The increasing business outsourcing of software services, along with the growing demand for new IT solutions, has propelled the growth of the global Software as a Service (SaaS) market. The market is anticipated to expand at a CAGR of 27.9% during the period between 2015 and 2022. The rising mobile access to SaaS has supported the market’s growth. However, concerns regarding data security and lack of integration are the key challenges inhibiting the growth of the market.
High speed internet connectivity is a prior requirement for the efficient operation of SaaS solutions. The absence of robust internet infrastructure across the developing economies is expected to hamper the growth of the market. The global SaaS market has a significant opportunity to grow with the development of Containers as a Service (CaaS) solutions. The growing number of specialized SaaS applications, increasing investments in personal consumer research, and the development of new alternatives to multi-tenancy are the current trends in the market.
HCM to be Leading Application Segment in Global SaaS Market
On the basis of type of clod development, the global SaaS market has been categorized into private cloud, public cloud, and hybrid cloud. In 2014, the public cloud model dominated the overall market. The hybrid and private clouds SaaS market is fuelled by the increasing demand from the larger organizations that are more concerned with the security and confidentiality of data. Small and medium businesses have low capital and CAPEX requirements for the deployment of SaaS solutions. As a result, these organizations prefer public cloud deployment.
In terms of application, the global SaaS market has been divided into operations and manufacturing, enterprise resource planning (ERP), customer relationship management (CRM), human capital management (HCM), content management system, supply chain management, structured data management, collaborative solutions, structured data management, integration and process automation middleware, engineering, security, system or network management, and quality and lifestyle tools. The application of SaaS solutions in customer relationship management has been extensive and hence, this application segment led the overall market in 2014. In the coming years, while this segment is anticipated to dominate the market, the human capital management segment is projected to be report the fastest growth in the market.
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Asia Pacific Holds Immense Potential for Growth of Global SaaS Market
The global SaaS market has been segmented into five key regions: Latin America, North America, the Middle East and Africa, Europe, and Asia Pacific. In 2014, North America dominated the market and held 55% of the overall revenue. During the period between 2015 and 2022, the region is anticipated to lead the market owing to the presence of a large number of established communication networks and increasing usage of smartphones. However, Asia Pacific is projected to be at the forefront of adopting SaaS solutions in the coming years.
Key Players in Global SaaS Market
Some of the key players in the global SaaS market are Amazon Web Services Inc., Salesforce.com Inc., SAP SE, Microsoft Corporation, Google Inc., Blackboard Inc., IBM Corporation, Oracle Corporation, Workday Inc., Symantec Corporation, ADP LLC, and Fujitsu Ltd. The key players are focussing on Asia Pacific owing to the increased broadband connectivity and the rise in the number of smartphone users in the region.