The global network as a service market size is projected to hit around USD 192.3 billion by 2033 from USD 14 billion in 2023, remarkable at a CAGR of 30% from 2024 to 2033.
Key Takeaways
- North America contributed 42% of the share in the network as a service market in 2023.
- Asia-Pacific is estimated to expand the fastest CAGR between 2024 and 2033.
- By type, the WAN as a service segment held the largest market share of 53% in 2023.
- By type, the LAN as a service segment is anticipated to grow at a remarkable CAGR of 18.7% between 2024 and 2033.
- By enterprise type, the large enterprise segment generated over 56% of the market share in 2023.
- By enterprise type, the small and medium-sized enterprise segment is expected to expand at the fastest CAGR over the projected period.
- By end-user, the corporate customers segment generated over 59% of the market share in 2023.
- By end-user, the individual customers segment is expected to expand at the fastest CAGR over the projected period.
The Network as a Service (NaaS) market is witnessing rapid growth and transformation, driven by the increasing adoption of cloud computing, software-defined networking (SDN), and the proliferation of Internet of Things (IoT) devices. NaaS refers to the delivery of networking services on a subscription basis, allowing organizations to access and manage networking resources through a third-party provider rather than investing in and maintaining their own infrastructure. This model offers scalability, flexibility, and cost-effectiveness, making it an attractive option for businesses seeking to streamline their networking operations. The NaaS market encompasses various services such as virtual private networks (VPNs), bandwidth on demand, network security, and application delivery.
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Growth Factors:
Several factors are contributing to the growth of the NaaS market. Firstly, the increasing adoption of cloud computing solutions by enterprises is driving demand for flexible and scalable networking services to support their cloud-based applications and workloads. Additionally, the rise of remote work and digital transformation initiatives has underscored the need for reliable and secure connectivity, further fueling the demand for NaaS solutions. Moreover, advancements in technology, such as SDN and network function virtualization (NFV), are enabling more efficient and agile network management, driving the adoption of NaaS among organizations of all sizes.
Network as a Service Market Scope
| Report Coverage | Details |
| Growth Rate from 2024 to 2033 | CAGR of 30% |
| Global Market Size in 2023 | USD 14 Billion |
| Global Market Size by 2033 | USD 192.3 Billion |
| U.S. Market Size in 2023 | USD 4.12 Billion |
| U.S. Market Size by 2033 | USD 57 Billion |
| Base Year | 2023 |
| Forecast Period | 2024 to 2033 |
| Segments Covered | By Type, By Enterprise Type, and By End-user |
| Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
Network as a Service Market Dynamics
Trends:
One of the prominent trends shaping the NaaS market is the convergence of networking and security services. With the growing sophistication of cyber threats, organizations are increasingly seeking integrated solutions that provide both networking and security functionalities. As a result, NaaS providers are expanding their offerings to include comprehensive security services such as threat detection, encryption, and access control. Another notable trend is the emergence of edge computing, which involves processing data closer to the source rather than in centralized data centers. This trend is driving the demand for edge-centric networking solutions, including NaaS offerings tailored for edge environments.
Opportunities:
The NaaS market presents significant opportunities for providers to capitalize on the growing demand for flexible and cost-effective networking solutions. One key opportunity lies in catering to the needs of small and medium-sized enterprises (SMEs) that may lack the resources to invest in traditional networking infrastructure. By offering NaaS solutions tailored to the needs of SMEs, providers can tap into a large and underserved market segment. Additionally, the increasing adoption of IoT devices across various industries presents opportunities for NaaS providers to offer specialized connectivity solutions optimized for IoT deployments. Moreover, partnerships and collaborations with cloud service providers and technology vendors can enable NaaS providers to enhance their service offerings and reach new customers.
Restraints:
Despite its growth prospects, the NaaS market faces several challenges and restraints. One significant restraint is the security and privacy concerns associated with outsourcing networking services to third-party providers. Organizations may be hesitant to entrust their sensitive data and critical network infrastructure to external vendors, especially in light of recent high-profile data breaches and cyber attacks. Moreover, regulatory compliance requirements such as GDPR and HIPAA impose stringent data protection obligations on organizations, further complicating the outsourcing decision. Another restraint is the potential for interoperability issues and vendor lock-in when adopting NaaS solutions, as organizations may face challenges integrating NaaS offerings with their existing IT systems and infrastructure.
