101.2 million. Eastern Europe SaaS revenue is forecast to total $270.1 million in 2015.

SaaS penetration and adoption is occurring mostly in Northern Europe, which is composed of the U.K., Ireland, the Netherlands and Nordic countries. This is due to a culturally open outlook toward technology adoption, well-established and generally good Internet infrastructure within these countries, and English being the primary business language. This also makes it much easier for North American vendors to branch out into the region and for local vendors in one country to adapt and sell their applications in other Northern European countries with less localization effort.

SaaS revenue in Asia/Pacific is forecast to total $768.3 million in 2011, a 27.7 percent increase from 2010 revenue of $601.8 million. By the end of 2015, SaaS revenue in Asia/Pacific will reach $1.7 billion. SaaS adoption is more prominent in the more mature markets in Asia/Pacific, such as Australia, New Zealand, Hong Kong, Singapore and South Korea.

In many cases, the use of English as a common language in these countries, except in South Korea, makes them an attractive destination for foreign providers investing in the region.

In Japan, SaaS revenue is projected to reach $379 million in 2011, up 20.2 per cent from 2010 revenue of $315.3 million. By the end of 2015, SaaS revenue is expected to reach $629.1 million. SaaS demand in Japan will grow for sales force automation solutions. Demand for marketing analysis solutions will also be higher. It is easy to adopt SaaS solutions for B2B call center services in Japan because the workflow is standardized and transaction volume is constant.

SaaS revenue in Latin America is expected to total $328.4 million in 2011, a 23.5 per cent increase from 2010 revenue of $266 million. While in general the SaaS market in Latin America can be considered embryonic, many Latin American CIOs see the strategic importance of SaaS and Gartner expects overall software revenue for SaaS in Latin America to rise to $694.2 million in 2015.

E-say

Sharon Mertz (research director, Gartner): Usage varies within markets, regions and countries, and the reasons for adopting SaaS vary by region. Total cost of ownership (TCO) is a primary driver in Europe, Middle East and Africa (EMEA), while ease and speed of deployment is the key reason for choosing SaaS in Asia/Pacific and North America.

Just in

Apple sued in a landmark iPhone monopoly lawsuit — CNN

The US Justice Department and more than a dozen states filed a blockbuster antitrust lawsuit against Apple on Thursday, accusing the giant company of illegally monopolizing the smartphone market, writes Brian Fung, Hannah Rabinowitz and Evan Perez.

Google is bringing satellite messaging to Android 15 — The Verge

Google’s second developer preview for Android 15 has arrived, bringing long-awaited support for satellite connectivity alongside several improvements to contactless payments, multi-language recognition, volume consistency, and interaction with PDFs via apps, writes Jess Weatherbed. 

Reddit CEO Steve Huffman is paid more than the heads of Meta, Pinterest, and Snap — combined — QZ

Reddit co-founder and CEO Steve Huffman has been blasted by Redditors and in media reports over his recently-revealed, super-sized pay package of $193 million in 2023, writes Laura Bratton. 

British AI pioneer Mustafa Suleyman joins Microsoft — BBC

Microsoft has announced British Artificial Intelligence pioneer Mustafa Suleyman will lead its newly-formed division, Microsoft AI, according to the BBC report. 

UnitedHealth Group has paid more than $2 billion to providers following cyberattack — CNBC

UnitedHealth Group said Monday that it’s paid out more than $2 billion to help health-care providers who have been affected by the cyberattack on subsidiary Change Healthcare, writes Ashley Capoot.