23 Dec 2008

'Recession boost' for SaaS

The recession could boost SaaS adoption among IT firms, it has been suggested.

According to Richard Adhikari of InternetNews, the challenging economic climate might prove lucrative for the entire SaaS market as enterprises look to cut down on costs associated with installing and maintaining on-premises software.

At present, larger IT vendors are the main driving force behind the SaaS market, he suggested, noting that one supplier this year achieved revenue of more than $1 billion (£675 million).

Mr Adhikari added that virtualisation is likely to emerge as a key technology within cloud computing.

"[The] virtualisation market saw the blossoming of an increasingly complex web of interrelated products, partnerships and support relationships," he said.

IT cloud offerings such as SaaS will slow in growth during 2009 but at a smaller rate than traditional alternatives, the International Data Corporation has predicted.

Research by industry analysts Gartner earlier this month found that 90 per cent of enterprises were planning to maintain or increase their use of SaaS.