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The global device as a service market size was valued at USD 22.22 billion in 2022 and is projected to grow from USD 27.62 billion in 2023 to USD 154.93 billion by 2030, exhibiting a CAGR of 27.9% during the forecast period. North America Held the Dominant Share to Drive the Market Growth.
Device as a service is the offering of management services and IT equipment, such as computers, smartphones, and mobile devices, in a paid subscription. It provides a cost-effective subscription-based service that enables organizations to deploy their remote teams with the devices they need. Businesses can reduce capital costs while simultaneously providing the correct infrastructure to meet their needs as they evolve by selecting this model.
The device as a service market growth can be witnessed due to an increasing demand for a subscription-based model, which enables users to move from the capital expenditure model to an operating expense model. Market growth is also expected to be stimulated by an increase in the number of channel partners offering this service. It allows organizations to reduce the overall IT burden and helps prevent technological constraints, which, in turn, leads to productivity growth. It also facilitates timely software updates and maintenance of hardware. Additionally, reduction in IT support spending, increased user productivity, and the growing need for cost-effective and secured devices have accelerated market growth.
Rising Digital Penetration and Increasing Demand for IT Hardware Devices during COVID-19 Pandemic to Fuel Market Growth
The COVID-19 pandemic has caused the market to grow significantly owing to the rise in digital penetration, increasing remote work, and work from home policies. Device as a service has been widely regarded as an IT cost savings measure for organizations. The pandemic has posed an easy and compelling need for organizations to continue working but with staff in their homes by relying on several devices.
A sudden increase in demand for laptops and other IT hardware devices has occurred, with a growing number of companies choosing to work from home, following the COVID-19 outbreak. Providers have started to offer such services at scale, enabling hybrid working models to meet the growing demand for IT hardware. Due to such factors during the COVID-19 pandemic, there has been an enormous need for device as a service offering.
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Increasing Demand for Work Flexibility is a Key Trend
Organizations need to manage their workforce efficiently to increase productivity and job satisfaction. Therefore, it uses a variety of working models, including a hybrid working model. There are several benefits for workers, businesses, and the environment in switching to a hybrid working model. This increases the flexibility of employees, productivity, and job satisfaction. For organizations, it decreases the renting cost and maintenance charges of office space and grows the talent pool. Thus, the rising demand for work flexibility is increasing the use of device as a service offering.
This flexibility could be beneficial for companies that need to rapidly increase or decrease the number of staff in response to changes in market conditions. According to a survey by Lenovo in 2022, 82% of IT leaders want to work with technology that upholds the workplace's new values. These trends are contributing to the growth of the market in combination with growing consumer spending on smartphones and digitalization.
Rapid Adoption of Subscription-based Models in Device as a Service to Aid Market Growth
The market is driven by the rapid uptake of subscription-based services. Subscription-based Device as a Service (DaaS) model provides customers to transform high technology costs into operating expenses (OpEx). For revenue driving strategies, cash can be freed up for SMEs, midsized, and large enterprises. Furthermore, additional benefits can be gained, such as compliance with regulatory requirements, access to installation, latest technologies, device configuration, data migration, onsite support, and technology recycling.
As a subscription model, it provides an organization to scale up or down according to its operational and environmental business needs. Companies can pay according to their requirements. Additionally, market growth is expected to increase as a result of connectivity needs in IT hardware devices, creating a demand in the market.
System Integration and Compliance Issues to Hamper Market Growth
The integration of new software systems into the IT infrastructure can be a difficult task for companies. A high volume of data transfer takes a lot of time for system integration, creating a major challenge for the providers. The DaaS offering could restrict the number of tools that can be used so that users can choose to use tools hosted on the platform.
Mostly where sensitive data is moved to the cloud environment, some organizations also encounter issues of compliance. As a result, issues related to system integration and compliances could hamper growth during the forecast period.
Operational Flexibility of DaaS Offerings to Increase the Demand for Services
By offering, the market is bifurcated into services and hardware. The services segment is expected to grow at a higher CAGR over the forecast period. These services constitute a set of device life cycle services, which include deployment & integration, installation, asset recovery, maintenance, and repair. These services are often flexible and can be optimized and tailored. Several service providers and value-added resellers have benefited from the increasing demand for services in this market, which has also encouraged them to partner with hardware manufacturers. Moreover, the seamless operation of an enterprise is ensured through continued support and services for electronic equipment that offers end users flexibility.
