Microsoft Sees Growing SaaS Opportunity Among SMBs

2009 will be the year SMBs start adopting software as a service (SaaS) in earnest, presenting an opportunity for Microsoft and other vendors to offer services to them despite the economic recession, according to a Microsoft survey.

Eighty-six percent of SMBs said they plan to deploy SaaS in their organizations before the end of the year, according to the survey, called the 2009 Microsoft SMB Insight Report, which polled 600 small-business specialists in five countries -- the U.S., U.K., Canada, France and Brazil. Microsoft released the results of the survey, based on information collected in February and earlier this month, on Wednesday.

In an interview about the results, Eduardo Rosini, corporate vice president for Microsoft's worldwide small and midmarket solutions and partners group, said the survey shows that SaaS is at a "tipping point" and the recession could actually be contributing to the projected uptick in adoption.

Fifty-five percent of SMBs surveyed said they were thinking about spending the same amount or even more on IT in the next 12 months, he said. However, they are still interested in "doing more with less" and optimizing the IT resources they already have, he said. SaaS allows SMBs to do that while also letting them embrace new technologies they might not otherwise afford, since they don't have to deploy new IT infrastructure to deploy new software, Rosini said.

"Clearly it's now becoming a very, very viable and preferred option as it comes to laying out new technologies," he said.

SMBs said they were considering replacing the e-mail, document sharing and communications infrastructure that they currently have on premise with hosted services, Rosini said. Microsoft is well-positioned to provide those services to them, he said.

Microsoft began offering its first hosted collaboration services this year with its Business Productivity Online Suite, which combines online versions of Microsoft's messaging and portal software -- Exchange Online and SharePoint Online, respectively-- as well as Office Communications Online, a hosted unified-communications offering, and Office Live Meeting, a hosted Web-conferencing application. Microsoft also sells those services separately.

Microsoft also lets its hosting partners sell hosted versions of its collaboration and messaging software to customers, and Rosini also stressed the importance of Microsoft's VAR community to service SMBs, who often don't have their own IT staff, or who have very few dedicated IT employees.

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