Weather Report: Enterprise Email Partly Cloudy By 2020

September 26, 2011 Timothy Prickett Morgan

Companies are as addicted to their email as their end users are. But corporations are going to give serious consideration to moving their email out there on the cloud.

That is the word from on high from Gartner, who says that cloud-based email only makes up about 3 or 4 percent of the market (presumably counting seats) at enterprises with more than 5,000 seats, the company expects cloud email to be 20 percent of the market as 2016 comes to a close and 55 percent by the end of 2020. It is worth noting that Google currently has about half of the current cloud-based email market among enterprises. (This presumably does not count hosting email in a more traditional way, and it is very likely that Google’s market share among SMBs is even higher, but Gartner did not get into that.)

“The road to its enterprise enlightenment has been long and bumpy, but Gmail should now be considered a mainstream cloud email supplier,” said Matthew Cain, research vice president at Gartner, in a statement, adding that Novell‘s GroupWise and IBM‘s Notes/Domino have all lost momentum, Cisco Systems shut down its cloud email, and Zimbra was spun out of Yahoo and eaten by server virtualization juggernaut VMware, which is trying to position it in the enterprise alongside its infrastructure and platform cloud offerings as well as its desktop virtualization and application virtualization technologies. (In that world, as in that of the iPad, everything is a service.) Cain says that Google Enterprise’s Gmail is a “viable alternative” to Microsoft‘s Exchange Online for big companies.

“Email is not a commodity, and cloud email is still maturing,” Cain said. “We believe that, for most organizations, performing one more on-premises upgrade, which will take an organization through 2014, is the most prudent approach. A less-risky approach to cloud email is via a hybrid deployment, where some mailboxes live in the cloud and some are located on premises. This hybrid model plays to Microsoft’s strengths given its vast dominance of the on-premises email market.”