The total enterprise SaaS 2019 market came in at over $101 billion, which is up 26% from 2018, according to Synergy Research, a company that monitors cloud market share.
The top performers remain the same as the previous year. Microsoft ended the fourth quarter with a 17 percent share. In second place is Salesforce, which followed with a 12 percent share. Notably, the last time Salesforce overtook Microsoft was in 2016. Meanwhile, Adobe took third place with 10 percent. Finally SAP and Oracle rounded out the top five performers with an even 6 percent share. Other prominent SaaS vendors included ServiceNow, Workday, Intuit, Cisco, IBM, and ADP.
“The SaaS vendor landscape essentially breaks out into three camps – traditional enterprise software vendors, relatively new born-in-the-cloud players and large IT vendors that are looking to expand more into software markets,” said John Dinsdale, chief analyst at Synergy Research. “In the first camp you have companies like Microsoft, SAP, Oracle and IBM that have a huge base of on-premise software customers that they can convert to a SaaS-based consumption model. Born-in-the-cloud vendors include Workday, Zendesk, ServiceNow, Atlassian and Splunk, who tend to have much higher growth rates. Meanwhile Google and Cisco are making an impact in the SaaS market, via Google’s G Suite and Cisco’s collaboration apps and multiple software vendor acquisitions. There will be consolidation, with the impending Salesforce acquisition of Tableau Software being a prime example, but there will remain many opportunities for new market entrants to make an impact.”
Within the last ten years, Microsoft's SaaS revenues have gone from zero to more than $20 billion. The last decade has seen Microsoft Office 365 and Salesforce become essential in enterprises using the cloud to access data and workloads. While Salesforce has become a prominent force, Microsoft has had the advantage of utilizing a global network of 120 points-of-presence to help integrate new software services into existing platforms.
Synergy notes that while the market share hasn’t changed much, the market itself has doubled in the last three years. The company also indicated that all major segments are growing, with especially high growth rates across Collaboration and HR/HCM. Synergy forecasts major growth across all SaaS segments and all geographic regions through 2023.