Network as a Service Market Size, Share & COVID-19 Impact Analysis, By Type (WAN as a Service, LAN as a Service), By Enterprise Size (Small and Medium-sized Enterprise, Large Enterprise), By Application (Wide Area Network, Virtual Private Network, Cloud-Based Services, Bandwidth on Demand, Others (Integrated Network Security as a Service), By End-user (BFSI, IT & Telecommunication, Manufacturing, Healthcare, Retail, Others), and Regional Forecast, 2022-2029

The global network as a service market size was valued at USD 9.58 billion in 2021 and is projected to grow from USD 11.64 billion in 2022 to USD 80.73 billion in 2029, exhibiting a CAGR of 31.9% during the forecast period. Based on our analysis, the global market exhibited a higher growth of 15.6% in 2020 as compared to 2019. The global COVID-19 pandemic has been unprecedented and staggering, with network as a service experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels.

Leading market players such as Cisco Systems, Inc., providing solutions such as network security, software-defined WAN, and secure web gateway are included in the scope of the report. Verizon Wireless Inc. provides private IP, Managed SD-WAN, and others.

The rising adoption of cloud technology among various sectors such as BFSI and IT & telecommunication is propelling the market forward. This technology includes software-defined networking, Network Function Virtualization (NFV), and Bandwidth on Demand (BoD).

• In September 2021, IBM Corporation collaborated with Telefonica to upgrade Telefonica's 5G core network platform developed with IBM Cloud Pak for Network Automation, Red Hat OpenShift, and Juniper Networking.

COVID-19 IMPACT

Growing Adoption of Network-as-a-Service across Key Industries to Support Growth during Pandemic

The global impact of COVID-19 has positively impacted the network as a service market growth as many firms adopted a remote workplace strategy during the pandemic. As a result, firewall and VPN utilization have improved for ease of use and convenience in network management. For instance, according to the hybrid workplace report 2020, 74% of organizations maintain and increase their investment in SD-Branch, SD-WAN, and 83% of firms will increase their investment in cloud-based networking.

Nearly all organizations adopted the work-from-home model amid the pandemic. For instance:

• A 2021 survey by talent Works showed that more than 90% of senior executives planned remote working across the U.S.


• According to a workforce happiness index survey conducted in May 2020, people working from home scored 75 out of 100 as opposed to 71 workers operating from office.

Additionally, during COVID-19, retailers used NaaS to reduce network capacity in physical locations. While boosting network capacity for online operations, they effectively minimized network capacity in physical locations. To offer a stable, high-performance, and efficient network experience, these retailers can manage the number of corporate locations and consumers, bandwidth requirements from each platform and application, and application use per person employed.

LATEST TRENDS

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Rising Adoption of Networking Technologies by SMEs & Large-Scale Organizations to Bolster Market Growth

NaaS markets companies are rapidly showing massive demand from the large, small, and medium enterprises scale as per requirements to empower remote workers with networking technologies. The expansion toward subscription-based payment systems, on-demand network services, and lower capital investment has given rise to developing economic market potential in the industry. The cloud-based economic model delivers a network as a service (NaaS) over the internet.

NaaS offers extended and flexible services, including Virtual Private Network (VPN), Bandwidth on Demand (BoD), Wide Area Networking (WAN), custom routing, content monitoring and filtering, multicast protocols, security services, and other applications. Furthermore, several end-user industry players in the healthcare, manufacturing, and retail sectors are deploying networks as a service to automate their business processes. For instance,

• In February 2021, Verizon Business expanded its long-standing strategic collaboration with Cisco System, Inc. to include three SD-WAN managed services options. As a result of this expansion, corporate enterprises get a global presence, access to new solutions and skills, and a cutting-edge management and policy administration approach to improve organizational outcomes.

 DRIVING FACTORS

Increasing Inclination Toward Cloud technology to Drive Market Growth

Increasing investments and collaborations in cloud computing, network virtualization, and Software-Defined Networking (SDN) by the leading market players for automating networking services aid the market growth. For instance,

• In March 2021, SDx Networks and Masergy Communications Inc. partnered to launch Australia's next generation of ICT managed service providers. This partnership offers cloud networking in New Zealand, Asia Pacific, and Australia.

SMEs and large corporations are increasingly adopting cloud-based services. They are more cost-effective than keeping an on-premises data center and a costly IT resource to manage the organization's whole network.

