Creative Market Sizing 101

I believe that market sizing surveys and reports have a value. In a competitive world, it is good to make benchmarks in terms of what your rivals are up to – how well they’re performing, etc.

But some market estimates make no sense to me. Merrill Lynch recently put together a market report stating that it believes the Cloud Computing market (whatever that is) could be a $100 billion market in the next few years.

Awesome.

But, what exactly constitutes this market? Merrill put together a chart, which makes very little business sense to me in terms of a competitive market analysis (or any type of analysis):

wtf?

So, how does anyone involved in this chart get ranked, learn about competitors – or for that matter even learn who is a competitor or potential partner?

The Cloud Computing, for lack of a better term, market is still very nascent, and I don’t think anyone has a true grasp on what it really means to be a player in this space. And by simply adding up revenues of existing players who have had their CEO rant about “the Cloud” does not make up a market segment.

Working for a company that competes with at least two vendors mentioned on this slide, I’ve learned nothing about my market segment. Does SugarCRM have aspects that make it a cloud computing player?  Of course. But, SugarCRM is still dedicated to providing great applications – regardless of deployment model – to our core customers. We are not treating anyone like second-class citizens as we chase the nest buzzword in order to stay a Street favorite.