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Hybrid Models Lead SMB Adoption of the Cloud

By Charlene O'Hanlon
August 26, 2010 - News

The SMB space is ripe for services delivered through the cloud, but lingering fears over security and data leaks are building a strong case for hybrid cloud model, according to the latest study by AMI Partners.

The report, “Worldwide SMB Cloud Services Study," examines the use of SaaS in the small- and medium-business space, including which applications are gaining the most popularity. Currently, 12 percent of small businesses – about 750,000 – and 24 percent – about 20,000 – of medium businesses are using SaaS. However, 78 percent of small businesses and 31 percent of medium businesses are utilizing a hybrid or SaaS plus on-premise model, mainly because of fears that their data could be compromised in a pure SaaS model.

More than half of U.S. SMBs are considering SaaS as a way to reduce costs and complexity in their IT infrastructure, and about one in five is planning to use SaaS, the report noted. Concerns about the economy are driving the adoption, said AMI Senior Associate Yedda Chew.

“Though cloud computing is seen as the next IT platform, the consideration of SaaS amongst SMBs as the next favorable cost-saving model is expedited by the macro situation we are in today," she said.

In particular, applications that have a direct influence on employee productivity are gaining popularity as SaaS plays, including e-mail, document management and collaboration and security, the report noted. About 134,000 of non-SaaS U.S. SMB users plan to adopt e-mail in the cloud; about 129,000 of non-SaaS U.S. SMB users plan to adopt security in the cloud; and more than 125,000 U.S. SMB users plan to adopt document management and collaboration in the cloud.

The report results highlight the opportunity for the channel to sell cloud-based applications and services, especially in the SMB space. AMI expects global SMB cloud-related spending will reach $95 billion by 2014, with more than 4.2 million SMBs in the United States interested in adopting SaaS.

The AMR report comes weeks after a similar report from IT management software maker Spiceworks, which surveyed 1,500 of its customers about their plans to implement cloud computing. The results showed 14 percent of SMBs are currently using cloud solutions and 10 percent intend to deploy cloud services in the next six months. Similar to the AMR results, the Spiceworks survey revealed that the types of functions most likely to be adopted as cloud services are e-mail at 25 percent, followed by data backup at 16 percent, data storage at 11 percent and security at 8 percent.

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