Enterprise Social Software Spending to Reach $4.5 billion, Says IDC
In recent years, many business organizations have adopted collaborative technology to facilitate effective communication among employees and with customers. According to an article on PCWorld, a survey conducted by International Data Corporation (IDC) forecasts strong growth in enterprise social software spending in the coming years.
IDC expects a 42.4% compound annual growth rate in spending for enterprise social software between 2011 and 2016. Around the world, organizations spent $767.4 million on collaborative technology in 2011. These figures are expected to rise to $4.5 billion by 2016. "We're seeing good strong growth from the major players in this market and that'll continue for quite a while," said Michael Fauscette, the author of two IDC reports regarding enterprise social software, which were released in recent weeks. As a greater number of organizations realize the benefits of using this technology, these figures are expected to rise even higher.
According to Fauscette, collaborative technology is an effective way of facilitating employee communication, which is why an increasing number of organizations are spending big on this technology. Organizations support this type of employee communication because it can prove vital in increasing collaboration and ultimately, productivity and business value.
Enterprise social software provides various modes of communication for its users on a single platform. Several vendor platforms feature discussion forums, employee profiles, content tagging, wikis, microblogging, rating, reviewing, and other features adapted from existing public social media outlets. Organizations acknowledge the benefits of enterprise technology, which is why the demand for enterprise social software is rising. Moreover, employees feel comfortable using enterprise platforms because they are similar to common platforms they use outside their workplace, and because of this, the adoption and use rates might be higher than those for other technology tools introduced by the IT department. These factors contribute to the rapid rise in enterprise social software spending and growing popularity of collaborative technology in the corporate sector where organizations are bound to spend big in hopes that this trend of increased collaboration will translate into innovation, growth, and profits for their organization.
Significance for Midsize Businesses
Software giant Microsoft is set to compete with IBM, Jive, Salesforce, and other vendors in the competitive market of enterprise technology through its purchase of Yammer. According to a recent Midsize Insider report, Microsoft is in talks to acquire the social enterprise company Yammer for about $1.2 billion. Google is also developing a workplace version of its social networking site, Google+. The growing enterprise social software demand will further fuel interests from other vendors, who want to benefit from this collaborative technology trend.
For midsize businesses, limited resources are typically a concern, and when it comes to adopting new technology, costs might be an objection. However, as more vendors such as Microsoft and Google join the growing market, more competition should bring about lower pricing, more innovative features, and better quality and return on investment. In fact, both Yammer and Chatter by Salesforce already have free basic options with limited features and no administrative control. If popular social networks such as Facebook and Twitter are any indication, a day could come when enterprise social software is free even with premium features.
This post was written as part of the IBM for Midsize Business program, which provides midsize businesses with the tools, expertise and solutions they need to become engines of a smarter planet. Like us on Facebook. Follow us on Twitter.