Cisco is expecting strong demand for its software-as-a-service (SaaS) solutions from small and medium businesses (SMBs) in tier-2 and tier-3 cities of India, as internet users rise and the ‘everything-as-a-service’ model gains popularity. Gartner predicts that over 85 percent of organizations will embrace a cloud-first approach by 2025.

According to Cisco’s annual internet report, the Asia Pacific region will have 3.1 billion internet users (72 percent of the region’s population) by 2023, up from 2.1 billion (52percent) in 2018. By 2023, Asia Pacific will have 13.5 billion networked devices/connections, up from 8.6 billion in 2018.

Daisy Chittilapilly, president, Cisco India and SAARC says, “to keep pace with evolving consumer needs, at Cisco, we are catalyzing innovation across areas like cloud-delivered cybersecurity, collaboration, analytics, and data centre. We have demand originating not just from large businesses but also from small businesses and tier-2 and -3 towns.”

Traditional or non-digital native sectors like manufacturing, government, healthcare, logistics, education and agriculture are increasingly embracing technology to improve efficiencies and unlock new value.

“We have seen good traction for our SaaS and networking offerings from these sectors," says Chittilapilly.

Nitish Mittal, partner, Europe Technology Practice, Everest Group says, “a primary reason is that SMBs don’t have a large internal IT team to manage their technology backbone and need integrated as well as easy-to-use solutions which SaaS offers through opex-led models. For instance, Cisco has brought a range of SMB-centred solutions through Cisco Designed, a suite of tools to help SMB clients across network, collaboration, compute, and security.”

“There is tremendous opportunity in the SMB segment but requires careful market selection since the market can be quite fragmented. The primary challenge remains the long tail that the SMB market represents, smaller deal sizes, as well as longer sales cycles to sign and onboard clients," adds Mittal.