Furthermore, corporations need a network that allows them to have on-demand access to their infrastructures, apps, and other IT resources. As a result, the virtual resource-sharing framework's adoption has accelerated. Corporations use NaaS components to turn physical networking elements into shareable virtual resources for data center connectivity needs. The majority of businesses are attempting to centralize their operations and consolidate data from different sites in multi-tenant premises. As a result, organizations migrate to cloud-based platforms to conduct their operations.

RESTRAINING FACTORS

Lack of Standardization and High Cost of Implementation Hinders Market Growth

The complexity in maintaining correct regulatory compliance while providing NaaS services to clients and high cost of implementation is a big concern in the market. Vendors may find it challenging to maintain and protect their technology and comply with specific regulations and legislation at a certain point. Non-compliance with rules and standards by vendors can directly impact the services they provide to clients and put the clients' economic and corporate processes at risk. They prioritize and offer programs and services by following established standards and best service-delivery practices. As technology shifts, vendors find it challenging to constantly update technology and government requirements.

SEGMENTATION

By Type Analysis

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Rising demand for WAN connectivity Solutions is Strengthening Market Growth

Based on type, the market share is bifurcated into WAN as a Service and LAN as a Service.

Among these, WAN as a Service will hold the dominant market share owing to the widespread use of WAN solutions across enterprises in various industries. It develops a communication network using multiple resources such as mobile phones, computers, remote offices, and data centers. Depending on customer needs, WAN connectivity can be set up to allow users to connect to private or public gateways.

SD-WAN is one of the fastest-growing industry adoptions in recent years as it can fulfill the criteria of next-generation technologies with a strong network built on scalability, agility, flexibility, security, and compliance. Also, it delivers a final premium customer experience by offering an array of branch services at sustainable costs. Leading market players are introducing SD-WAN services to expand segmental growth. For instance,

• In October 2021, Telefonica Tech and Fortinet expanded their partnership to launch secure SD-WAN services. The new service combines networking and security features into a single combined offering to empower the hybrid task, enable employees to connect from sites, offices, or factories with the best security and performance, and broaden this experience when accessing business applications remotely.

LAN as a Service is anticipated to record the fastest CAGR during over 2022-2029 due to the demand for LANaaS solutions such as on-demand ports and Wi-Fi hotspots to access internet services that allow corporations to deliver mobile device access to their employees

By Enterprise Size Analysis

SMEs to Grow at Highest CAGR Owing to Lower Cost of Networking Services

Based on enterprise size, the market share is bifurcated into small and medium-sized enterprise and large enterprise.

The large enterprise segment is anticipated to dominate the market share over 2022-2029 due to increasing use of cloud services such as NaaS and Platform as a Service. Large enterprises are using virtualized technology to manage connections among remote enterprise sites and rising support for bring your own device (BYOD) trend, which allows them to manage their diverse sources cost-effectively. These technologies are likely to accelerate the adoption of network as a service as they reduce investment costs and enable companies to focus on other priorities.

Small and medium-sized enterprises are expected to grow at the highest CAGR due to lower infrastructure costs. SMEs have turned their focus on digital transformation to profit from emerging technologies such as cloud, SDN, analytics, and IoT due to the availability of low-cost cloud services and the as-a-service model.

By Application Analysis

Heightened Adoption of Mobility Services and Solutions across Multiple Sectors to Boost Market

Based on application, the market is segmented into vast area networks, virtual private networks, cloud-based services, bandwidth on demand, and others (integrated network security as service).

Wide Area Network (WAN) holds the largest market share due to increased demand for enterprise mobility. Mobile personal devices, such as smartphones, laptops, and tablets, are increasingly used to access corporate networks. The growing size of mobile datasets necessitates parallel processing across several servers and seamless interfaces. As a result, the adoption rate of SD-WAN has increased owing to these reasons.

Cloud-based services are expected to grow at the highest CAGR during the forecast period due to transmission from on-premise modules to cloud-based services and rising investments in cloud-related services by various end-use industries. For instance,

• According to the 2020 IDG cloud computing survey, around 32% of the total IT budget will be allocated to cloud computing in the coming years.

By End-User Analysis

Increased Adoption of Network-as-a-Service Software across IT & Telecom Sector to Drive Market Share

In terms of end-user, the market share is divided into IT & telecommunications, BFSI, healthcare, manufacturing, retail, and others (transportation).

