The Indian economy will see growing adoption of new-age technologies including artificial intelligence (AI), big data analytics, internet of things (IoT), 5G connectivity, etc., which will drive the cloud market in the country to expand 30 percent annually to reach USD 7.1 billion by 2022, according to a recent report by NASSCOM.
The report mentions that part of the growth of the cloud market will involve the software-as-a-service (SaaS) market, which will grow 36 percent annually to contribute USD 3.3- USD 3.4 billion by 2022. Focusing on the cloud market, this slideshow describes SaaS adoption trends across different sectors of the Indian economy.
The report states that of the total IT spending in the BFSI sector (USD 10 billion), the total spend on cloud itself is quite low, as only 3-4 percent was spent on cloud-based SaaS solutions at the end of 2018. However, with the rise of smart banking, usage of cloud solutions has been growing in the sector to achieve better performance and customer experience. Analytics is another factor driving SaaS adoption in the BFSI sector in India.
Automation in the manufacturing sector has led to an increased scope of deploying cloud-based systems. Such systems have the ability to reduce infrastructure and maintenance costs by about 54 percent, but only 30 percent of manufacturing enterprises are deploying them, according to the report.
India has grown to become the 2nd largest market after US when it comes to e-learning solutions. The Indian e-learning market is estimated to reach USD 1.96 billion by 2021, according to the report. This boom in e-learning provides a great opportunity for SaaS deployments in the sector.
Indian retail outlets have been extensively investing in cloud-based solutions over the passing years, and the cloud spend from the total IT budget has been estimated to be 12 to15 percent. Factors that are pushing cloud-based SaaS in retail sector include centralization of inventory and inter-store fulfillment as a part of improved customer service, according to the report. However, the unorganized sector with over 90 percent of total retail remains an untapped opportunity for SaaS solutions.
Healthcare providers are investing in cloud-based analytics solutions to gain deep insights into patients' health. But, at the same time, out of the total expenditure, a mere 0.5 to 1 percent is spent on healthcare IT due to factors such as security threats, unstable connectivity, legacy systems and devices. Out of that expenditure, the cloud spend is estimated to be a mere 6 to 10 percent.
SaaS for logistics management has been rising constantly in the last few years. Widespread smartphone usage and the rise of app-based SaaS solutions are bringing logistics service providers and customers on a single platform, which is driving adoption. According to the report, large scale digitization across Indian supply chain ecosystem is enhancing the demand for cloud-based SaaS solutions.
Government IT spending has been considerably low with an approximately 2 percent YoY growth, according to Nasscom. But, with the national cloud initiative MeghRaj, government applications and services will be hosted on the cloud and will give a boost to SaaS in cloud computing.
When it comes to internet-enabled companies, SaaS solutions are being used across various functions of an organization. This is being done to satisfy end-to-end customer journey visibility and also the visibility of back-end processes. Iternet-enabled enterprises are leading the adoption of cloud and SaaS, which in turn is driving demand for cloud solutions in other traditional companies.