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Monday, June 30, 2008

Demand for SaaS is Spread Across Verticals

Demand for software as a service (SaaS) business applications in the U.S. commercial sector is growing at a steady pace across all sizes of business and vertical markets, according to the latest market study by In-Stat.

Based upon their current assessment, steadily increasing U.S. hosted application revenues -- from $8 billion in 2008 to $16 billion by 2012 -- are expected, the high-tech market research firm says.

"The main benefits of hosted applications that resonate across vertical markets are scalability, Total Cost of Ownership (TCO), and remote accessibility," says Jeff Jernigan, In-Stat analyst.

"Also, the need for IT support for business applications is greatly minimized if not eliminated due to the centralized, vendor-supported management of the application."

Their research covers the U.S. market for SaaS. It explores the drivers and inhibitors for adoption, as well as whom respondents would turn to for more information about these applications. Survey data from four vertical markets is presented and compared to results from respondents across the entire market.

In-Stat's market study found the following:

- The healthcare market is among the most satisfied current hosted application user segments.

- The education market should be an important target market for providers, as it is a market full of thought-influencers.

- Despite strong current adoption, hosted Web collaboration application providers need to do more to reach new customers.