Tekrati has a port summarizing a gartner report on SaaS , Below are highlights or excerpts from the same:

software as a service (SaaS) represented approximately 5 percent of business software revenue in 2005 and by 2011, 25 percent of new business software will be delivered as SaaS according to Gartner. Naturally, applications outsourcing via SaaS has varied significantly by market segment. Looking ahead, Gartner sees several changes, including the focus of SaaS and related purchasing and sales processes.

The adoption of the SaaS software delivery model has varied significantly by market segment.

• SaaS accounted for approximately 8 percent of CRM total software revenue in 2005 (Gartner estimates 2006 SaaS revenue to reach 12 percent of total CRM software revenue)
• integration as a service had 10 percent adoption in its market.
• Other markets, such as the ERP and supply chain management segments, had less than 4 percent adoption.

"The majority of SaaS deployments continued to be focused in individual departmental initiatives, such as sales force automation, except in small and medium size businesses (SMBs).

In SMBs, we are beginning to see vendors provide capabilities to support more end-to-end processes, such as opportunity to order and in integration as a service where companies are already using SaaS for large projects," Mr. DeSisto said. "However, no provider offers the functionality capability or process management capabilities on par with on premise software to support end-to-end cross departmental business flows."

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Prashanth Rai