Worldwide software as a service (SaaS) revenue is on pace to reach $ 12.1 billion in 2011, a 20.7 per cent increase from $ 10 billion in 2010, according to technology researcher Gartner Inc.

The North American region is forecast to account for 63.6 per cent of worldwide SaaS revenue in 2011. By the end of 2015, North America's share will represent 60.8 per cent of worldwide SaaS revenue, Gartner said.

"Increasing familiarity with the model, continued oversight on IT budgets, and the growth of platform as a service (PaaS) developer communities and interest in cloud computing are now driving adoption forward," Research Director at Gartner Sharon Mertz said.

"Usage varies within markets, regions and countries, and the reasons for adopting SaaS vary by region. Total cost of ownership (TCO) is a primary driver in Europe, Middle East and Africa (EMEA), while ease and speed of deployment is the key reason for choosing SaaS in Asia/Pacific and North America," it added.

The top issues encountered when deploying SaaS also vary by region. Limited flexibility of customisation is a top issue in EMEA, while limited integration to existing systems is the primary reason in North America and Asia/Pacific.

North America, specifically the US, represents the largest opportunity for SaaS, and it is the most mature of the regional markets. SaaS revenue in North America is projected to total $ 7.7 billion in 2011, an increase of 18.7 per cent from 2010 revenue of $ 6.5 billion.

North American SaaS revenue is forecast to reach $ 12.9 billion in 2015.

SaaS revenue in Asia/Pacific is forecast to reach $ 768.3 million in 2011, an increase of 27.7 per cent from $ 601.8 million in 2010.

By the end of 2015, SaaS revenue in Asia/Pacific would reach $ 1.7 billion, Gartner said.