Study: Enterprises warm up to SaaS, but concerns remain

Enterprises are warming up to SaaS products, but significant concerns hold back their adoption.

Adoption of hosted applications among large companies jumped last year, but many CIOs and IT managers will not consider these software-as-a-service (SaaS) products due to concerns about security, cost and integration, according to a Forrester Research study.

In a 2007 survey of just over 1000 IT decision makers, 16 per cent said their companies were either already using or piloting SaaS products, a 33 per cent increase from 2006.

Those who said they were either interested in or planning to pilot hosted applications remained the same at 46 per cent, while those who aren't interested dropped from 41 per cent to 37 per cent, Forrester said in the report, issued Wednesday.

Respondents who are favourable to SaaS products cite shorter implementation, lower up-front costs and pay-as-you-go pricing as reasons, wrote analyst Liz Herbert, the report's author.

Interest in SaaS isn't consistent across application categories. Popular applications include those for human resources, collaboration and customer relationship management. SaaS is less used for enterprise resource planning, supply chain management and Web 2.0 tools like wikis, blogs and RSS.

Respondents who aren't considering SaaS products cited limitations in the ability for hosted applications to be integrated with software they have installed in-house and to be customised. These IT executives also believe that hosted applications that are leased and paid for under a subscription model cost more in the long run than software that is bought and installed on the company's servers. They also mentioned a variety of security concerns, including fear about having the software and data hosted in a third party's datacentre and concerns about application performance and availability.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Juan Carlos Perez

IDG News Service
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?