The Network as a Service market is poised to rise from $5 billion in 2018 to over $50 billion by 2025, according to a 2019 Global Market Insights report.
Market growth drivers
The market growth is due to rising demand for network virtualization technologies among enterprises to minimize CAPEX & OPEX costs.
These technologies are gaining immense popularity among network operators due to cost-effectiveness. The rise in the number of mobile applications and network endpoints has put tremendous pressure on the traditional network infrastructure.
To meet the enterprise mobility demands and ensure a long network uptime, enterprises are switching toward SDN-enabled NaaS, which help in providing on-demand network services to customers.
The rising trend of the pay-per-use business model will enable customers to pay only for the network or services they avail, leading to Network as a Service market growth. Large as well as small organizations are using this pricing model to benefit from on-demand network resource provisioning to increase the application throughput.
WAN as a Service
The WAN as a Service segment is expected to hold a major share of the NaaS market share of around 30% by 2025 as the enterprises are largely dependent on the WAN infrastructure for connecting their remote employees & devices.
To minimize the costs associated with the management of WAN networks, enterprises are using NaaS offerings. The NaaS model enables them to use or provide network services on a subscription-based pricing model, eliminating the need to rearchitect their networks.
As they are continuously looking for new ways to reduce their networking costs, the demand for cloud network services will increase over the forecast timespan.
SME Network as a Service market
The SME Network as a Service market is projected to exhibit an excellent CAGR of over 35% during the forecast timeline. SMEs use the NaaS model as it provides them with the flexibility to scale up or down the network resources as per their requirements and also promise greater efficiency through an on-demand provisioning model.
The growing needs among SMEs to increase the return on investment and focus on other priorities to generate more revenue will also facilitate NaaS adoption.
The BFSI vertical is estimated to hold the network as a service market share of around 15% by 2025. Driven by the need to manage remote branch sites and deliver better services to customers, the banking & other financial institutions are modernizing their IT infrastructure by investing a huge sum in cloud and networking technologies.
These technologies are enabling them to increase network performance and improve resource availability. To manage multi-channel digital platforms and services and handle a vast amount of financial data, they are using NaaS and cloud-NFV to deliver uninterrupted services.
Asia Pacific NaaS market
The Asia Pacific Network as a Service (NaaS) market is projected to witness the fastest growth rate of over 40% from 2019 to 2025. The market growth is attributed to the increasing deployment of cloud & network virtualization solutions to meet the rising network traffic demands.
In this region, the telecom sector has witnessed an extensive usage of NaaS model due to the growing trend of workforce mobility. The countries including Japan, China, and South Korea will lead other countries in terms of market share due to the widespread deployment of NaaS platforms driven by technologies such as SDN and NFV.