Among these, the IT & telecommunications segment is anticipated to dominate the market share. IT and telecom firms are modernizing their outdated enterprise networks with virtualization technology due to significant financial advantages. Cloud-enabled virtualization techniques allow telecom carriers and network service providers to deliver network services more quickly while simultaneously addressing the concerns of bandwidth scarcity. The market's expansion will be fueled by cloud and networking technologies, which provide clients with on-demand network services while lowering IT equipment procurement and maintenance costs.

BFSI will record highest CAGR over 2022-2029. BFSI institutions have pushed to become more technologically proficient to provide on-the-go financial services to consumers due to the growing number of tech-savvy customers. The banking industry places a premium on financial data security. As a result, CIOs are choosing secure wireless connectivity to better data security, improve user experience, and provide new services to customers, which will help grow the market over the forecast period.

Healthcare segment will record notable growth during the projected period. The demand for a secure, reliable network as a service has increased as the adoption of remote patient monitoring and in-home health aides has increased.

REGIONAL INSIGHTS

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The market share is segregated into five major regions, including Asia Pacific, North America, the Middle East & Africa, Europe, and South America.

The market in North America will capture the largest market share during the forecast period. The region's growth was attributed to extensive research and development in network expansion technology and the region's technological maturity in data centers and network infrastructure. The region's economies are stable and well-established, allowing it to invest heavily in R&D and contribute to the creation of novel technologies in the era of network service providers. The presence of leading key players in this market focusing on launching new services partnerships will boost the market

• In September 2021, Extreme Networks, Inc. acquired Ipanema, Infovista's cloud-native enterprise SD-WAN branch. Extreme's ExtremeCloudTM portfolio will be expanded due to the acquisition, with additional cloud-managed SD-WAN and security software solutions needed to power the Infinite Enterprise.

Asia Pacific is estimated to record the highest CAGR during 2022-2029. North America is likely to provide the most lucrative outlook for NaaS providers owing to increasing investment in cloud-based networking technology. In this region, China and India are likely to surge the demand for NaaS. For instance, according to the hybrid workplace report 2020, 45% of APAC enterprises plan to increase their investment in cloud-based networking.

The Europe market will showcase considerable growth due to adoption practices, rising awareness, and network service concerns. Spain, Germany, and the U.K. have the highest rate of adoption of NaaS. Companies are widely adopting NaaS to boost productivity.

The economic growth of the Middle East & Africa due to government projects, cloud, significant data adoption, and technological innovation has contributed to this market growth.

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South America is expected to grow steadily during the forecast period owing to increasing investment by leading players and the rising number of digital start-ups in Brazil.

KEY INDUSTRY PLAYERS:

Leading Players such as Fortinet Inc. Eye Product Expansions to Boost Growth

Leading market players such as Fortinet, Inc. are focusing on designing and providing networks as a service worldwide. Fortinet offers extensive network services, next-generation firewalls, and SD-WAN.

• In December 2021, Fortinet, Inc. added seven new service providers to its secure SD-WAN platform. Eastern Communications, Halo Global, Convergia, Qatar, PLDT, Ooredoo, and Transtelco are involved. MSSPs can use its SD-WAN solution to provide high-value security-driven networking services to customers, expand their market, and grow their business by meeting customer needs.

List of the Key Companies Profiled:

• Cisco Systems, Inc. (U.S.)


• Verizon Wireless Inc. (U.S.)


• IBM Corporation (U.S.)


• Oracle Corporation (U.S.)


• Cloudflare, Inc. (U.S.)


• Global Cloud Exchange (U.K.)


• Telefonica S.A. (Spain)


• Aryaka Networks, Inc. (U.S.)


• NEC Corporation (Japan)


• VMware, Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• December 2021 – Aryaka Networks, Inc. introduced "all-in-one" SD-WAN and SASE solutions for various enterprise and hybrid workplace deployments. This measure has aided in accelerating cloud adoption and the expansion of business agility.


• December 2020 – Geoverse LLC launched network as a service platform, allowing companies, OEMs, systems integrators, and other partners to quickly add new capabilities to private cellular networks supporting the enterprise. The GeoCore Cloud EPC and GeoCore On-Prem EPC are components of this NaaS service, which is available in an expanding number of major cities.


• October 2020 – Cloudflare Inc. launched "Cloudflare One," a cloud-based network as a service solution. It integrated with major identity management and endpoint security companies to provide secure, quick, dependable, and cost-effective network services. It replaces numerous appliances and WAN technologies with a unified network that offers cloud-based security, performance, and control via a single user interface.

REPORT COVERAGE

An Infographic Representation of Network as a Service Market

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