KPMG: Cloud technology market expected to grow 18% before end of 2012

By Rob Starr, Content Manager, Big4.com

A growing number of businesses are adopting cloud-based solutions to suit their IT needs.  According to KPMG’s latest Technology Issues Monitor, the dominant model in cloud computing is now ‘Software as a Service’ (SaaS) which provides businesses with on-demand software, eliminating the need to install and maintain programmes or pay for licences

KPMG’s analysis shows that as the demand for SaaS grows, service providers are competing to launch new offerings and add new capabilities, with many trying to differentiate themselves by introducing industry-specific solutions.  However, a number of high profile problems have ensured that customers still have four key concerns – security, network stability, the limited integration with their existing systems and the time it takes for organisations to implement new technology.

It is a market worth $12.3 billion, worldwide in 2011, with projections to reach $14.5 billion before the end of 2012.

Steve Watmough, partner in KPMG’s CIO Advisory team, comments:

“As the current tight economic conditions are felt across the globe, tight IT budgets are pushing demand for cloud computing services.  The attraction, especially for the smaller business, lies in organisations no longer needing to find funds for infrastructure, deployment or training,” he says. “The need for security means businesses are pushing for stricter governance controls around cloud computing and SaaS.  But security is not where concerns stop and customers are also increasingly emphasising ‘uptime’ and performance in their negotiations with suppliers.”