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Is it the right time to invest in Enterprise Social Networking?

Madura McCormack | Oct. 3, 2012
Global analyst Ovum forecasts market potential of ESN as US$1 billion

"Think seriously about Enterprise Social Networking (ESN) and consider its role within wider enterprise collaboration strategy" is the main takeaway from a new report by Ovum.

Titled 'Enterprise Social Networking: Moving on From a Culture of Collaboration by Email', the report by global analyst firm Ovum aims to steer business in the pro-ESN direction. Ovum asserts that the ESN market is beginning to mature and is transitioning from the introductory phase to a growth phase.

The statement quoted Microsoft's US$1.2 billion purchase of freemium ESN service Yammer as an example of strategic acquisitions being made by startups and vendors.

"We believe the current value of the enterprise social networking market to be in excess of US$500 million," said Ovum analyst and report author Richard Edwards.

However from a market perspective, investment in ESN has yet to be proven to business sceptics and is thus still in the adopter phase with 10 percent of organisations in established IT markets deploying solutions or subscribing to ESN services.

"Ovum believes that the business potential offered by enterprise social networking will only be unlocked when necessity dictates a business change," Edwards added.

According to Ovum, the marketplace is ripe with social software from a plethora of different sources.

Edwards concludes that, "Merger and acquisition activity has increased markedly in the past few months, and this has led to new entrants appearing on the enterprise collaboration landscape. So, with a market potential of at least US$10 billion, the enterprise social networking market is the new battleground for all enterprise collaboration vendors".


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