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May 8, 2009

SaaS demand nudges near $10bn

Gartner sees increased appetite for hosted apps

By CBR Staff Writer

The value of on-demand software sold as a service could touch the $10bn mark this year, market forecasters propose, as organisations trial application delivery choices that have a smaller cost footprint than traditional on-premise options.

According to Gartner Inc, the market is forecast to reach $9.6bn in 2009, an 22% increase on 2008 numbers.

Office suites and digital content creation are the fastest-growing areas, it is estimated. Office suites are projected to total $512m in 2009, while digital content creation services will rise to $126m.

Certain factors could impede adoption Gartner has cautioned, including issues over data security, increasing concerns about scalability, questions about vendor longevity, and the fact that existing investments in applications capital and organisational expertise constrain demand in some quarters.

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