Canadians increasingly have their heads in the clouds, with software as a service (SaaS) revenue growing by 27 per cent in 2011 and the market expected to be worth $1.39 billion by 2016.
Those are among the findings from market analysis firm IDC Canada as part of its recently released forecast for the Canadian cloud software market.
According to IDC, SaaS revenues in Canada reached $482 million in 2011, an increase of 24 per cent over the previous year. Revenue is forecast to reach $1.39 billion by 2016, with a compound annual growth rate of 30 per cent.
The leading vendors in the Canadian SaaS market identified by IDC included Salesforce.com, Microsoft, Cisco, Adobe and IBM. While Salesforce.com was in top spot with over $50 million in cloud revenue for 2011, there wasn’t much space between them and the other vendors.
While cloud applications were just five per cent of the software market in 2010, IDC expects that figure to reach 15 per cent by 2016. That growth is fastest in the collaboration software market, where cloud is at 75 per cent, and in the CRM market, where it’s over 50 per cent.
“As Canadian organizations gain more experience with cloud software, the perceived benefits have shifted away from ‘operational cost advantages’ as the key driver for cloud adoption towards ‘speed of deployment’. This is illustrative of how cloud computing enables businesses to move ever faster in today’s hectic world,” said Nigel Wallis, research director with IDC Canada, in a statement. “Meanwhile, top of mind inhibitors are security followed by integration, performance and availability. Line of business executives, however, are still very concerned about ‘data residency’ and ‘data repatriation’.”