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Microsoft Leads SaaS Market with Continued Growth

Synergy Research Group says Microsoft remains atop the SaaS market with a 17% share thanks to consistent growth performance.


has consistently been the dominant force in the Software as a Service (SaaS) market over the years. During the last quarter, the company continued to lead its rivals by claiming a 17% market share. Synergy Research Group says Microsoft has managed to record growth and extend its lead.

Indeed, the market researcher points to a 34% growth quarter-on-quarter that allowed Microsoft to extend its lead over other SaaS companies. Still, it is worth noting growth is falling for the company. Synergy puts the decline down to Microsoft already growing to huge scale and points out Microsoft's growth is still outpacing the market.

“While Microsoft's growth rate is diminishing due the massive scale it has achieved, over the last four quarters it has averaged 34%, comfortably higher than the overall market growth rate.”

Microsoft is followed in the SaaS market by , Adobe, SAP, and Oracle in the top five vendors list.

These top five companies took over half the total SaaS market, while the following ten vendors claimed another 26%. In other words, around 75% of the total SaaS market is controlled by just 15 vendors.

Included in the second tier of SaaS providers below the top five is , which recorded the largest growth rates during the frame.

Market Success

During Q1, the enterprise SaaS market took over $23 billion in overall revenue, with Synergy predicting the market will surpass a $100 billion annual figure through the next quarter.

“The SaaS vendor landscape essentially breaks out into three camps – traditional enterprise software vendors, relatively new born-in-the-cloud players and large IT vendors that are looking to expand more into software markets,” said John Dinsdale, a Chief Analyst at Synergy Research Group.

“In the first camp you have companies like Microsoft, SAP, Oracle and IBM that have a huge base of on-premise software customers that they can convert to a SaaS-based consumption model. Born-in-the-cloud vendors include Workday, Zendesk, ServiceNow, Atlassian and Splunk, who tend to have much higher growth rates. Meanwhile Google and are making an impact in the SaaS market, via Google's G Suite and Cisco's collaboration apps and multiple software vendor acquisitions.

Luke Jones
Luke Jones
Luke has been writing about all things tech for more than five years. He is following Microsoft closely to bring you the latest news about Windows, Office, Azure, Skype, HoloLens and all the rest of their products.

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