Global SaaS revenue to touch $22.1 bn by 2015: Gartner

Worldwide software-as-a-service (SaaS) revenue is expected to reach $22.1 billion by 2015 as more companies invest in cloud technology, research firm Gartner today said.

SaaS, often referred to as on-demand software, is a delivery model in which software and its associated data are hosted centrally and are accessed by users using a web browser.

Global SaaS revenue is expected to grow 17.9% to reach $14.5 billion in 2012 from $12.3 billion in 2011 as SaaS-based delivery experiences healthy growth, it said in a statement.

"After more than a decade of use, adoption of SaaS continues to grow and evolve regionally within the enterprise application markets," Gartner Research Director Sharon Mertz said.

"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," Mertz said.

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

SaaS software revenue in the region is forecast to total $9.1 billion in 2012, up from $7.8 billion in 2011.

In Western Europe, SaaS revenue is forecast to surpass $3.2 billion in 2012, up from $2.7 billion in 2011.

SaaS revenue is Eastern Europe is projected to reach $169.4 million, up from $135.5 million last year.

Revenue in Asia/Pacific is on pace to reach $934.1 million in 2012, up from $730.9 million in 2011.

SaaS financial (accounting) applications are most popular, particularly in China and India, Gartner said.

Revenues from Japan is forecast to reach $495.2 million in 2012, up from $427 million in 2011.

Gartner forecasts that growth of the SaaS market in Japan through 2015 will be led by CRM and email/groupware, which already have actual demand.

"In addition, since the 2011 earthquake and tsunami, users have looked to SaaS adoption as a defense against future power outages and disasters. However, many companies are still concerned about SaaS-related issues, such as data security risk, true cost-effectiveness and the difficulty of linking with other systems," it said.

SaaS revenue in Latin America is forecast to total $419.7 million in 2012, up from $331.1 million last year.