The acceptance of software as a service (SaaS) delivery models, which includes software on-demand and hosted application management, has gathered momentum since 2004 and steady growth is expected to continue through 2009, according to IDC Corp., a research firm in Framingham, Mass. IDC estimates worldwide spending on SaaS reached $4.2bn in 2004 and the IT consultancy anticipates that spending will reach $10.7bn by 2009.
"The role of SaaS delivery in the software industry continues to grow. Traditional software players have recognized the importance of SaaS and numerous SaaS-focused companies are entering the marketplace," says Erin Traudt, research analyst for IDC's SaaS program. "Until recently, sales channels for on-demand software solutions have been almost 100 percent direct.
"Now that the emerging delivery model has gained traction, momentum and validation in the industry, IDC believes that an increase in formalized partnerships and relationships will occur between on-demand providers themselves as well as with hardware vendors, telecommunications companies, business process outsourcers, systems integrators, SaaS aggregators, distribution channels, and SaaS enablers."
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