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Summary of our market study
French SaaS (Software as a Service) market estimated at $7 billion
The global SaaS (Software as a Service) market is estimated at nearly $300 billion. It is expected to continue growing at a rate of 20% per year.
Growth drivers include the widespread adoption of mobile devices, artificial intelligence and cloud computing.
The European SaaS market is expected to reach €56 billion by 2022.
The French market for cloud solutions is expected to exceed 27 billion euros by 2025. SaaS accounts for 50% of software publishers' sales.
SaaS products apply to messaging, CRM and human resources management.
A significant proportion of SaaS sales (81%) come from the private sector, particularly large corporations.
Small and medium-sized enterprises (SMEs) have a lower-than-average adoption rate of SaaS solutions.
Around 30% of French companies use cloud computing solutions, compared with the European average of 40%.
The subscription model seems to be the favorite of software publishers and customers alike, with 70% of companies preferring this contractual arrangement.
SaaS player.
- Microsoft: A major player in the sector
- IBM
- Oracle
- ADP: Traditionally known for its payroll services
- Salesforce: CRM giant
- SAGE: Focused on accounting and financial management, SAGE has made considerable progress in its transition to the cloud.
- Cegedim: Specializing in the healthcare sector, Cegedim offers a variety of SaaS solutions
- Sopra Steria
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Summary and extracts
1 Market overview
1.1 Market definition
SaaS - "software as a service" - is a new software distribution model. Two characteristics distinguish SaaS from traditional software: remote use and price.
In the case of traditional software, it is used as a physical product, of which the user acquires definitive ownership on purchase. The purchase of the Office Family Pack is a typical example of this first type of software.
SaaS, on the other hand, is used remotely, with variable pricing. According to GartnersaaS can be defined as "an application that is owned, offered and managed by one or more vendors. The provider offers this application on the basis of a set of codes and definitions relating to the data used, based on a "one-to-many" model. one-to-many " model, with revenues indexed to frequency of use or generated on a subscription basis. Salesforce and SAP are among the best-known and most widely used examples. SaaS is therefore not used as physical software, but as virtual software used as a service through the cloud.
However, understanding the SaaS market remains variable, given the complexity of the services offered by software publishers.
Two approaches are possible:
- SaaS is seen as a software product in its own right, meeting a specific business need, such as human resources management. SaaS is then an integral part of the cloud computing system.
- When it comes to marketing, SaaS is seen as an IT solution that can be marketed in the same way as hardware (a computer) or a service (consulting, for example), but as a subscription rather than an acquisition.
In the first approach, SaaS is the ultimate pillar of the three elements used by cloud computing. The aim of cloud computing is to make computing or storage capacity available to users, whether private or public, remotely. SaaS thus complements the other two pillars of cloud computing. The first is infrastructure - or "IaaS" (Infrastructure as a Service) - which is required to set up a remote network. The second, the platform - or "PaaS" (Platform as a service) - enabling the establishment of a dedicated environment for hosting the software that SaaS represents.
From this perspective, SaaS is the heir to application services, known as ASP (Application Service Provider). SaaS orchestrated a fundamental difference from its predecessor, whose principle was to install and use applications directly on a computer. By revolutionizing the use of applications via the Internet, SaaS has not only changed the way applications are used - the main benefit of which lies in their remote use - but also the possibilities for integration and partnership.
From a commercial point of view, SaaS is integrated into the software segment, and is therefore one of the three traditional segments of the IT industry, alongside hardware (i.e. computer, mobile) and software.i.e. computer, mobile) and services (i.e. management consulting and database integration). The software segment covers networking, development and usage applications. These applications are either physical (traditional software) or remote (SaaS).
SaaS is designed for both private and professional use. In this context of professional use, SaaS supports companies across the entire value chain. Several categories of software are commonly distinguished:
- Enterprise resource management (e.g. accounting, suppliers). This software is known as ERP - Enterprise Resource Planning;
- Customer relationship management (e.g.: relationship history). These are known as CRM - Customer Relationship Management;
- Product management (e.g. after-sales service, localization). These are known as PLM - Product Lifecycle Management;
- Office automation (e.g. spreadsheets);
- Design (e.g. computer-aided manufacturing).
By 2021, 45% of software sales will be generated by SaaS. This percentage is set to increase at the expense of traditional software, for a variety of reasons (lower cost, more practical, etc.).
1.2 A fast-growing global market
evolution of worldwide SaaS revenues World, **** - ****, in billions of dollars
The global SaaS market is estimated at $***.** billion in ****, and is expected to grow at a CAGR of **.*% over the period ****-****, reaching over $**** billion by the end of this period. The growing use of mobile devices and artificial intelligence ...
