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The U.S. data privacy software market size was valued at USD 0.67 billion in 2022. The market is projected to grow from USD 0.90 billion in 2023 to USD 8.60 billion by 2030, exhibiting a CAGR of 38.1% during the forecast period.
Data privacy has become an enterprise-critical and crucial component of customer belief for enterprises worldwide. Data privacy software helps enterprises to manage and operate customers' private data. The software categorizes the customer's content according to the country's compliance rules and regulations.
With the rising Big Data and IT advancements in the U.S., the need to protect the data has also increased across the country. Thus, more enterprises and users are demanding better data privacy software solutions. Legislators, firms, and organizations have already announced several plans and initiatives to address data privacy. For instance,
Rise in Remote Working Concept Fuels the Demand for Data Privacy Software Market
The 2020 pandemic changed the regulatory ecosystem and business functionalities, with considerable periods of remote set-ups. As the firms shifted the entire workflow to the virtual environment, the major constraints faced by the enterprises were capacity for remote access and system control access. With the evolution and complexity of the privacy landscape, firms found compliance predominantly challenging. Thus, it created a huge demand for data privacy software among BFSI, government, healthcare, and other industries to keep their customers’ data safe and secure.
Firms have been using cookies, the tiny text files kept on the browser, to track website visitors and evaluate users' online behavior. It helps advertising and marketing firms to target their users, but even consumers are concerned about their personal data.
As per Pew Report, 79% of users in the Americas are concerned about their data privacy, 41% of U.S. users delete cookies frequently, and 30% of consumers have downloaded adblockers.
Hence, various organizations and enterprises implement advanced methods and technologies for targeting and tracking users. Moreover, various enterprises are experimenting with new user-interaction technologies to deliver a private and secure method of tracking consumers. Other than this, firms are also using unique identifiers that can be used to track user actions without using cookies.
Revised Government Regulations for Data Security to Boost the Market Growth
The rising cyber-attacks have driven the need for organizations to fulfill stricter and more comprehensive necessities for assembling and processing private data. Privacy continues to shift, mature, and evolve with emerging guidelines in the U.S. These regulations cover more consumers with five new U.S. laws: CPRA (California Privacy Rights Act), UCPA (Utah Consumer Privacy Act), the Virginia CDPA (Consumer Data Protection Act), CTDPA (Connecticut Data Privacy Act), and CPA (Colorado Privacy Act). With such a growing number of privacy regulations in the region, the need for enterprises to focus on privacy trends to protect customers' data and privacy compliance also increases. Further, various firms across the country are focusing on innovating and advancing their software as per the guidelines.
Hence, privacy-enriching technology is rising the prominence of tech firms with advancements in-line with government laws, thus enhancing data privacy software market growth.
Compilation with Inherently Complex Data Protection Laws to Impede Market Expansion
The U.S. has multiple sectoral data security and protection regulations within its states. Some of these laws only apply to government organizations, some to private entities, and some to both. Hence, the U.S. is undergoing a considerable drive to push privacy legislation across the various states.
Such multiple laws and regulations make it difficult for enterprises to offer solutions that comply with all the laws. Companies can comply and make advancements as per a single federal standard. They can hire professionals as per those specific standards and invest in compliance tools to develop a robust program as per all the state laws. It deepens the complexity for firms that function over both abroad and stateside. Thus, it restricts new developments and limits the expansion of key players in the region.
Hence, complexity in compliance with software and tools inhibits the market expansion.
Rising Demand for Cloud-based Software to Fuel the Data Privacy Software Market Growth
Based on deployment, the market is categorized into the cloud and on-premises. The on-premises segment is anticipated to grow at a steady CAGR over 2023-2030, owing to its secured and reliable in-house capability. Cloud-based software is expected to gain prominent growth in the coming years. As the adoption of digital technology among businesses is growing, enterprises are adopting cloud-based software to expand their capability to store a large amount of data. This is likely to drive the cloud-based software market.
Increase in Stringent Government Regulations to Fuel Compliance Management Demand
Based on application, the market is divided into reporting & analytics, risk management, compliance management, and others. Compliance management is anticipated to hold a larger share of the market during the forecast period. The software helps enterprises to execute activities in line with the rules to secure important data. The increasing rules and regulations in support of data protection are propelling the demand for software across compliance management applications. Risk management is anticipated to grow at a rapid pace, as the software evaluates and identifies threats and negative impacts of the operation on the individual’s data.
Prominent Presence of Large Enterprises Across the Country to Drive Demand for Data Privacy Software
Based on enterprise type, the market is bifurcated into large enterprises and small & medium enterprises (SMEs). Large enterprises are anticipated to capture a larger share of the market during the forecast period. The majority of large enterprises have a significant presence in the U.S., which plays a vital role to drive the adoption of software to manage country-wise data protection law.
SMEs are expected to gain traction during the forecast period. The rise in the number of data breach incidents across the country has surged the demand for this type of software among start-ups, SMEs, and government enterprises.
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Rise in Digital Banking Applications to Drive Demand for Software in BFSI Sector
Based on industry, the market is categorized into BFSI, government, IT and telecommunication, healthcare, retail, manufacturing, and others (education).
The BFSI industry is anticipated to hold the major market share in the coming years. An increase in the number of online customer interactions and the rise in the adoption of digital banking applications are anticipated to fuel the demand for software. Further, the healthcare industry is expected to grow at the highest CAGR in the upcoming years. The increasing threats to patients’ health data with rising cyberattacks on the industry are likely to boost the market growth.
Key Companies Are Focused on Offering Solutions in Line with New Regulations
The key players are investing in developing and launching advanced privacy software to fulfill the growing demand for data protection and management. These players are offering software to manage customer data as per the guidelines and regulations of every country. Some of the leading players are providing interactive sessions for the organizations to interact with software and security professionals for managing the clients’ information.
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The research report highlights the pivotal factors propelling market growth to offer a better understanding to the user. Furthermore, the report provides insights into the latest market trends and analyzes technologies deployed at a rapid pace at the global level. It further highlights some of the growth-stimulating factors and restraints, helping the reader gain in-depth knowledge about the market.
CAGR of 38.1% from 2023 to 2030
Value (USD Billion)
By Deployment, Application, Enterprise Type, and Industry
By Enterprise Type
The market is projected to reach USD 8.60 billion by 2030.
In 2022, the market size stood at USD 0.67 billion.
The market is projected to grow at a CAGR of 38.1% over the forecast period.
Compliance management is expected to lead the market.
Revised government regulations for data security enhances the market growth.
OneTrust, TrustArc, Inc., BigID, Inc., Securiti.AI., AvePoint, Inc., IBM Corporation, and RSA Security LLC are the top players in the market.
The healthcare industry is expected to grow with the highest CAGR.
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