Microsoft Leads $101B SaaS Market Followed By Salesforce, Adobe

The same five enterprise software giants continue to lead in SaaS, but they only hold half the market between them. Collaboration and HR solutions are the fastest-growing segments.

Software as a Service closed 2019 as a $101 billion market that had seen little shakeup among its top performers over the past year, according to the latest analysis by Synergy Research.

While Infrastructure-as-a-Service is dominated by a few hyperscale giants, the cloud-based application market remains diverse and wide-open—Microsoft ended the fourth quarter as the leading player with 17 percent share.

Salesforce, which Microsoft overtook as the SaaS leader in 2016, followed with a 12 percent share. Adobe took third place with 10 percent, and SAP and Oracle both brought up the rear of the top five with 6 percent share.

[Related: Microsoft, Salesforce Help SaaS Spending Reach $100B Run Rate]

As the overall SaaS market crossed the $100 billion threshold in 2019, nearly half of those sales were made by companies not among the five leaders.

The market share numbers aren’t much different from what they were at the end of Q4 of 2018, as Microsoft and Salesforce gained only half-a-percentage point in share over the year, John Dinsdale, Synergy’s chief analyst, told CRN.

Stability among the leaderboard doesn’t mean SaaS, which consists of many diverse segments, isn’t scaling fast—the entire market has doubled over the last three years.

None of the market leaders saw the highest rates of growth. That distinction fell upon smaller players like Dassault Systemes, Atlassian, VMware and ServiceNow, Dinsdale told CRN.

Collaboration was among the fastest-growing segments of SaaS, helping Microsoft, which offers various collaboration tools as part of its Office 365 suite, to maintain its perch. That trend also boosted vendors like Cisco and IBM.

Human resources and human capital management solutions also performed well, empowering vendors like Workday, Intuit, and ADP.