The Future is SaaS and SaaS is Now

In a survey conducted by Unisys and IDG Research throughout 2013, more than 50 percent of senior-level IT leaders at organizations with over 1,000 employees indicated that they have at least one application or a portion of their organization’s IT infrastructure in the cloud. “These executives also noted that about 26 percent of their enterprise information currently resides in a private cloud, and, despite their security concerns, they expect that percentage to grow to about 32 percent in the next 18 months.”The main driver behind this “push” to the cloud is the pressures IT leaders face to reduce costs while maintaining an efficient IT infrastructure.   Large organizations (over 1,000 employees) move away from the hefty capital outlay involved in installing, maintaining and upgrading on-premises IT infrastructure to the operational cost of a SaaS subscription.  As an organization grows and needs to add more users, rather than investing in additional in-house server capacity and software licenses, the business can adjust its monthly SaaS subscription as needed.

Now this is not to say a SaaS model comes without its concerns, namely security and performance.  Organizations must put their trust in a 3rd party’s infrastructure to effectively run their environment which can lead to issues of churn and poor customer satisfaction should the 3rd party be unable to continue or exceed the previous performance standard of the organization. 

This is a risk it seems IT leaders are willing to take.  According to the Gartner group SaaS revenue starting in 2010 has increased steadily from 10 Billion to 12 Billion (2011), to 14.5 Billion (2012), and projected to reach heights of up to 22 Billion by 2015.  Companies will continue to address concerns around and security and performance as the need across organizations grows, but it is clear SaaS is the future and the future is now.

Jon Martin

Softential Director of Inside Sales

jmartin@softential.com