Forrester: SaaS And Data-Driven “Smart” Apps Fueling Worldwide Software Growth

Forrester Research is citing SaaS and data-driven smart apps as the major growth engines for the worldwide software market.

The SaaS software market will increase 25 percent in 2013 to $59 billion, a 25 percent increase. In 2014, the market is expected to total $75 billion. Forrester uses the term “smart computing” to define apps that, for instance, provide direct access to data for decision-making. It also includes data analytics and business intelligence in the category.

The research firm forecasts the smart computing software market to be $41 billion in 2013, increasing to $48 billion in 2014. According to Forrester, these smart-process apps overlap with SaaS products “because the browser-based access model for SaaS products works better for collaboration among internal and external participants than behind-the-firewall deployments.” As a corollary, these smart computing products, like SaaS, are growing far faster than the overall software market.

Here’s a look at the overall market:


And the overall rankings:


Some of the more noteworthy findings come from what sectors will fall behind this year. Forrester cites Google Apps as putting pressure on desktop apps, which will increase just 4 percent this year. Enterprise content management will decrease 26 percent.

Interestingly, the area of highest growth is in what Forrester cites as “other,” meaning embedded apps that are added to software, such as CRM or ERP solutions.

Many of Forrester’s findings are not a surprise as we ease into 2013. The new year will be more about the dynamics of what comes into play as these trends unfold.