1.3 The French market: a dynamic market with great potential
The SaaS model, a segment of the software market, is growing in popularity in France. In ****, **% of software sales will be generated by SaaS, whereas in ****, this segment represented only **%[***].
The market for SaaS solutions France, **** - ****, in billions of euros Source: ****
The French SaaS market has been enjoying sustained growth ...
2 Demand analysis
2.1 Large companies, the main customers
Demand driven by industry, the public sector and finance
As the SaaS market's main outlet, the private sector (***) represents the main development opportunity for software suppliers. From the outset, SaaS software has been designed to optimize and facilitate the management of day-to-day business activities, such as accounting and product management.
Breakdown ...
2.2 Demand driven by the democratization of cloud computing
First and foremost, this democratization requires high cloud software penetration rates. Certain sectors are more or less sensitive to the use of this type of software, but overall penetration rates are significant:
Office cloud software penetration rates by sector France, ****, in % of companies INSEE
in the transportation sector, for example, the ...
2.3 SaaS: an internationalized service
A large proportion of software publishers' sales, **% of which are generated by SaaS solutions, are generated abroad:
Breakdown of software sales by geographic region World, ****, in Source: ****
Indeed, foreign sales account for **% of the total, down slightly from **% the previous year. This proportion has remained relatively stable over the past five ...
2.4 Demand drivers: the subscription contracting method
As explained earlier, one of the advantages of the SaaS model is economic. Indeed, the subscription format appeals not only to customers, but also to publishers. This explains the resilience of the SaaS market during the pandemic.
Software publishers' preferred method of contractualization France, ****, in Source: ****
In fact, **% of the *** software ...
2.5 Demand drivers: customer relationship management (CRM)
Customer relationship management is part of a policy of mastering customer knowledge and monitoring customer exchanges. While the latest software products combine these two practices, there are also contact centers that make the most of the data they collect, and support their customers in their decision-making thanks to steering tools, key ...
2.6 Barriers to SaaS demand
As SaaS solutions are not perfect, it's important to point out the few drawbacks of this model that are likely to dampen demand. These include[***]:
the need for a good Internet connection: no offline use, so the company is entirely dependent on the quality of the connection; strong dependence on the ...
3 Market structure
3.1 SaaS market value chain
Source: ****
3.2 The software market: a fast-growing market
A first positive sign for the SaaS market is that software publishers' sales are rising sharply, which testifies to the dynamism of demand on the software market (***):
Trend in total sales for software publishers France, **** - ****, in billions of euros Source: ****
The software market has indeed seen significant growth since ****, with ...
3.3 A segmented software market
Among software publishers, it is possible to distinguish between sector-based publishers (***) and individuals and games, representing a very small share of the publishing market. The breakdown of players in the software publishing market is as follows:
Sales by publisher category France, ****, in billions of euros Source: ****
Sector-specific publishers are the biggest ...
3.4 R&D, cybersecurity, CSR, recruitment, external growth and distribution: current market challenges
Research and development
Innovation is a top priority for French software publishers, as evidenced by their significant investment in research and development (***). Indeed, they devote **% of their sales to R&D, and a third of their total workforce is dedicated to these activities:
Evolution of R&D workforce as a percentage ...
3.5 Interview with Alex Delivet, founder of Collect
Marine: Welcome to the Niche, the podcast that analyzes the niche market with the entrepreneurs who are shaking things up. I'm Marine and I work at Businesscoot, the start-up that's dusting off market research. Before you start, subscribe to our podcast on Spotify and Apple Podcast. And now for today's niche: ...
4 Offer analysis
4.1 From product price to service price
SaaS implies a new way of pricing
In their ADP versions, software followed a traditional pricing logic: the software end-user paid a fixed price upon acquisition.
The development of the cloud has brought about a fundamental shift in software pricing, for two reasons.
Firstly, the flexibility, scale and interaction offered by ...
4.2 A protean SaaS software offering
It's important to differentiate between the three layers of service offerings that can coexist today:
IaaS (***): basic infrastructure in the form of computing, storage and bandwidth capacity. It's an offer aimed at businesses, but above all at application service providers. Amazon Web Services is typical of this category, with its offer ...
4.3 SaaS software offerings and inflation
The SaaS market is no exception to the high inflation experienced by French consumers over the past two years. **.**% of SaaS software increased its price between **** and ****.
SaaS price increases by subscription type France, **** - ****, as % of total Source: ****
Software prices rose by over *% on average between **** and ****, slightly more than ...
5 Regulations
5.1 Regulations governing SaaS
As a processor of its customer's personal data, the SaaS software publisher has a great many obligations with regard to Regulation EU ****/*** of the European Parliamenten and of the Council of April **, **** on the protection of individuals with regard to the processing of personal data and on the free movement of ...
