Gartner says worldwide SaaS revenue Is forecast to grow 21 percent in 2011

The SaaS-based delivery will experience healthy growth through 2015, when worldwide revenue is projected to reach $21.3 billion

Service revenue is forecast to reach $12

Worldwide software as a service revenue is forecast to reach $12.1 billion in 2011, a 20.7 percent increase from 2010 revenue of $10 billion, according to Gartner, Inc.

The SaaS-based delivery will experience healthy growth through 2015, when worldwide revenue is projected to reach $21.3 billion.
 Gartner defines SaaS as software in other words owned, delivered and managed remotely by one or more providers. The provider delivers an application based on a single set of common code and data definitions, which is consumed in a one-to-many model by all contracted clients anytime on a pay-for-use basis, or as a subscription based on use metrics.



Decade of use

"Afterwards more than a decade of use, adoption of SaaS continues to grow and evolve within the enterprise application markets," said Tom Eid, innovation vice president at Gartner. "This is occurring as tighter capital budgets demand leaner alternatives, popularity and familiarity with the model increases, and interest in platform as a service and cloud computing grows."


Initial concerns about security, response time and service availability have diminished for many organizations as SaaS business and computing models have matured and adoption has become more widespread, added Eid.

Gartner estimates that 75 percent of current SaaS delivery, as measured by revenue, could be regarded as cloud services, and this could exceed 90 percent by 2015 as the SaaS model matures and converges with cloud service models.



The largest market for SaaS

Customer relationship management continues to be the largest market for SaaS. SaaS revenue within the CRM market is forecast to reach $3.8 billion in 2011, up from $3.2 billion in 2010. Gartner expects SaaS to represent near 32 percent of the CRM market's total software revenue in 2011.