In 2019, the top 10 Cloud software vendors accounted for nearly 45% of the global Cloud applications market which grew 14% to approach nearly $124 billion in Cloud subscription revenues.
This was the second year in a row as Microsoft surpassed Salesforce to become the No. 1 Cloud applications vendor as the Windows developer benefited from its successes in migrating its army of Office users to the Cloud with Office 365, which now tops 200 million monthly active users. You can read more our analysis here on Microsoft’s expansive Cloud applications strategy.
We ask the simple question: Who’s buying Cloud applications from whom and why? And we provide the answers – supported by decades of research – to our clients around the world. (Sample from our Apps Database)
Through our forecast period, the Cloud applications market size is expected to reach $166.8 billion by 2024, compared with $124.1 billion in 2019 at a compound annual growth rate of 6.1%.
The future of the Cloud applications market is fraught with uncertainty as leading vendors are engaged in a delicate dance that could turn any cordiality into an ugly spat. Collectively the top 10 Cloud applications vendors, as shown in Exhibit 1, hold only 45% of the market, while the rest is splintered into hundreds of vertical and functional segments.
|Exhibit 2: Worldwide Cloud Software Market 2019-2024 Forecast, $M|
|Year||2019||2024||2019-2024 CAGR, %|
Source: Apps Run The World, February 2020
Top 10 Cloud Software Vendors
Software As A Service covers a range of enterprise applications delivered via the Cloud for business functions and processes such as Order to Cash, Hire to Retire as well as industry-specific capabilities like Jail Management Software, Electronic Health Records as well as other apps for 21 verticals in our taxonomy.
The implication is that Salesforce finds itself a formidable competitor in Microsoft that now has the moving parts of its extensive Cloud applications portfolio firing on all cylinders.
Here are the rankings of the top 10 Cloud software vendors in 2019 and their market shares.
|Rank||Vendor||2018 Cloud Apps Revenues, $M||2019 Cloud Apps Revenues, $M||YoY Growth||2019 Cloud Apps Market Share, %||Recent Developments|
|1||Microsoft||Subscribe||Subscribe||27%||Subscribe||Microsoft’s Office 365 Commercial business saw an estimated 29% growth in CY19 to reach $8.1 billion. Dynamics 365 jumped 43% to hit $2.8 billion, while the commercial portion of LinkedIn rose 11% to achieve about $3 billion in the same period.|
|2||Salesforce||Subscribe||Subscribe||37%||Subscribe||Salesforce co-CEO Keith Block stepped down in February 2019 leaving founder Marc Benioff as the sole head of the CRM giant. It ended fiscal 2020 with 29% jump in revenues to $17 billion and the $1.3 billion acquisition of Vlocity, one of its long-time channel partners.|
|3||SAP||Subscribe||Subscribe||39%||Subscribe||SAP’s largest Cloud segment, covering applications, technology and services, grew 38% in 2019, while the Intelligent Spend group, which includes Ariba and Concur, rose 24%. Qualtrics posted more than $400 million in Cloud applications revenues last year.|
|4||Oracle||Subscribe||Subscribe||32%||Subscribe||With tens of thousands of Cloud customers already running CRM, EPM, ERP, HCM and industry-specific applications, Oracle focuses on building out its online infrastructure to better serve them while converting hundreds of its onpremise customers to Oracle Cloud every quarter. It is also making an concerted effort to take marquee customers live on Oracle Cloud apps.|
|5||Adobe||Subscribe||Subscribe||24%||Subscribe||Adobe acquired Marketo for marketing automation and Magento for eCommerce as it pivots from content to CRM. In its latest quarter, Adobe’s Digital Experience revenues including mostly CRM products grew 24%.|
|6||ServiceNow||Subscribe||Subscribe||34%||Subscribe||In 2020, ServiceNow acquired Passage AI for digital assistants in multiple languages and Loom Systems for AI-based IT Service and Operations Management, following a 34% jump in Cloud subscription revenues in 2019.|
|7||Workday||Subscribe||Subscribe||32%||Subscribe||Workday now counts on HCM, Financial Management, Planning and Analytics for its Cloud applications growth, along with its recent acquisition of Scout RFP for e-sourcing. Its developer push will intensify in its latest release Workday 2020 as it strengthens Platform As A Service capabilities such as microservices and enhanced security as part of Workday Cloud Platform.|
|8||Intuit Inc.||Subscribe||Subscribe||38%||Subscribe||Intuit QuickBooks Online subscribers now top 5 million, up from 1.6 million in 2016. Meanwhile, Intuit strengthened working capital management and payment offerings for SMBs, along with same-day payroll processing. The advanced version of QBO offers Live Help capabilities with personalized expert advice on accounting issues.|
|9||Dropbox||Subscribe||Subscribe||19%||Subscribe||Dropbox’s revenues rose 19% in 2019 as paying users topping 14.3 million, compared with 12.7 million in 2018. Average revenue per user per year went up 4.5% to reach $125 last year.|
|10||athenahealth||Subscribe||Subscribe||8%||Subscribe||Athenahealth’s sale to Veritas Capital and subsequent merger with Virence Health, a value-based care company purchased by Veritas from GE, was a complex deal that closed in 2019. The combined company is operating under the Athenahealth brand.|
Source: Apps Run The World, February 2020
Other Cloud software providers included in the report are: 2U, INC., ACI Worldwide, Inc., ADP, Amazon Web Services (AWS), Applied Systems Inc., Atlassian, Aurea, Autodesk, Avalara, Bazaarvoice Inc., Benefitfocus, Blackbaud, BlackLine, Bottomline Technologies, Box Inc., CDK Global, Ceridian, Cisco Systems, Cision, Citrix, Cornerstone OnDemand, Coupa Software, Cvent, DocuSign, Inc., Edgeverve, an Infosys company, Ellie Mae, Eventbrite, FICO, FIS Global, Five9, Google, HubSpot, IBM, iCIMS, Infor, Informatica, Instructure, Inc., Intralinks Holdings, Inc., a SS&C Technologies Company, ION Trading, IQVIA, JDA Software Group, Inc., Khoros, Kronos Incorporated, LexisNexis, a RELX Company, LivePerson Inc., LogMeIn, Inc., Medallia, Medidata, a Dassault Company, Meltwater Group, Mitel, NCR Corporation, Nice Systems, Open Text Corporation, Paychex, Paycom, Paylocity, PTC, Q2ebanking, Qualtrics, RealPage, RingCentral, Roper Technologies, Inc., Saba Software, Sage, SAS Institute, Shopify, Slack, SolarWinds, SPS Commerce, Inc., SugarCRM, SumTotal Systems, a Skillsoft Company, SurveyMonkey, Trimble, TTEC, Twilio, Tyler Technologies, Ultimate Software, Unify Software and Solutions GmbH & Co. KG., Upwork, Veeva Systems Inc., Verizon Connect, Visma, Vonage, WEX Health, Workiva, Xero, Zendesk, Zoho Corp., Zoom Video Communications, Zuora, and many others.
