In the SMB area, which depending on definitions may, for example, include organizations with up to 500-1000 employees, there may be a strong IT department and some of the same issues faced by enterprises may overlap to these smaller organizations.
There is an increasing amount of interest in and focus on the SMB market by major and smaller suppliers. The key distinctive issue is not technical as much as it is a marketing issue. IT firms have historically relied on third party distribution, VARs, system integrators (SIs) and MSPs (managed service providers) to reach these accounts. We see a major opportunity for MSPs in this area, because of their technical experience, customer relationships and management skills.
For SMBs, the Business versus Personal use issue is, perhaps, more likely to be more prevalent than it is for enterprises. Enterprises are more likely to develop defined policies and restrictions about uses of certain types of information and in some cases may provide dedicated device hardware for certain critical functions. In very small SMBs the mixture of personal and business matters is likely to be very common.
There has been a significant amount of attention devoted to the SMB market for cloud services, especially recently, with a number of surveys and other statements being released.
A Microsoft survey of SMBs, with up to 250 employees, released in March 2012 found that:
- 30% were using cloud services to some extent;
- – Another 48% expected to be using them within the next two-to-three years;
A major underlying issue driving cloud acceptance was limited resources of SMBs. The survey found:
- 60% of SMBs don’t have the resources necessary to implement new technologies and services;
- 52% don’t have the resources to get their employees trained.
The survey concluded that:
- The number of very small firms (2-10 employees) using cloud would probably triple in the next three years from about 25% today to 76%;
- Among firms with over 25 employees and up to 250 employees, over 50% were using cloud services today and 85% or more were likely to be using them in three years.
The major prospective benefits of the cloud were rated as cost savings and productivity improvements. While security of data was a primary concern, only 20% stated that they believed data was less secure in the cloud than in their in-house facilities. A further study conducted by ComScore for Microsoft and released in mid-2013 found that SMB concerns over cloud security were declining. While 60% of those not using the cloud still expressed concerns over security, 90% of cloud users among SMBs found that security was increased via the cloud, and a majority of these users also cited other benefits.
Parallels, the virtualization and automation software company, in the past three years or so has put a very heavy emphasis on supporting cloud software and services and particularly in addressing the SMB market for cloud. This was spurred by the perception among many that the early success of cloud initiatives such as Amazon’s AWS did not include heavy penetration of the SMB market.
It is interesting to note that estimates as of 2010, as reflected in a February 2010 Wall Street Journal article were that only slightly over 3% of SMBs were using cloud type services. Parallels has sponsored and issued its own studies of the SMB cloud market in recent years.
The 2012 Parallels study covered a wider range of companies than in the Microsoft study – up to 1000 employees on the high side. It focused on four applications areas:
- IaaS, Infrastrucutre as a service – which included dedicated servers, virtual private servers (VPS), managed hosting, and utility or elastic computing.
- Web presence – which included third-party web hosting, blogging services, domain registration, SSL and e-commerce add-ons, and site-building tools.
- Hosted communication and collaboration – which included business-class e-mail services, including e-mail security, e-mail archiving, and mobility; and hosted phone services, including hosted PBX and voice-over-IP (VoIP).
- Business SaaS, Software as a service – which included content management, e-mail archiving solutions, file sharing, online accounting, online backup and storage, online CRM, payroll and HR, phone conferencing and web conferencing.
The following table reflects selected usage estimates of cloud services, by category, by SMBs, based on the Parallels study.
Parallels – 2012 SMB Cloud Study, Selected Findings
|Category of Cloud Service||% of SMBs Using|
|Web Presence||Websites – 53%|
|Facebook page – 44%|
|Hosted Communication/Collaboration||Premium e-mail – 18%;|
|Hosted PBX – 67% for smallest SMBs, 26-36% for larger ones|
|SaaS||Between 6-41% depending on app|
A 2012 study by Dell of companies with 50-999 employees, found that cloud applications are increasing. Companies that have adopted cloud services plan to add, on average, three more cloud applications in 2012. CRM has been the area of fastest cloud adoption for SMBs. The study found that 69% prefer to purchase cloud solutions from a single, trusted provider.
Integration with existing business apps is a key issue, with 74% using in-house staff for integration work. The Dell sponsored study found that the key benefits of adopting cloud applications cited were: low total cost of ownership, fast deployment time, simplified access from a browser, single sign-on, and automated feature and functionality upgrades