SaaS Market size to record growth of USD 313.45 billion

• 20 Feb 2024
• TM Team
• 0 Comments

According to Technavio, the global software as a service (SaaS) market size is estimated to grow by USD 313.45 billion from 2022 to 2027. The market is estimated to grow at a CAGR of 19.19% during the forecast period. North America is estimated to contribute 54% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. One of the main factors which are significantly contributing to the growth of the software as a service market in North America is due to the increasing demand for cloud computing services, especially in the US. Additionally, factors such as the availability of technologically advanced infrastructure and the presence of a large number of cloud service providers (CSPs) such as Microsoft, Salesforce, Oracle, and Adobe based in the US are positively impacting the market growth in the region. Furthermore, there is increasing investment by several enterprises in IT to implement enterprise applications in order to streamline their processes. 

The public cloud segment is estimated to witness significant growth during the forecast period. Some of the computing functionalities off public SaaS are complete software programs or applications, which are made available to customers over the Internet. Additionally, it offers IT services over the Internet or through virtualization. As a result, these IT services are provided by third-party providers. Besides SaaS services, several market players are offering IaaS and PaaS services such as bandwidth, network connections, Internet Protocol (IP) addresses, and storage, which allows SaaS solutions to run on the IaaS platform of the companies. The public cloud segment was the largest segment and was valued at USD 94.63 billion in 2017. Additionally, these market players also offer OS platforms or infrastructure, which can be utilized for software testing. Some of the key SaaS solutions that are offered to customers include e-mail, sales management, CRM, financial management, human resource management (HRM), billing, and collaboration. There is increasing use of the public cloud due to its elasticity and scalability, which are ideal for IT-enabled services. Microsoft Office 365 and Slack IPO are some of the prime examples of public cloud solutions. Several market players offer public cloud offer software programs and applications including ERP, CRM, and HRM, which can be used by enterprises. Some of the key advantages of public cloud services are low initial investments, high availability and multi-tenant capabilities, reduced complexity, flexible pricing, and cost agility. 

• One of the key factors driving the software as a service (SaaS) market growth is the augmenting use of mobile apps. There is increasing popularity for mobile apps among businesses and other sectors.
• There is increasing use of mobile apps in e-commerce, payments, food delivery, healthcare, and other purposes due to the rising penetration of smartphones in emerging countries.
• Additionally, there is increasing adoption of digitalization across education sectors which optimizes the teaching and learning processes.

Furthermore, the main advantage of the integration of digitization in the education sector is that it offers students and teachers better access to resources.

• For example, students are able to access study materials on their smartphones, laptops, or tablets anywhere and at any time by leveraging educational apps.
• Additionally, there is an increasing implementation of BYOD policy in various schools in several regions which enables students to use their own devices, such as smartphones, laptops, and tablets, in schools.
• Hence, such factors are expected to positively impact the SaaS market growth. Therefore, it is expected to drive market growth during the forecast period.