Custom data cuts related to the Cloud Applications market are available:
- Top 200 Cloud Applications Vendors and Market Forecast 2019-2024
- 2019 Cloud Applications Market By Industry (21 Verticals)
- 2019 Cloud Applications Market By Functional Market (16 Markets)
- 2019 Cloud Applications Market By Country (USA + 45 countries)
- 2019 Cloud Applications Market By Region (Americas, EMEA, APAC)
- 2019 Cloud Applications Market By Revenue Type (License, Services, Hardware, Support and Maintenance, Cloud)
- 2019 Cloud Applications Market By Customer Size (revenue, employee count, asset)
- 2019 Cloud Applications Market By Channel (Direct vs Direct)
- 2019 Cloud Applications Market By Product
Exhibit 4 shows the enterprise applications market by functional area. The highest growth functional markets revolve around smaller segments like Analytics and BI, Collaboration, eCommerce, PPM and TRM, where first movers remain less established than those that for decades have been entrenched in functional areas like Content Management and CRM.
Cloud Win/Loss Analysis As Part Of Enterprise Applications Buyer Insight Customer Database
On the buyer side, customers are investing in Cloud systems based on new features and capabilities that are expected to replace their existing legacy systems. In many cases, competitive upgrades and replacements that could have a profound impact on future market-share changes will become more widespread.
Since 2010, our global team of researchers have been studying the patterns of the latest Cloud software purchases by customers around the world, aggregating massive amounts of data points that form the basis of our forecast assumptions and perhaps the rise and fall of certain vendors and their products on a quarterly basis.
Updated continuously, our database features extensive win/loss analysis. Each year our research team identifies tens of thousands of these customer wins and losses from public and proprietary sources.
The research results are being incorporated into regular updates in our Enterprise Applications Buyer Insight Customer Database. You can access the Quarterly Win/Loss Analysis Scoreboard and our Enterprise Applications Buyer Insight Customer Database by becoming a subscriber.
List of Cloud Software Customers
Source: Apps Run The World, January 2020
An expanded version of this report covers the top 500+ ERP Financial Management Software Vendors and ERP Services and Operations Management Software Vendors , offering in-depth analysis of the market dynamics, vendors’ Strengths, Customers, Opportunities, Risks and Ecosystems as well as their ability to gain Shares (SCORES) within their respective space.
We also offer win-loss analysis of the quarterly wins of these top vendors and whether incumbents and upstarts pose any real threat to their standing amid shifting market requirements and user preferences.
More Enterprise Applications Research Findings
Based on the latest annual survey of 3,000+ enterprise software vendors, Apps Run The World is releasing a number of dedicated reports, which profile the world’s 500 largest Enterprise Applications Vendors (Apps Top 500) and the world’s 500 largest Cloud Applications Vendors (Cloud Top 500) ranked by their 2015-2019 product revenues.
Their 2019xer results are being broken down, sorted and ranked across 16 functional areas(from Analytics to Treasury and Risk Management) and by 21 vertical industries(from Aerospace to Utility), as shown in our Taxonomy. Further breakdowns by subvertical, country, company size, etc. are available as custom data cuts per special request.
Each year our global team of researchers conduct an annual survey of thousands of enterprise software vendors by contacting them directly on their latest quarterly and annual revenues by country, functional area, and vertical market.
We supplement their written responses with our own primary research to determine quarterly and yearly growth rates, In addition to customer wins to ascertain whether these are net new purchases or expansions of existing implementations.
Another dimension of our proactive research process is through continuous improvement of our customer database, which stores more than one million records on the enterprise software landscape of over 100,000 organizations around the world.
The database provides customer insight and contextual information on what types of enterprise software systems and other relevant technologies are they running and their propensity to invest further with their current or new suppliers as part of their overall IT transformation projects to stay competitive, fend off threats from disruptive forces, or comply with internal mandates to improve overall enterprise efficiency.
The result is a combination of supply-side data and demand-generation customer insight that allows our clients to better position themselves in anticipation of the next wave that will reshape the enterprise software marketplace for years to come.