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SMB cloud market on the rise

As the private sector makes its way to the cloud, organizations of all sizes are beginning to recognize how the technology can introduce company-specific benefits that will differentiate firms from rivals. Small and medium-sized businesses in particular are experiencing a number of unique advantages when they implement cloud services, enabling them to gain a competitive advantage over enterprises in the same industry.

A recent report by cloud enablement firm Parallels highlighted the growing use of cloud computing among SMBs, noting that at least 6 million SMBs are now using the cloud, which pushed the 2012 market to generate roughly $45 billion in revenue. This adoption is forecast to continue in the coming years, expanding the industry at a compound annual growth rate (CAGR) of 28 percent through 2015, when it will produce $95 billion in revenue.

American SMBs are particularly interested in cloud services because the U.S. private sector is so competitive and decision-makers are looking for innovative ways to reduce expenses during the ongoing macroeconomic crisis. The current U.S. SMB cloud market is estimated to be worth nearly $19 billion and is predicted to increase at a CAGR of 19 percent through 2015. There are several driving forces behind this growth.

What's pushing SMBs to the cloud?
Because smaller firms have fewer exhaustible resources than their enterprise counterparts, decision-makers often look for the most cost-effective way to implement advanced solutions. In regard to the cloud, more than two-thirds of executives said they would purchase hosted services as part of a larger bundle, introducing a unique opportunity for service providers to expand their offerings and client base.

Parallels noted that SMBs are also intrigued by Software and Infrastructure as a Service offerings, as these cloud models provide firms with unique applications, storage and other critical functions needed to survive in today's fast-paced business world.

A separate study by Spiceworks noted that SMB budgets are also on the rise, allowing decision-makers to implement more sophisticated computing tools associated with the cloud.

"Data from this recent survey confirms that the consumerization of IT is flourishing among SMBs, although opinions vary on how to manage its impact on organizations," said Jay Hallberg, vice president of marketing for Spiceworks. "The results also show that SMBs are spending more on technology across the board, from hardware and devices, to cloud services and virtualization."

As the cloud evolves, SMBs will continue investing in the technology to support long-term growth opportunities and goals.

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