Market researchers Frost and Sullivan are forecasting a compound annual growth rate of more than 27 per cent for the Asia Pacific on-demand software from 2006 to 2009. The market will increase from US$70.3 million in 2006 to US$144.3 million by the end of 2009.
Though most growth will come from SME’s, some large enterprises are also expected to make the gradual shift to hosted applications.
Frost and Sullivan said to sustain that growth rate, software vendors would need to address concerns about infrastructure limitations and data security issues, and to provide a level of confidence in reliability, availability and quality of service.
The research did not cover hosted productivity software, email and security. Rather it focused on traditional enterprise applications like customer relationship management software, web conferencing and collaboration software, human resources software, finance and accounting software, as well as supply chain management systems and enterprise resource planning software.
“The rising number of SMEs, and the increasing adoption of software solutions that provide them with a competitive edge is likely to give rise to greater deployments of on-demand software across the region,” Frost and Sullivan director Subba Iyer said.
“The advantages of web-based accessibility, faster implementation cycles and manageability would appeal to businesses; more so for SMEs.”
CRM software was the dominant solution in 2006, followed by collaboration and HR applications software.
The increasing focus on enhancing customer service and mobility of usage were among the key drivers for the extensive deployments of on-demand CRM software in Asia-Pacific.
Nonetheless, technological and infrastructural limitations, such as inadequate and costly bandwidth in developing countries in Asia-Pacific, remain a major barrier to the adoption of on-demand software solutions.
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