No matter where in the world a small or mid-sized business is located, it’s probably safe to assume that one of the biggest headaches – and largest cost not associated with driving revenues – is associated with managing software and other IT needs. These businesses often don’t have the in-house expertise to manage the IT infrastructure, or they cannot afford to purchase the edgy, high-end, productivity enhancing solutions with which large companies have the luxury to experiment.

Enter software-as-a-service – or SaaS – which can level the proverbial “playing field” and enable SMBs to focus on their mission of growing revenue and building their businesses. SaaS offerings are ideal for SMBs because they are typically easy to deploy and use, minimizing the need for training. Since you only pay for what you need, costs are minimized. There’s minimal infrastructure require because the software is hosted at the vendor’s site. And SaaS solutions are continually maintained and kept up-to-date by the vendor, so they can evolve as the SMBs’ needs change.

Use of SaaS solutions is taking off in Europe. In a survey of more than 1,600 SMB decision makers in eight European countries conducted by VMware last month, 73 percent of respondents in continental Europe indicated they are using cloud computing or SaaS.  However, there is a disparity in the United Kingdom, where only 57 percent of SMBs have virtualized parts of their IT infrastructure. Despite the advantages of SaaS, SMBs in the United States are lagging even further behind their U.K. counterparts. More than two thirds of SMBs in the U.S. continue to use premise-based software, according to research from Access Markets International Partners.

But the tide appears to be turning.  According to a recent market assessment by In-Stat, small business spending on public cloud services in 2010 was roughly $3 billion, and this is expected to increase more than 100 percent between now and 2014.  In fact, the researchers noted that SOHO and small businesses will account for roughly 65 percent of the public cloud computing market in 2014.

“Web hosting and data storage are the most obvious IT needs that can be addressed by public cloud services,” Greg Potter, Research Analyst at In-Stat, said in an article that appeared in the Business Technology Roundtable Blog. “With the advent of [SaaS] offerings many businesses are realizing that much of their IT needs can be fulfilled without the need for expensive networking equipment and high-end computers.”

As SMBs in Europe – not to mention around the world – look to technology to give them a competitive edge, it’s clear that the move to SaaS offerings will allow them to focus on their core business and how to grow in today’s global economy.

Ed Peek
VP, Worldwide Sales