6 Positioning the players
6.1 Segmentation
The SaaS market can be divided into three categories:
Leaders. This group brings together the market's historical players, who developed the first computerized management solutions for businesses from the ****s onwards, and have gradually made their offerings more complex. Most of these companies are American, and offer generalist services. Adapting their ...
6.2 Summary of key points
The French SaaS market has experiencedsustained growth since ****, with a clear acceleration from **** onwardsto reach record sales of* billion in ****, compared with *.* billion in **** and *.* billion in ****.
Demand
Lhe private sector accounted for **% of Saas sales in ****. Industry (***) are the main private-sector outlets. The public sector accounts for **% of demand.
The ...
- Cegedim
- IBM
- Oracle
- ADP LLC
- Sopra Steria
- Citrix
- Algolia
- Talend
- Sage
- XEFI
- Aircall
- SAP
- Atos Eviden
- Microsoft
List of charts presented in this market study
- Global SaaS revenue growth
- Breakdown of SaaS market share
- The SaaS market
- Breakdown of SaaS market sales, by sector
- Cloud solutions market trends
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Latest news
Atos recovers just before the Olympic Games - 12/07/2024
- - Number of employees: 94,000.
- - Creditor commitment: 1.5 billion euros, plus 575 million euros in short-term liquidity to implement the restructuring agreement.
- - Atos plans to reduce its net debt by 3.1 billion euros to 5.2 billion euros restated at the end of 2023.
- - A capital increase of 233 million euros is planned.
- - Bankers and hedge funds plan to take control of the company by the end of 2024, with no one holding more than 10% of the capital.
- - Negotiations with the French government and industrial partners (Thales and Dassault cited) are continuing for systems useful to Atos' nuclear deterrence and intelligence services, with an offer of up to 700 million euros.
Atos, the Layani gamble - 20/06/2024
- CEO of One Point, largest shareholder in Atos
- - Atos company size: 94,000 employees
Thales ready to invest in defense information systems and eavesdropping for Atos - 03/05/2024
- - Value of recent Imperva acquisition by Thales: €3.6 billion.
- - Thales' position in the world cyber rankings following the Imperva acquisition: Top 5.
- - Estimated annual revenues for MCS (Mission Critical Systems): €200-300 million.
- - Estimated total portfolio of Atos' BDS (Defense and Security) division: 1.5 billion euros.
Lyon-based Xefi boosts its digital growth - 02/02/2024
- - The company is investing 60 million euros in a new site in Rillieux-la-Pape, near Lyon.
- - The company currently has 2,000 employees, but plans to increase this to 700 at the new site within 18 months.
- - The future 17,500 m2 site will comprise four buildings, including offices for the 500 head office employees, a sixth 80-bay data center, a brasserie and a training center.
- - The company has five data centers, two of which are HDS-certified (for healthcare data hosting).
- - The company has sales of 355 million euros, with growth of 16% by 2023 and 100% by 2020.
- - It has around 180 branches, including 160 in France, and serves 100,000 customers.
- - Xefi is expanding in Europe, with branches in Belgium, Switzerland and Spain.
- - The company plans to have 250 branches in France by 2026 and 400 in Europe, expanding into Italy, Germany and the Netherlands.
- - One of the company's development processes is franchising, enabling proximity to customers.
- - In December 2021, Xefi took over Novatim, a company based in Courbevoie, France
Atos: an explosive case - 30/08/2023
- Atos has entered into exclusive negotiations with EP Equity Investment to sell Tech Foundations, its indebted historical division.
- The Atos group has 110,000 employees.
- The proposed plan involves Atos becoming "Eviden" and remaining listed on the Paris Stock Exchange, while the "Atos" name and outsourcing activities will be sold to Kretinsky and delisted.
- A capital increase of 720 million euros is planned, as well as the acquisition of a 7.5% stake in Eviden by Kretinsky
Atos hopes to turn the page on the crisis thanks to Kretinsky - 02/08/2023
- Daniel Kretinsky has announced plans to buy Atos' outsourcing business.
- He has spent just over 200 million euros to become the largest minority shareholder in Atos' Eviden division, with activities in cybersecurity.
- Atos has divested itself of a business that accounts for more than half of its sales, but is in decline and loss-making.
- In June 2022, Atos implemented a radical restructuring plan with 7,500 job cuts and a bill of 1.1 billion euros.
- The outsourcing activities of Atos (taken over by Daniel Kretinsky) were placed in an entity called Tech Foundations.
- The acquisition by Kretinsky concerns all Atos outsourcing activities, which generated sales of over 6 billion euros in 2022, and has 52,000 employees.
- The acquisition cost is symbolic, but includes the assumption of all liabilities (nearly 10 billion euros) of the branch.
- Atos will be renamed Eviden and will remain listed on the stock exchange.
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