Software As A Service Market Key Players, Revenue And Growth Rate

The global software as a service (SaaS) market size was valued at USD 261.15 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 13.7% from 2023 to 2030. SaaS is a cloud service that provides software applications virtually through Internet. Rising adoption of public cloud services across enterprises is one of the major factors that propel the market growth. The growing shift of enterprises towards SaaS from an on-premises model owing to high cost of on-premises software deployment is further projected to propel the market growth. However, concerns related to data privacy and security related to public cloud is projected to hinder market growth.

Significant increase in the adoption of emails, instant messaging applications, and video calls encourages demand for smart devices among end-users and is projected to contribute to the growth of SaaS market. Furthermore, adoption of CRM SaaS solutions continues to rise as businesses seek to reduce their IT costs and improve scalability. Customization and configuration of CRM SaaS solutions are becoming easier and more accessible, allowing businesses to tailor their CRM systems to their specific needs, such as security.

Gather more insights about the market drivers, restrains and growth of the Software As A Service Market

Detailed Segmentation:

Market Dynamics

Mobile devices are now capable of running more sophisticated software applications, increasing demand for SaaS solutions that can be accessed from any device with an internet connection. Modern tablets and smartphones are equipped with relatively powerful embedded processors, which allow processing on the device itself. This processing power is used for various applications, from running complex software applications and games to processing high-resolution images and videos and executing artificial intelligence and machine learning algorithms. Since 2020, COVID-19 has sped up the development of distant online labor, creating enormous digital needs across multiple horizontal SaaS sectors, including education, retail e-commerce, online supply chain management, office automation, and electronic contracts.

Component Insights

Software segment led the market in 2022 and accounted for a total revenue share of more than 84%. The pandemic has accelerated trends in remote work and flexible work arrangements, leading to a shift in employee expectations. As a result, many businesses are adopting SaaS solutions to enable remote collaboration, productivity, and communication. It includes tools for project management, video conferencing, and cloud storage. Additionally, there is a growing demand for SaaS solutions that offer automation and AI-powered insights to optimize workflows and increase efficiency. As digital transformation continues to accelerate across industries, businesses increasingly rely on data to expedite their operations and gain a better understanding of their customers or users. It has led to growing investment in analytics-driven SaaS solutions.

Deployment Insights

Private cloud segment held the largest revenue share of over 43% in 2022. Combining the deployment of SaaS applications at the network's edge with a private cloud infrastructure can provide organizations with greater control and security over their data while improving performance and reducing latency. Additionally, organizations can maintain greater control over their data by using a private cloud infrastructure, ensuring compliance with regulatory requirements, and mitigating risk of data breaches. Overall, combining edge computing with private cloud can provide a powerful platform for delivering SaaS applications that meet the needs of modern businesses.

Enterprise-size Insights

Large enterprises segment led the market in 2022, accounting for over 60% share of the global revenue. SaaS solutions offer large enterprises several benefits, including cost-effectiveness, scalability, and flexibility. A trend seen in large enterprises is adopting multi-cloud and hybrid-cloud strategies, driven by the need to manage complex distributed application environments that span multiple geographies, data centers, and cloud providers. Another trend observed among large enterprises is the adoption of platform-as-a-service (PaaS) solutions. PaaS solutions provide a higher level of abstraction than SaaS solutions, allowing enterprises to focus on application development and deployment rather than managing the underlying infrastructure.

Application Insights

Others segment held the largest revenue share of over 42% in 2022. Others segment include supply chain management, security as a service, AI as a service, IoT as a service, edge computing, unified communications as a service, and operations management. Emergence of new technologies like robotic process automation (RPA), cloud computing, and artificial intelligence (AI) can potentially revolutionize supply chain software market. AI has the potential to transform supply chain management by providing real-time insights into inventory levels, demand forecasting, and delivery schedules.

Industry Insights

Others segment led the market in 2022, accounting for over 38% share of the global revenue. The other segment includes automobile and media & entertainment industries. Further, BFSI segment accounted for over 24% share of the global revenue owing to the significant transformation in the sector, with new technologies and digital platforms disrupting traditional business models. Additionally, cloud-based core banking solutions are becoming increasingly popular as they offer greater flexibility and scalability than traditional on-premises solutions. These tools allow financial institutions to quickly adapt to changing market conditions, scale up or down as needed, and reduce costs.

Regional Insights

North America dominated the market in 2022, accounting for over 44% share of the global revenue. The U.S. is positively contributing to the growth of market revenue. Presence of well-established market players is one of the driving factors for market growth. Moreover, developed IT infrastructure increases easy deployment of cloud-based virtual services in the region, further contributing to a significant share in the global software as a service (SaaS) market. Moreover, significant expenditure on cloud infrastructure and availability of many secured internet servers further contributed to the highest market share.

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Key Companies & Market Share Insights

Key market players tend to launch new strategies more frequently in order to stay head-on in the market. Moreover, companies are focusing on increasing investments in the advancement of cloud services to increase customer base in the market. Moreover, major players are targeting new regions and geographies to increase their revenue from the industry, by either entering new market solely or by collaborating with local companies worldwide.

Some of the prominent players in the global software as a service (SaaS) market include:

• Adobe Inc.

• Microsoft

• Alibaba Cloud

• IBM

• Google LLC

• Salesforce, Inc.

• Oracle

• SAP SE

• Rackspace Technology, Inc.

• VMware Inc.

• IONOS Cloud Inc.