Businesses are increasingly turning to software as a service (SaaS) solutions as they update and expand their cloud based services.
A Gartner report explained that 77 percent of the companies surveyed planned to increase their spending on SaaS. An additional 17 percent aimed to maintain current spending levels.
The drive toward SaaS is occurring as businesses use cloud based solutions to replace on-site applications. Attitudes toward the security, reliability and costs of SaaS and cloud applications are also changing, leading to more rapid adoption, posited Gartner in light of spending trends.
"Seeing such high intent to increase spending isn't a huge surprise as the adoption of the on-demand deployment model has grown for more than a decade, but its popularity has increased significantly within the past five years," stated Charles Eschinger, a Gartner vice president of research.
SaaS growing as part of cloud
SaaS growth has occurred in the context of increased spending on cloud computing overall. A separate Gartner study analyzed in InfoWorld noted that SaaS has accounted for roughly 15 percent of cloud adoption for 2013. The cloud computing market as whole is expected to grow 18.5 percent this year, reaching $131 billion in value.
The flexibility of SaaS may also be a driver of its growth. Some applications are provided exclusively in SaaS models, meaning that they may be easier to update and optimize for specific customers, argued a Salesforce.com vice president quoted by The Australian.
Hybrid clouds, which combine cloud services with on-site storage, are also growing and buoying SaaS adoption. A study from 452 Research stated that 68 percent of companies plan to adopt a hybrid cloud in the next two years. Hosted public and private clouds were estimated to grow 11 percent over the same period, while on-site clouds were thought to grow 9 percent.
Two-thirds of the businesses surveyed already use SaaS solutions such as analytics programs or customer relationship management tools. Commenting on the study, Business Cloud argued that hybrid clouds with SaaS components are easy to set up and manage. They may also be appealing to organizations concerned with data security and compliance.
Challenges may eventually arise once IT departments have to manage more workflows across hybrid clouds. A Gartner research director quoted by Business Cloud also identified hybrid cloud computing as a currently immature market.