Microsoft has catapulted to the top of the software-as-a-service (SaaS) market but the software and cloud services giant doesn’t have time to rest on its laurels. Two major rivals, Google and Oracle, are filling up the rearview mirror fast.
In the fourth quarter (Q4) of 2016, the enterprise SaaS market registered a 32 percent year-over-year gain to nearly $13 billion, reported Synergy Research Group today. Over the next three years, the analyst group expects the SaaS market to double in size, as vendors push to turn their on-premises customer bases into cloud subscribers. There’s also room for upstarts like Workday and Zendesk, which are aggressively going after the incumbents.
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Atop the heap of providers sits Microsoft for the third consecutive quarter and after having wrested the number one spot from Salesforce. The largest growth segments for the Redmond, Wash. tech titan are enterprise resource planning (ERP) and collaboration, noted John Dinsdale, chief analyst and research director at Synergy Research Group.
“Back in Q2 Microsoft took over from Salesforce as the overall market leader, driven in particular by the growth of Office 365, and it maintains that leadership position – but it is not the highest-growth major vendor,” stated Dinsdale in a research note sent to Datamation. “That accolade goes to Oracle and Google.”
Google, in particular, is pushing its G Suite of collaboration apps. During the company’s Google Cloud Next 2017 conference this week in San Francisco, the company announced several new enhancements aimed at corporate customers, including a new Slack-like experience in Hangouts and some artificial intelligence (AI) capabilities sprinkled across the product suite.
“Beyond meeting enterprise needs, we have been looking to the future by regularly adding machine intelligence innovations throughout our G Suite products,” wrote Prabhakar Raghavan, vice president of Apps at Google Cloud. “For example, Explore in Sheets lets you skip complex formulas and ask questions in a natural language, Calendar Find a Time intelligently avoids scheduling conflicts and suggests alternatives, and Quick Access in Drive (which starting today also works with Team Drives on iOS and Android devices, and is coming soon to the web) uses context to automatically surface the most relevant files you need.”
Google’s efforts were already paying off prior to these upgrades. The company is currently ranks third behind Microsoft and Cisco in SaaS collaboration.
Pedro Hernandez is a contributing editor at Datamation. Follow him on Twitter @ecoINSITE.