SMAC to Drive 26% Software Revenue By 2017

by CXOtoday News Desk    Dec 13, 2013

smac

Emerging technologies such as Social, Mobile, Analytics and Cloud (SMAC) as well as information will impact enterprise software buying significantly in the coming years. Gartner predicts that by 2017, these technologies will drive more than 26% of the total enterprise software market revenue, an increase from 12% in 2012. This represents over $104 billion to new worldwide enterprise software revenue from cloud, information, mobile and social initiatives in 2017, says the research firm.

These disruptive forces which the research firm collectively terms as the ‘Nexus of Forces’, will reach mainstream status in 2014 and create new technology requirements that will drive new purchasing trends. “Starting in 2014, the enterprise software markets will undergo their greatest level of disruptions, growth and new opportunities since the year 2000,” said Tom Eid, Research VP at Gartner.

According to Eid, these technologies, some of them are just getting into the mainstream must be evaluated, analyzed and understood as adjacent and synergistic and not solely as independent or non-connected entities. 

While there has been a great deal of excitement from the vendor community regarding cloud, information, mobile, social, and other forces and technologies, adoption in organizations and businesses has yet to catch up with the hype.
-Tom Eid, Research VP at Gartner

Cloud-Based Services

Cloud and SaaS popularity and adoption have continued to increase in the past 5 years, as CIOs are under pressure to mitigate operational costs and look for less-capital-intensive yet efficient alternatives. Going forward, cloud-based offerings need to be tailored to specific needs and requirements, states Gartner. More comprehensive and mature usage of cloud-based offerings will be more strategic and frequently represented by long-term projects to transform technology, accessing with oversight and funding from IT management. 

Information and analytics

While business intelligence (BI) and analytics have been a top CIO priority for years, the new spending is currently driven from outside the IT department. BI, analytics and data analysis are well-established for most large companies in traditional subject areas, such as finance and sales, but there is still extensive growth potential for diagnostic, predictive and prescriptive projects. The emerging data-as-a-service trend is anticipated to significantly grow the market for BI and analytic platforms. Today, the business model is largely “build” driven. However, organizations increasingly will subscribe to industry-specific data services that bundle a narrow set of data with BI and analytic capabilities embedded. 

 Mobility

Emphasis over the next few years will be on providing enterprise-class support for mobile data and applications, rising on top of the existing enterprise mobile architectures. This will be driven by key technologies, such as enterprise mobile management systems, enterprise application stores and mobile collaboration. Tablet and mobile users are demanding mobile device applications that exploit the capabilities of these devices and that can integrate into existing corporate systems. This trend is pushing the application software market in a new direction, and a mobile application product strategy has become a strategic imperative for all application vendors. 

Social and Collaboration

The promise of the converging social, mobile, cloud and information forces is directly relevant to delivering successful collaboration and social software initiatives. For organizations that are looking to move from an initial or trial phase to a richer experience and more sophisticated stage of usage, emphasis shifts to focusing on collaboration in the context of work activities. This includes enterprise-level commitments for collective intelligence, community building, knowledge sharing and virtual teaming as key drivers of expanding and enhancing usage. IT managers need to work with their users so that social and collaboration software blends naturally with the tasks they need to carry out every day.