SaaS Enterprise Content Management Growth Study

Over the past decade, the line between enterprise content management and retail products has been steadily shrinking. CMS tools like WordPress and Drupal are equally popular among both individuals as well as among enterprises. On the other hand, tools like SharePoint that offer a vastly sophisticated application are popular among enterprises. According to a recent study conducted by TechNavio, the growth of SaaS based enterprise content management systems (ECM) is expected to continue over the next few years.

Here are a few snapshots from the TechNavio study:

Growth Rate: The compounded annual growth rate of SaaS-based ECM between 2013-2018 is expected to be 31.1%
Market Share: With rise in SaaS ECM, the market share of on-premise ECM tools are expected to naturally come down from the dominant 90.73% that it enjoys today.

The results from the TechNavio study are pretty much in sync with the predictions made by Radicati in their study report last year. In their study, Radicati made the prediction that the revenues from the Enterprise Content Management market will grow from $5.1 billion to $9.3 billion between 2013 and 2017. Given that this is for the entire market, the emerging SaaS platform is expected to be much higher than on-premise ECM that, with a 90% market share, is likely to grow much slower.

There is however a slight bit of disconnect between what TechNavio suggests and the results from a Gartner study published last year. In that report, Gartner had predicted that 12% of the surveyed enterprises use cloud-based ECM tools for their requirements. That is distinctly higher than the less than 10% market share that TechNavio had predicted in their study. None of the reports talk about the specific tools or versions of the software. Business that have migrated their SharePoint to the latest version enjoy easier integration with Microsoft’s other cloud tools like Office 365 and Yammer.

As all these study reports show, enterprise content management appears to be on the rise. With more and more business transactions moving online, the need of the hour is to deploy an agile and scalable solution. With SaaS based ECM, this is much easier. However, on-premise ECM comes with an advantage of high customization that a SaaS solution may not always provide. The future belongs to the platform that can show return on investment to businesses from their content marketing and management.

Oracle Market Share, Revenues And Performance – 2013

There have been a plethora of new-school Fortune 500 tech companies that are based on the internet and gadgets. However, Oracle continues to be one of the biggest software companies in the world. Redwood Shores based Oracle is currently ranked 80 in the list of the biggest companies in the world. Here are some key metrics about Oracle that we have been able to gather.

Year Oracle's position in Fortune 500
2012 82
2013 80

Growth over the last year

Year Growth rate
2012 7%
2013 8%
Last decade 14% CAGR

 

Software vs. Hardware

Software continues to be one of the major growth drivers for the company. According to the most recent press statement, software contributes close to 75% of the overall revenues. Of this, license updates and software upgrades of JD Edwards and other proprietary software contributes to more revenue than the sale of new software licenses.

Business component Jun-Aug 2013 Revenues YoY change
New software license $1.653 billion 5% growth
Software license update $4.431 billion 7%

 

In the hardware business, Oracle isn’t doing so well. Here are some crucial numbers mined from the latest reports. For a perspective, most of these revenues are gained from components of business Oracle got after acquiring Sun Microsystems for $7.4 billion.

Business component Jun-Aug 2013 Revenues YoY Change
Oracle Servers $669 Million 14% drop
Hardware support $592 Million 3% growth
Gross profit margin 61.9%

 

Oracle Ranking & Market Share In Various Businesses

Despite investors losing interest of late, Oracle continues to be one of the largest software companies in the world. Here is the market share of Oracle in some of the business it operates.

Business/Product Rank/Market share
Software company Number 2
RDBS Database 48.3% revenue (Number 1)
ERP (JD Edwards) 13% (Number 2)
Business Intelligence 14.9% (Number 2)

ERP Implementation, Budgeting & Savings Related Statistics For 2013

A survey report released by Gartner earlier this year noted that the ERP market had a sluggish growth last year clocking a rate of just 2.2%. Despite this, the growth of SaaS based ERP solutions are expected to grow at a healthy pace to reach 17% of the market by 2017 (12% in 2012). These projections are further strengthened by a report released by Panaroma Consulting. In their annual ERP report for 2013, the firm has come up with some pretty interesting statistics and projections. Here is a rundown of the various results from the survey.

Type Of ERP Solution Used

A whopping 61% of the firms still use on-premise ERP systems. While this could be disheartening to the proponents of cloud based enterprise systems, what this also reflects is the tremendous potential that cloud ERP solutions have for the future. Here is the market share of the various ERP systems as noted by Panaroma in their report.

ERP System Market Share
On-premise 61%
SaaS 14%
Cloud ERP (hosted and managed off-site) 12%
Others 13%

Reasons Why Companies Are Still Skeptical About Cloud ERP

Most discussions on why cloud ERP are still not dominant veer towards risks like data loss. However, the research reports points out that one of the biggest reasons is lack of knowledge about service offerings. This is a very interesting tidbit since cloud ERP providers only need to enhance their marketing efforts to start seeing much improved adoption rates from businesses.

