IDaaS Market

[367 Pages Report] The global IDaaS market size is projected to grow from USD 7.0 billion in 2023 to USD 21.4 billion by 2028 at a Compound Annual Growth Rate (CAGR) of 25.0% during the forecast period. The expansion of the IDaaS market can be attributed to government initiatives and regulations to support digital identity transformation and the rise in identity and authentication frauds.

Moreover, the IDaaS market is experiencing growth due to the introduction of AI/ML-powered services. These factors contribute to the market’s promising growth potential, providing organizations with enhanced security measures.

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IDaaS Market Dynamics

Driver: Rise in identity and authentication frauds

The rise in identity and authentication fraud has become a significant concern for businesses across various industries. The trend represents a growing challenge that organizations must address to safeguard their operations and customer data. In today’s digital landscape, where remote work and online transactions have become the norm, cybercriminals are becoming increasingly sophisticated in their methods. They exploit vulnerabilities in identity verification and authentication processes to gain unauthorized access to systems, steal sensitive information, and engage in fraudulent activities. In 2021, more than 5.88 million fraud reports were filed with the FTC, a 19% increase from the previous year. Identity theft complaints were the largest fraud category, accounting for 1,686,121 complaints received by the FTC. These attacks can lead to operational shutdowns, data leakage, and revenue loss. These losses cause significant financial concerns for organizations, and those organizations' reputations are constantly at stake.

Restraint: Reluctance of organizations to adopt cloud-based security

Due to security concerns, several enterprises are dubious about adopting cloud-based security solutions. According to a cloud survey, identity security is one of the top issues for businesses worldwide. Despite the financial advantages of cloud-based security, companies prefer to handle their data and apps on-premises. The hesitation among organizations to embrace cloud-based security solutions stems from several valid concerns rooted in the desire to protect their digital assets and sensitive data.

Another common misconception is that cloud-based standards are not yet developed enough to meet IT security requirements. Additionally, despite a surge in cloud-based security solutions, few businesses know these solutions' potential dangers and hazards. Enterprises' hesitation is constraining the expansion of the IDaaS market to migrate to the cloud.

Opportunity: Integration of AI, ML, and blockchain technologies to enhance digital identities

Integrating AI, ML, and blockchain technologies is a trending concept. Designed computerized systems are replacing human efforts and minimizing potential risks. AI and ML are playing a pivotal role in enhancing digital security by enabling predictive threat analysis and rapid response. They can identify patterns and anomalies within vast datasets, swiftly detecting unusual activities that might indicate a security breach. The proactive approach allows businesses to address vulnerabilities before they can be exploited. AI and ML also empower security systems to adapt and learn from new threats, continually improving their ability to thwart cyberattacks. IDaaS solution vendors can apply ML-based analytics to large volumes of identity-related data and access activities. It helps reduce the identity attack surface by accurately measuring and reporting on a user, account, application, department, and organizational risk posture. It also exposes anomalous access and helps implement risk-based access certifications, which help identify and authenticate. Sectors such as automobiles, BFSI, and the government have started implementing these technologies.

Challenge:Ownership and privacy challenges

IDaaS is a cloud-based identity and access management system hosted and managed by a third-party vendor. The Identity as a Service (IDaaS) market is experiencing rapid growth, but it also presents certain ownership and privacy challenges for businesses. One of the primary challenges pertains to the ownership of user identity data. When organizations adopt IDaaS solutions, they often entrust a third-party service provider with critical user identity information. It raises concerns about who ultimately owns the data - the business or the IDaaS provider. Clarity on data ownership is crucial, as it impacts control, compliance, and the ability to switch service providers if needed..

IDaaS Market Ecosystem

By verticals, government vertical is expected to grow at the highest CAGR during the forecast period.

Cyberattackers always target government agencies to gain access to confidential government data. Governments in emerging economies are deploying web and mobile applications to serve their citizens efficiently. Due to this, the public sector and government organizations handle data and consumer identities of a critical nature more efficiently. These applications are becoming the prime targets for cybercriminals to access sensitive data. Identity frauds in the government/public sector include misappropriation of assets, identity thefts, bribery and corruption, accounting fraud, data thefts, and money laundering. The incidents of identity thefts to access confidential government data have increased, resulting in the adoption of IDaaS solutions in government agencies.

By deployment mode, private cloud is expected to grow at the highest CAGR during the forecast period.

Private cloud refers to computing wherein the computing resource is accessed by a single organization and restricted to external entities. Organizations that invest in their on-premises data centers can also use it as a private deployment type. Private cloud IDaaS provides organizations with greater control and data sovereignty. Private cloud offerings can be customized to meet an organization's specific needs. It particularly appeals to businesses operating in highly regulated industries or regions with strict data privacy requirements. With a private cloud, organizations can maintain sensitive data within their infrastructure and under their direct supervision, ensuring compliance with data protection regulations.

By region, North America accounts for the highest market size during the forecast period.

North American companies are quite advanced when it comes to making a shift towards cloud-based technology and implementing Identity and security management solutions to have best practices for their everyday business processes with the presence of key IDaaS solution vendors in the region, including Okta, Idaptive, Sail Point, Ping Identity, Microsoft, Oracle, IBM, and OneLogin resulting in the adoption of IDaaS solutions in the region. The other drivers for the growing demand for IDaaS solutions in the region include the need to comply with strict compliance regulations. North America is a highly regulated region globally with numerous regulations and compliances, such as the Federal Energy Regulatory Commission (FERC), HIPAA, PCI DSS, and SOX, across verticals. These regulations are also driving the IDaaS market in North America.

Key Market Players

The key players in the IDaaS market are Okta (US), Microsoft (US), Thales (France), Ping Identity (US), IBM (US), Atos (France), Oracle (US), Salesforce (US), Google (US), CyberArk (US) and others.

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Scope of the Report

The study categorizes the IDaaS market by component, deployment type, verticals, and regions.

By Component:

• Provisioning
• Single Sign-on
• Advance Authentication
• Audit, Compliance, and Governance
• Directory Services
• Password Management

By Deployment type:

• Public Cloud
• Private Cloud
• Hybrid Cloud

By Vertical:

• BFSI
• IT & ITeS
• Energy and Utilities
• Government
• Manufacturing
• Healthcare
• Telecommunication
• Other Verticals

By Region:

• North America
• Europe
• Asia Pacific
• Middle East & Africa
• Latin America

Recent Developments

1. In September 2023, Eviden, a security industry leader inside the Atos Group, announced a partnership with HID Global. Through the agreement, businesses employing HID technology for logical and physical access control aims to use Eviden's Identity and Access Management suite to access their digital assets.
2. In May 2023, Ping Identity launched PingOne Protect, a new fraud detection and risk management service. By integrating Identity and Access Management (IAM) with comprehensive, intelligence-based fraud detection across the entire user experience, PingOne Protect adopts a distinctive strategy for threat protection.
3. In December 2022, Thales Group partnered with Zimbra. In the partnership, Zimbra will utilize Thales Group’s SafeNet Trusted Access (STA) to provide SSO, policy configuration, and MFA.
4. In November 2022, Okta launched Okta Customer Identity Cloud, an easy-to-implement and customizable customer identity solution. The Okta Customer Identity Cloud for Consumer Apps helps any organization with advanced security features like Adaptive MFA.
5. In September 2022, Microsoft partnered with Silverfort to bring unified identity protection to on-premises and cloud. Silverfort developed a unified identity protection system with the aid of Microsoft’s MFA.

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