January 12, 2010 – Business analytics software as a service is expected to grow three times as fast as the total business analytics software market in the five year period between 2008 and 2013, according a new study from market researcher IDC.

With the overall market expected to grow 7 percent through 2013, SaaS growth will reach a compound annual growth rate of more than 22 percent, according to the report, “Worldwide Business Analytics Software-as-a-Service Forecast, 2008-2013.”

And despite industry chatter about whether business analytics SaaS is a viable model after vendors LucidEra and Blink Logic closed their doors last year, the market continues to demonstrate strong demand, said Dan Vesset, program vice president of IDC's business analytics research.

Though the market is experiencing rapid growth - particularly as more organizations turn to cloud-based computing and alternative deployment options - it’s important to remember that it’s still a small portion of the market, says Vesset. Also, market revenue will remain low relative to on-premise software throughout the forecast period.

Nevertheless, several factors are supporting increased investment, according to IDC’s study, including capital expenditure policies and budget constraints that make subscription software services more attractive.

“A lot of the driving factors have to do with the economy, particularly the budgeting benefits of being able to subscribe to solutions rather that paying for the whole thing upfront,” said Vesset.

Additional factors supporting growth are strained IT resources resulting in more technology decision-making from business users, and increased software functionality on new platforms suitable for SaaS delivery, according to the report.

Technology buyers should expect there to be a range of options for how to access software going forward, Vesset said. “This is the beginning of a long-term shift to deployment of business analytics technology.”

Register or login for access to this item and much more

All Information Management content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access