In terms of market share, hardware dominated the market in 2022. This is attributed to a growing interest among enterprises in various types of hardware solutions, such as desktops, laptops, notebooks, and others combined into one offering.
Cost Effective Subscription Based Models for SMEs to Aid Market Expansion
Based on enterprise type, the market is segmented into large enterprises and Small & Medium Enterprises (SMEs). Small & Medium Enterprises (SMEs) segment is expected to significantly grow at a higher CAGR during the forecast period owing to the cost-effective device as a service subscription based models.
SMEs have a wide range of tasks such as maintaining inventory and avoiding cyber-attacks. Moreover, the cost and flexibility benefits made available to SMEs justify their preference for operating expense business models over capital expenditure. Also, startups are getting funding for technological advancements in this market. For instance, in April 2022, Fleet received a series A funding of USD 20.0 million to enable the management of devices.
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Rising Demand for IT Hardware Devices in IT and Telecommunications to Grow Market Share
By end-user, the market is classified into BFSI, education, healthcare and life sciences, IT and telecommunications, government and public, and others that are adopting device as a service models for enhancing their business activities. Among these, the IT and telecommunication segment dominated the market in 2022. This sector generates the greatest demand for devices, such as laptops, smartphones, desktops, tablets, and other peripherals, as security, reliability, and excellent performance of IT equipment are vital to essential operations. To reduce investment in IT infrastructure, there is an increasing awareness of the DaaS model and its advantages as well as a preference shift toward OpEx models.
Furthermore, the continuous updating of software and related services is relatively high, which has also led to the adoption of the model in this market.
North America Device as a Service Market Size, 2022 (USD Billion)
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Regionally, this market is fragmented into South America, North America, Europe, Asia Pacific, and the Middle East & Africa.
As per the analysis, North America held a major device as a service market share in 2022 due to the presence of large players in countries such as the U.S., Canada, and Mexico, where new technologies have been adopted rapidly. The regional market is also feasible in terms of government rules and regulations for SMEs and large enterprises. The growth of the market is also expected to be supported by increasing demand from IT and telecommunications, as well as growing demand in several industry sectors for IT hardware. Furthermore, business expansions in the region are expected to help gain traction for this market. For instance,
Due to the growing demand for startups and increasing internet penetration, Europe is also expected to be experiencing reasonable demand in the market. In September 2022, Everphone announced a USD 35.0 million expansion of its Series C funding.
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The Asia Pacific is projected to grow at a higher pace, with the trend expected to continue over the forecast period. The demand for DaaS is expected to increase due to the presence of large workforces and many industries in IT and telecommunications. Also, regional market growth can be expected to benefit from cost-effective subscription rates and sustained growth of several sectors within certain countries such as China, India, and Japan.
Market Players Engage in Merger & Acquisition, Collaboration, and Product Development Strategies to Expand Reach
Prominent players in the global market aim to support more users and enable more devices to run on the platform by switching to a subscription-based model. They focus on acquiring small and local firms to increase their business presence. Further, merger & acquisitions, strategic partnerships, and leading investments in device technologies help boost the market growth.
An Infographic Representation of Device as a Service Market
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The report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product/service types, and leading end-users of the product. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to the growth of the market in recent years.
CAGR of 27.9% from 2023 to 2030
Value (USD Billion)
By Offering Enterprise Type, End-User, and Region
By Enterprise Type
The market is projected to reach USD 154.93 billion by 2030.
In 2022, the market value stood at USD 22.22 billion.
The market is projected to grow at a CAGR of 27.9%.
IT and telecommunications segment is likely to lead the market.
Rapid adoption of subscription-based models in the DaaS model aids market growth.
Dell Technologies, Lenovo, HP Development Company, L.P., Microsoft Corporation, CompuCom Systems, Inc., Atea Global Services Ltd., Computacenter plc, RingCentral, Inc, Intel Corporation, and Accenture are the top players in the global market.
North America is expected to hold the largest market share.
Asia Pacific is expected to exhibit the highest growth rate during the forecast period.
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