Reason Percentage of respondents
Risk of security breach 32%
Low awareness 32%
Risk of data loss 17%

Cost Savings From Cloud ERP Migration

One of the biggest advantages to migrating to cloud ERP systems is definitely the cost factor. A survey of various businesses who have made this migration show that the cost savings are pretty decent.

Cost savings in % Percentage respondents
0-20% 60%
21-40% 24%
41-60% 8%
61-80% 0%
>80% 8%

Use Of ERP Consultants

A lot of businesses make use of third party ERP consultants to help them with implementing the system. For example, ERPGuru is a NetSuite partner in Canada that helps in implementing and supporting the NetSuite cloud based business management software. The Panaroma Consulting report notes the use of consultants during the various phases of the project:

Project Phase Consultants employed
Planning 35%
Selection & Purchasing 35%
Implementation 28%
Post Implementation 2%

ERP Implementation Budgeting

One of the concern areas for businesses during implementation of such projects is the overall cost and how it impacts the budgeting. According to the Panaroma report, the implementation of ERP was on budget only around 35% of the time.

Budgeting Occurrence
On budget 35%
25% over budget 31%
26-50% over budget 16%
51-75% over budget 4%
>76% over budget 2%
Under budget 12%

Project Schedule

After budgeting, the next big concern for businesses is whether or not the implementation happens on time. The report reveals the following data.

Duration Occurrence
On Schedule 34%
<25% over schedule 27%
26-50% over schedule 10%
51-75% over schedule 12%
>76% over schedule 12%
Earlier than scheduled 5%

IT Spending In 2010

IT spending by enterprises is expected to see a revival this year following last year’s decline. However, IT spending of the 2008 levels is not expected to happen till next year. Here are some number forecast for 2010 by Gartner

Fall in worldwide IT spending in 2009 : 4.6%
Growth of worldwide IT spending in 2010 : 4.6%

IT Spending in Major Areas (Hardware, Software, ITES, Telecom, Telecom services)
2009 : $3.21 trillion
2010 : $3.36 trillion

Need For Real Time Collaboration A La Google Wave

Google wave is touted as the next big thing from Google assisting in real time collaboration. So if you thought why it is so necessary, here are some recent stats from a Forrester report (the study is close to a year old, but still relevant)

99% of knowledge based workers in USA and Europe collaborate with others at work

70% of American workers and 81% of European workers regularly collaborate with people outside their time zones and geographical locations.

Most Preferred Way, Given a Choice : Telephone, Face-to-Face
Most Preferred Way in actuality : Email

Use of Web 2.0 enterprise solutions : With the exception of Instant messaging, there is very low adoption rate for blogs, wikis, etc.

Given the fact that the most preferred real time collaboration is not in fact so real-time, there is definitely a scope for Google wave.

Information Management on Facebook Servers

Facebook now has close to 300 million users on its social network. Ever wondered what it takes to manage the activities of so many users?

300 million users contribute to 25 Terabytes of log data every day (1000 times over daily volumes handled by US Postal service)

230 engineers are required to manage data for 300 million users.

Facebook data managed on close to 30,000 servers.

20,000 new servers were installed in mid-2008 that cost $100 million

Most Popular Web 2.0 Tools Among Enterprises

Enterprises are looking more and more towards the web in order to be able to communicate better with their clients. These tools are used not just to communicate with customers, but also with suppliers as well as for internal purposes. Here is the percent of surveyed companies using the following web 2.0 to communicate with their customers:

1. Blogs : 51%
2. Video Sharing : 48%
3. Social Networking : 48%
4. RSS : 45%
5. Wikis : 37%
6. Podcasts : 37%
7. Tagging : 23%
8. Rating : 22%
9. Microblogging : 21%
10. P2P : 20%
11. Mashups : 14%
12. Prediction Markets : 9%

Use of Cloud Services in Businesses

Cloud computing and services could be generating craze, but still a whopping 44.1% of the small businesses interviewed do not use them. Here is a statistic on where SMBs use cloud service in their organizations in percentage terms:

Data Backup : 16%
Email : 21.2%
Application : 11.1%
VOIP : 8.5%
Security : 8.5%
CRM : 6.2%
Web Hosting : 25.4%
eCommerce : 6.4%
Logistics : 3.6%
Do not use : 44.1%

Acceptance of Windows Server 2008 Among Businesses

A survey among IT decision makers’ perception revealed the following important statistics:

  • 63 percent shall upgrade to Windows Server 2008
  • 18 percent are already in the process of implementation
  • 35 percent have their businesses equipped with server virtualization at some level
  • 38 percent have no ideas towards server virtualization in the immediate future