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Story URL: http://www.silicon.com/research/specialreports/sme/0,3800004380,39161441,00.htm

In-demand on-demand boosts CRM
Human capital management also a cash cow right now...

By Dawn Kawamoto

Published: Wednesday 16 August 2006

The worldwide CRM market grew to $11.7bn in 2005 – this represents and eight per cent year-on-year increase which is being attributed to a major boost from hosted-CRM subscriptions which could see this year's figure hit $12.9bn, according to AMR.

The software-as-a-service-model which is revolutionising CRM, largely due to the efforts of Salesforce.com, grew 60 per cent last year.

The AMR reported said: "Although market consolidation of CRM suite vendors continued in 2005, the overall customer management market still grew eight per cent in 2005. Hosted revenue... continued to act as the catalyst, with 60 per cent growth in 2005."

Salesforce.com, a pioneer in the hosted CRM market, saw its market ranking rise to sixth place last year from 12th. SAP continued its CRM lead in 2005, its second consecutive year in that spot, while Oracle rose to the third spot from sixth place, largely due to its PeopleSoft acquisition.

Another boom area is the market for human capital management (HCM) applications, which are designed to help streamline human resources operations - generating $5.5bn in sales last year, a 12 per cent year-on-year increase. In 2006, the HCM industry is expected to grow 10 per cent, to $6bn, according to AMR.

Oracle is riding the wave of growth in HCM applications and led the market last year. Its PeopleSoft acquisition helped propel Oracle to top spot.

Rival SAP, however, was not far behind. AMR notes that Oracle's top ranking may be short-lived as the company lays out its migration plans for PeopleSoft customers.

Dawn Kawamoto writes for News.com