SMBs Still the Fastest-Growing Cloud Services Customer Segment

SMBs Still the Fastest-Growing Cloud Services Customer Segment

By Gary Kim

Small and mid-sized businesses remain the fastest-growing segment for cloud services, with the global market for SMB cloud services expanding at a 28 percent compound annual growth rate to $95 billion by 2015, according to Parallels SMB Cloud Insights.

Storage is an opportunity for “Infrastructure as a Service” providers, and 50 percent of SMBs are willing to pay more for increased storage. But “Software as a Service” probably still represents the overwhelming bulk of cloud revenues, globally, as has been the case for years.

Small- to medium-sized businesses likewise are seen as a customer segment seen as highly receptive to communications service provider cloud offerings as well, according to Ernst & Young.  

Keep in mind that communications service providers so far have relatively small share in the market. One 2011 analysis of top cloud services providers does not have a single service provider on the list, for example.

Website building tools are a key way to differentiate service offerings, the Parallels study suggests. Currently, 22 percent of U.S. SMBs are building and managing their websites with such tools, and 30 percent report they plan to adopt website building tools by 2015.

Globally, the 2012 cloud services market has grown to $45 billion as at least six million net new SMBs entered the cloud market for the first time in 2012. The global market will continue to grow at 28 percent CAGR through 2015 to a forecasted $95 billion, Parallels projects.

In the United States, the SMB cloud market is now worth $18.9 billion and is forecast to grow at a 19-percent CAGR through 2015. Growth is driven by Software as a Service applications, which saw 60 percent growth in 2012.

Service bundles seem to be a key part of current sales strategies, as 68 percent of SMBs indicated they would prefer to buy their cloud services as part of a discounted bundle.

The Brazil SMB cloud services market will grow by 33 percent year-over-year for the next three years, reaching $2.6 billion by the end of 2015, according to the study.

The Mexico SMB cloud services market grew 30 percent in 2012, and will continue to grow at 45 percent over the next three years, making it one of the world’s fastest growing SMB markets.

SMB Cloud Insights reports are available for download at http://www.parallels.com/SMBreport and within the Parallels Service Provider PartnerNet Portal. Four new reports will be available online on February 8, 2013.




Edited by Rachel Ramsey
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