Trend for outsourcing to take SaaS market to over $340 billion

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According to the latest information from researchers at Grand View, the global Software as a Service, or SaaS market, is projected to reach USD 344.3 billion by 2028, with an expansion CAGR of 11.00% to that date.The major growth factors are cited as the growing trend for the adoption of outsourcing business models in enterprises coupled with the growing number of small and medium enterprises (SMEs) and startups across the globe.

The rising trend toward mobile applications such as emails, video calls, and instant messaging further increases the usage of smart devices that further encourages the demand for Software as a Service (SaaS) during the forecast period. However, the growing data privacy and security concerns related to enterprise data are projected to hamper market growth during the forecast period.

The market demonstrated a significant rise in the overall revenue due to Covid-19 owing to the rising demand for cloud applications in the various enterprises due to Covid-19 restrictions and lockdown. Additionally, under the lockdown conditions imposed in some countries owing to the pandemic, many employees and companies prefer public cloud services such as SaaS. Therefore, the significant increase in the virtual cloud software platform services during work-from-home scenarios is further projected to contribute to market growth.

Reduced cost is motivation
Based on type, the market is further classified into enterprise software and productivity software. The enterprise software segment of the type is forecast to register a significant growth rate of 11.2% from 2022 to 2028. The significant adoption of SaaS among enterprises for reducing the cost of the on-premises software model is one of the major factors that contributed to the growth of the market. The SaaS provides enterprises and IT developers to effectively deliver virtual applications in the cloud environment, and streamline operational workflows at an effective price.

Significant share for Europe
Europe is estimated to hold a significant market share of more than 20% in 2021. Well-developed countries such as Germany, the U.K., and France are positively contributing to market revenue. The high market share can be attributed to the significant presence of the enterprises and cloud service providers such as SAP SE, Microsoft Corp, and others in the region, and the long-existing demand for mobile applications among enterprises. Moreover, the growing number of secured internet servers further provides a significant growth opportunity for the adoption of cloud applications and services in the region that further provide ample opportunity to the market.