Dive Brief:

• In the last two years, Microsoft Office 365 has steadily grown its foothold in enterprises from around 34% to more than 56%, eclipsing G Suite in deployment by more than twofold in 2018, according to a Bitglass analysis of 135,000 corporate email domains. Google's cloud app suite appears to have plateaued in deployment, hovering at just under 25% adoption since 2016, with similar rates across businesses of all sizes.
• For other cloud apps, adoption increases as a business grows its workforce. Salesforce and Box are more than twice as popular in businesses with more than 1,000 employees than businesses with 500 workers or less. Office 365 and Slack are around 50% more popular between the same categories. 
• Global cloud application adoption has hit a new record at 81%, though the adoption of single-sign on (SSO) solutions has lagged. Only 25% businesses are using SSO solutions for authentication, led by the education, finance and retail sectors. 

Dive Insight:

Security can sometimes take a backseat as strapped IT teams focus on deploying productivity tools without a designated security team in place, according to Salim Hafid, product marketing manager at Bitglass, in an interview with CIO Dive. Over the next year, the adoption of SSO is likely to rise, especially in more regulated industries. 

With more businesses on the cloud and growing adoption of cloud apps, security should become a larger priority for CIOs and CISOs. Customers are quick to trust productivity tools and suites, but protecting access and authentication needs to be built in from the start. 

The market demonstrates that businesses are coalescing around a handful of cloud applications, reinforcing the dominance of Silicon Valley staples like Microsoft and Google, offering large suites of productivity tools. Powerful newcomers like Salesforce and Slack, bring more specialized tools to the table. 

Microsoft, which has revamped its strategy around the enterprise and reorganized its business to prioritize cloud and artificial intelligence, benefits from one of the most diversified product portfolios. The company's OneDrive platform remains the most popular cloud storage and file sharing service.

Larger enterprises lean toward Office 365 for its spate of offerings, and the company's efforts to offer incentives for customers to exchange on-premise solution for the Azure cloud has grown Microsoft's customer base significantly over the last two years, according to Hafid. 

The plateau of Google's suite is rooted in the fact that businesses onboarding the G Suite tend to be really early adopters, according to Hafid. The productivity suite saw a fast rate of growth early on, but now that most businesses that want the cloud are on it, its growth has tapered off. 

Even though they occupy smaller market niches, entrants like Box, Slack and Salesforce are raking in cash and customers and holding their own against Google and Microsoft. Salesforce, the largest of the three, already has its sights set on $20 billion by FY2022.

The rise of all of these players speaks to the demand for simple, flexible and effective business tools delivered through the cloud. It's a market that allows for the rise of many niche players, though giants like Microsoft and Google are looking to consolidate as much of the market as possible in their suites.