Software as a Service Market Will Expand

IDC – Press Release – 26 Jan 2009
Software as a Service Market Will Expand Rather than Contract Despite the Economic Crisis, IDC Finds

FRAMINGHAM, Mass., January 26, 2009 – Recent IDC surveys and customer interviews support the finding that the harsh economic climate will actually accelerate the growth prospects for the software as a service (SaaS) model as vendors position offerings as right-sized, zero-CAPEX alternatives to on-premise applications. Buyers will opt for easy-to-use subscription services which meter current use, not future capacity, and vendors and partners will look for new products and recurring revenue streams. As such, IDC has increased its SaaS growth projection for 2009 from 36% growth to 40.5% growth over 2008.

“With a broad slowdown across IT sectors, businesses are increasingly bearish about their short-term ability to invest, whether for stability, growth, or cost savings down the road,” said Robert Mahowald, director, On-Demand and SaaS research at IDC. “But SaaS services have benefited by the perception that they are tactical fixes which allow for relatively easy expansion during hard times, and several key vendors finished the year very strong, reporting stable financials and inroads into new customer-sets.”

Additional findings from the IDC study include:

By the end of 2009, 76% of U.S. organizations will use at least one SaaS-delivered application for business use.
The percentage of U.S. firms which plan to spend at least 25% of their IT budgets on SaaS applications will increase from 23% in 2008 to nearly 45% in 2010.
This market’s growth prospects will accelerate the shift to SaaS for the whole value chain as the promise of a recurring revenue stream, and the opportunity to tap OPEX and project-related dollars, will benefit the whole SaaS ecosystem.
While demand for SaaS is strongest in North America, new contracts from customers in Europe, Middle East, Africa (EMEA) and Asia/Pacific (excluding Japan) also look particularly positive, and IDC expects that by year-end 2009, nearly 35% of worldwide revenue will be earned outside of the U.S.
On the downside, IDC interviews with SaaS providers highlighted several issues, such as cash-flow shortfalls related to slow-paying current clients, liquidity challenges stemming from tight credit at lenders, and — on the horizon — limited resources to scale up with expanded infrastructure to support new customers and new service offerings.
The IDC study, Economic Crisis Response: Worldwide Software as a Service Forecast Update (IDC #215504) augments other revised IDC forecasts by offering a post-2008 financial crisis update for the worldwide SaaS market, and specifically updates Worldwide Software on Demand 2008–2012 Forecast and 2007 Vendor Shares: Moving Toward an On-Demand World (IDC #213197, July 2008).

Contact

For more information, contact:

Robert Mahowald
rmahowald@idc.com
508-988-6701

Return to economic growth by mid-2010: Canada’s CAs

Return to economic growth by mid-2010: Canada’s CAs

TORONTO, April 29, 2009 — Two-thirds (67 per cent) of senior level chartered accountants interviewed for the most recent CICA/RBC Business Monitor (Q1 2009) expect Canada to experience economic growth by the end of the second quarter of 2010.

In the interim, respondents predicted declines in revenues and profit for their own businesses in the year ahead – averaging a 3.9 per cent decrease in revenue and 4.3 per cent decrease in profit, which is a significant shift from the same time last year when respondents predicted revenue growth for their own businesses of 2.4 per cent and profit growth of 1.3 per cent. Read more

Dow, S&P 500 fall to 1997 levels as sagging confidence pulls stocks lower; Dow falls 251

  From Tim Paradis, February 23, 2009 – 4:14 PM

Dow, S&P 500 fall to 1997 levels as sagging confidence pulls stocks lower; Dow falls 251

NEW YORK (AP) – The major stock market indexes have staggered to their lowest levels in more than a decade, pulled down by investors’ rapidly waning confidence.

The Dow Jones industrial average and the Standard & Poor’s 500 index are at the lowest point since 1997, succumbing to growing worries about a recession that has no end in sight.

Most financial stocks were pounded even as government agencies led by the Treasury Department have said they will launch a revamped bank rescue program. It includes the option of increasing government ownership in financial institutions without having to pour more taxpayer money into them.

The Dow Jones industrial average is down 250 at 7,114. The Standard & Poor’s 500 index is down 26 at 743, while the Nasdaq composite index is down 53 at the 1,387.

Declining stocks outnumbered advancers by about 6 to 1 on the New York Stock Exchange. Volume came to a moderate 1.61 billion shares.

TSX falls through November lows as economic worries slam stocks

From Malcolm Morrison, The Canadian Press, February 23, 2009 – 4:17 p.m.

TSX falls through November lows as economic worries slam stocks

By Malcolm Morrison, The Canadian Press

  TORONTO – The Toronto stock market fell through its most recent lows set last November as a fresh wave of pessimism trumped assurances from U.S. regulators on the financial system Monday.

Toronto’s S&P/TSX composite lost 250.9 points to 7,699.1, while New York’s Dow Jones industrials fell 209.4 points to 7,156.3, its lowest level in more than a decade.

Several U.S. government agencies, including the U.S. Treasury Department and Federal Reserve said Monday they will do all they can to shore up the banking system.

The regulators also said they will launch a revamped program to inject fresh capital into financial institutions this week.

The Canadian dollar was down 0.18 cent at 79.86 cents US. .as retail sales in December fell 5.4 per cent in December to $33 billion – the largest monthly decline in over 15 years.

The Nasdaq composite index declined 44.64 points to 1,396.59 while the S&P 500 index slipped 23.2 points to 746.85, after earlier falling to April, 1997 levels.

TSX nosedives in atmosphere of uncertainty

TSX nosedives in atmosphere of uncertainty – TheStar.com - December 02, 2008An avalanche of negative economic news and the uncertainty hanging over Canada’s political future combined to send Toronto’s S&P/TSX composite index to its second worst day ever yesterday.

The 864.41 point drop – a staggering 9.32 per cent – was the biggest one-day percentage loss since the crash of October 1987 and the move erased more than half of last week’s nearly 14 per cent gain.

It came as the Liberals and the NDP finalized an agreement to form a coalition government, with the support of the Bloc Québécois, and a panel of U.S. economists declared that country has been in a recession since December 2007.

Oil fell $5.15 a barrel, more than 9 per cent, to $49.28 (U.S.) after OPEC failed to reach a consensus on the weekend about more production cuts. Gold fell $41.60 to $774.60 an ounce, the most in eight months, on speculation the global economic slump will dampen demand for commodities.