Software as a Service Market is expected to reach US$ 462.94 billion by 2028

PRESS RELEASE BY The Insight Partners 26 Dec 2022

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The software as a service market is expected to reach at US$ 462.94 billion by 2028; registering at a CAGR of 18.5% from 2022 to 2028, according to a new research study conducted by The Insight Partners. 

Shift from Independent Software Vendors (ISVs) to SaaS Model to Provide Growth Opportunities for Software as a Service Market Growth During 2022–2028

The SaaS model has proved to be a boon for organizations. However, at the same time, it has affected the businesses of independent software vendors (ISVs). With their solutions becoming obsolete, they quickly need to find a way to attract customers. Re-engineering their products is also more challenging; hence, they are reluctant to adopt SaaS models. Their clients use their core solutions which have been built over the years. They either have multiple products assimilated inorganically or a list of products that have been established by different teams. The skills to re-engineer these products are found rarely, which is hampering the ISVs’ ability to remain competitive. An ISV generally would take 18 or 36 months to re-engineer, and considering today's business scenario, this time frame is highly unacceptable. The time frame to re-engineer the package takes the ISV out of the competition completely. These factors are creating lucrative business opportunities to software as a service market players.

Software as a Service Market ­– by Region, 2022Software as a Service Market ­– by Region, 2022

Software as a Service Market Size and Forecasts (2021 - 2031), Global and Regional Share, Trends, and Growth Opportunity Analysis

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Software as a Service Market Size and Forecasts (2021 - 2031), Global and Regional Share, Trends, and Growth Opportunity Analysis Report Coverage: By Deployment Model (Private Cloud, Public Cloud, and Hybrid Cloud), Applications [Customer Relationship Management (CRM), Enterprise Resource Planning (ERP), Human Resource Planning (HRP), Supply Chain Management (SCM), and Others], and End User [Small & Medium Enterprises (SMEs) and Large Enterprises], and Geography (North America, Europe, Asia Pacific, and South and Central America)

Source: The Insight Partners Analysis

SaaS is an advanced and innovative way for small businesses to acquire software. Through software as a service adoption across small and medium enterprises, entrepreneurs are able to reduce their additional software cost, Thus, the growing number of SMEs across countries such as Mexico, India, and Brazil is expected to fuel the demand for SaaS, contributing to the software as a service market growth.

The pandemic positively impacted the software as a service market size. To combat the rapid spread of the virus, industries across the globe increased their digital technology adoption to carry out business operations smoothly. Both SMEs and large enterprises adopted complete software suites over individual solutions for cost-effectiveness and easy integration. Moreover, the labor shortage across industries increased the adoption of advanced solutions across enterprises. These factors positively impacted the managed security services market size during the pandemic.

As the world is becoming increasingly competitive, organizations seek a paradigm shift in the methods being followed to make themselves competitive. With the rise in population worldwide and the change in lifestyles in developing countries, particularly in APAC, businesses have evolved into totally different forms. The outlook has changed on how business was done in the earlier days and perceived. Analytics and automation have become mandatory for almost all businesses and successfully integrated with businesses worldwide. For analytics, a huge amount of data is being generated. Also, the new technology of Big Data requires a huge amount of data and eventually storage spaces. Small organizations venturing into new businesses cannot invest heavily in storage spaces. Even if they keep such huge investments only in storage spaces, they would not be able to invest in their products. Break-even time would also have a bearing on the profitability of the organization. This is where the need for a shared infrastructure for data storage, management, and maintenance arises. The SaaS model is a kind of shared infrastructure wherein such small organizations just pay for the on-demand use of the software and need not store any data or purchase the software. This provides smaller organizations with a good opportunity cost. These factors are expected to offer lucrative business opportunities to software as a service market players over the forecast period.

The major software as a service market players operating across the globe include ADP LLC, Inc, Google Inc, IBM Corporation, Microsoft Corporation, Oracle Corporation, Inc, SAP SE, Fujitsu Limited, and Workday Inc.

  • In 2022, Sygitech Cloud Solutions announced the launch of its two products—SygiOps and SygiCloudSync. The solutions are designed to automate IT workers’ daily routine tasks to reduce their burden and time taken for the same.
  • In 2022, Xerox deployed Oracle Corporation’s cloud platform to launch a new business focused on problem-solving on a massive scale.

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