Segments:
The NaaS market can be segmented based on various factors such as service type, deployment model, organization size, vertical, and region. In terms of service type, key segments include connectivity services, network security services, application delivery services, and others. Regarding deployment model, segments include public NaaS, private NaaS, and hybrid NaaS solutions. Organization size segments may include small and medium-sized enterprises (SMEs) and large enterprises. Vertical segments encompass industries such as healthcare, BFSI (banking, financial services, and insurance), IT and telecommunications, manufacturing, retail, and others. Geographically, the market can be segmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.
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Recent Developments
- In May 2023, Cloudflare Inc. joined forces with IT services giant Kyndryl to unveil a novel managed WAN as a Service offering. This strategic partnership integrated networking services with Cloudflare’s Magic WAN DDoS mitigation and connectivity platform, aiming to elevate performance and security for users making the transition to modern IT technologies.
- In April 2023, Hewlett Packard Enterprise (HPE) introduced an upgraded version of its cloud management platform, HPE Aruba Networking Central, during its Atmosphere event. This release featured AI for IT operations (AIOps) and enhanced network capabilities. Utilizing the GreenLake platform, HPE provided Artificial Intelligence (AI)-powered data analytics and performance optimizations for network administrators.
- Megaport and colocation provider Element Critical collaborated in May 2023 to launch a Network as a Service (NaaS) platform. Through this partnership, customers gained access to Megaport’s software-defined networks and cloud interconnection services, enabling them to connect their allocated assets directly to multiple cloud providers and branch offices via a single network port. This initiative aimed to offer enhanced control and cost management capabilities.
- In July 2022, Amazon Web Services, Inc. announced the general availability of AWS Cloud WAN, a managed WAN service facilitating the connection of site-to-site, inter-region workloads, and site-to-cloud in AWS. The platform was seamlessly integrated with leading SD-WAN vendors such as Aruba, Checkpoint, Prosimo, Aviatrix, Cisco, and VMware.
- In April 2022, Aryaka received software-defined core (SD-core) technology and software-defined wide area network (SD-WAN) service from SoftBank Corp, a prominent Japanese conglomerate. This collaboration was driven by SoftBank Corp’s need to provide its customers with high-speed and stable data communications, requiring a network that was both adaptable and highly secure.
Competitive Landscape:
The NaaS market is characterized by intense competition, with numerous players vying for market share and differentiation. Key players in the market include established networking vendors, cloud service providers, telecommunications companies, and startups offering innovative NaaS solutions. These players compete based on factors such as service offerings, pricing, geographic presence, technological innovation, and customer service. Mergers and acquisitions are common in the NaaS market as companies seek to expand their service portfolios, enter new markets, and gain a competitive edge. Additionally, partnerships and collaborations are prevalent as players aim to leverage each other’s strengths and capabilities to deliver comprehensive NaaS solutions to customers. Overall, the competitive landscape of the NaaS market is dynamic and evolving, driven by technological advancements, changing customer preferences, and market consolidation efforts.
Network as a Service Market Companies
- Cisco Systems, Inc.
- Juniper Networks, Inc.
- VMware, Inc.
- Aryaka Networks, Inc.
- Megaport Limited
- AT&T Inc.
- IBM Corporation
- Oracle Corporation
- Ciena Corporation
- Comcast Business
- Alcatel-Lucent Enterprise
- Masergy Communications, Inc.
- Verizon Communications Inc.
- GTT Communications, Inc.
- Silver Peak Systems, Inc.
Segments Covered in the Report
By Type
- WAN as a Service
- LAN as a Service
By Enterprise Type
- Small and Medium-sized Enterprise
- Large Enterprise
By End-user
- Corporate Customers
- Individual Customers
By Geography
- North America
- Europe
- Asia-Pacific
- Latin America
- Middle East and Africa
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