In a new study, market research firm IDC projects that over the next five years, the business analytics software-as-a-service market will grow more than three times as fast as the total business analytics software market.
The study, “Worldwide Business Analytics Software-as-a-Service Forecast, 2008-2013,” shows that the number of business analytics SAAS users will grow at rate of 22.4 percent through 2013, growing rapidly from an initially small base. However, market revenue will remain low relative to on-premise software throughout the period, IDC said.
“The business analytics SAAS market is poised for rapid growth as more organizations turn to cloud-based computing and alternative deployment options,” said Brian McDonough, research manager for IDC’s Business Analytics Solutions research service, in a statement. “Growth expectations must be tempered as revenue generation gains traction behind user adoption.”
As more and more business analytics software providers move to address increasing market demand for software that is updated frequently, hosted offsite, and can be purchased on a subscription basis, several factors will help aid in driving this growth. According to an IDC press release on its business analytics study, these factors include:
“– Capital expenditure policies and budget constraints make SAAS offerings more attractive as they enable departments to subscribe to software services using operational budgets.- IT resources are strained and there is insufficient time to build, buy, or evaluate specific solutions for various business problems, putting control of technology decisions into the hands of the business user.- Additional software functionality built on new platforms is suitable for SAAS delivery since there are well-established best practices that can be configured, rather than customized, through a flexible platform to suit most business needs.“
IBM announced plans to build analytics cloud services in the spring of 2009. Later, on Nov. 16, 2009, IBM announced its private cloud computing environment for business analytics, which launches internally with more than a petabyte of information, equivalent to 20 million four-drawer filing cabinets filled with text, which stacked end-to-end would circle the entire planet Earth. And to share the success models of this internal project, IBM also announced a new solution for clients to build their own private cloud environments based on this architecture, called IBM Smart Analytics Cloud.