According to the study conducted by Astute Analytica, the global Network-as-a-Service (NaaS) market was valued at $15,326.9 million in 2021 and is projected to reach $1,18,709.3 million by 2027. The market is expected to register a CAGR of 40.7% during the forecast period 2022-2027.
Network as a service (NaaS) is a business model for delivering enterprise-wide area network services virtually on a subscription basis. The growing impetus of the Global Network-as-a-Service (NaaS) Market is attributed to increasing adoption of cloud services among enterprises and augmentation in software-defined network (SDN).
Significance of the global NaaS market
Readiness towards the implementation and acceptance of advanced technology, strong research and development in the telecom industry, the surge in the number of cloud-based services and other factors are driving the Network as a Service (NaaS) market. The technology companies and the telecom service providers are embracing cloud platforms to reduce labor costs. Cloud deployment solutions allow enterprises to focus on their core competencies and strategic goals.
With the appropriate use of NaaS offering, organizations can enhance the performance of their cloud applications. Large organizations, as well as SMBs, are rapidly deploying these services to reduce the costs related to the procurement of new devices and IT staff training. Hence, this will foster the deployment of NaaS, eliminating the need to maintain their complex network setup.
The SDN (Software Defined Network) adoption has also been increasing in campus and enterprise segment as the demand for the efficient and flexible networks is high. SDN solutions, in conjunction with Network Function Virtualization (NFV) and open-source technologies, are anticipated to gain traction in the NaaS industry.
Service providers who wish to expand their offerings for enterprise customers need to start looking into NaaS, as those customers seek to respond to dynamic business needs faster, identify additional ways to cut costs and have more control over their network. NaaS provides the solution and elevates the relationship between Communication Service Providers (CSPs) and their customers. CSPs can accelerate their network services transformation and reduce their investment by implementing field-proven technology from advanced software and services providers.
In the present cloud computing scenario, most of the companies are adopting cloud services and allowing access to more remote users and devices compared to the past. Hence, data security and privacy concerns are likely to deter the progression of global network as a service market. Concrete measures for security are the need of the hour.
Impact of COVID-19
COVID-19 and the associated work from home opportunities for workers have caused small businesses to consider network-as-a-service. Cloud technology helps employees access the system and application from home. People staying at home has increased the usage of the internet. This has surged the demand for high-speed network connection.
Moreover, the organizations around the world are preparing for a post-pandemic workplace by investing in networking technologies that support the changing needs of employees and that’s having a profound impact on the network. It appears COVID-19 is the problem NaaS solves.
North America holds the highest market share in 2021
North America is projected to have the highest market share of 40% in the global network-as-a-service market in 2021. In North America, the US majorly contributes to the market growth in the region, with a share of 82.6% in 2021. This is owing to the early adoption of advanced technology solutions as well as prominent initiatives taken by industry players through partnerships with various technology players.
Moreover, the penetration of cloud computing, advanced IT infrastructure, and higher concentration of the network virtualization solution vendors are expected to drive the NaaS adoption in the region. Technology services generates majority of the revenue in the network-as-a-service industry in North America, contributed 57.1% share in the regional market during the forecast period.
UK holds the major share in the European NaaS market
Europe network-as-a-service market holds a modest share of 25.5%, in the global network-as-a-service market in 2021. Moreover, the Europe network-as-a-service industry is mainly driven by IT & telecommunication industry.
Asia Pacific is projected to register the fastest CAGR
China held the major share of in the Asia Pacific network-as-a-service market in 2021. Wide area network services segment contributed the major share of 37.1% in the Asia Pacific market with an increased demand for enhanced mobile services in network-as-a-service.