Business analytics SaaS market to boom to 2013

12 Jan 2010

Business analytics software-as-a-service (SaaS) is set to grow three times faster than the overall business analytics market, according to IDC.

Over the next five years, the business analytics software-as-a service (SaaS) market will grow more than three times as fast as the total business analytics software market with a compound annual growth rate (CAGR) of 22.4pc through 2013.

A new study from IDC finds that the number of business analytics SaaS users will grow rapidly from a small base, however market revenue will remain low relative to on-premise software throughout the forecast period.

“The business analytics SaaS market is poised for rapid growth as more organisations turn to cloud-based computing and alternative deployment options,” said Brian McDonough, research manager for IDC’s Business Analytics Solutions research service.

“Growth expectations must be tempered as revenue generation gains traction behind user adoption,” McDonough added.

Software demand

As more and more business analytics software providers move to address increasing market demand for software that is updated frequently, hosted offsite, and can be purchased on a subscription basis, several factors will help in driving this growth.

Capital expenditure policies and budget constraints make SaaS offerings more attractive as they enable departments to subscribe to software services using operational budgets.

IT resources are strained and there is insufficient time to build, buy, or evaluate specific solutions for various business problems, putting control of technology decisions into the hands of the business user.

Additional software functionality built on new platforms is suitable for SaaS delivery since there are well-established best practices that can be configured, rather than customised, through a flexible platform to suit most business needs.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years