Identity-as-a-Service: Combining Internet of Things and Identity of Things

Gone are the days when Internet of Things (IoT) was the 'next big thing' in the industrial landscape. The rise of 'Industry 4.0' has pushed businesses towards the actual next big thing-Identity of Things (IDoT).

Increased adoption of IoT has caused a stir in the technical and business approach of end users, and the explosion in the number of IoT-connected devices has triggered serious concerns about identity and access management. The demand for identity-as-a-service (IDaaS) has increased tremendously in the past decade, as the need for identity management platforms such as IDoT, for IoT initiatives, has intensified across the world.

The IDaaS landscape is witnessing exponential growth, as businesses are integrating IoT closely with integral business operations, and this has bolstered the need for a fresh approach towards their identity management processes. With the advent of next-generation technologies, including Artificial Intelligence (AI) and cloud computing, the IDaaS market has emerged as a multibillion-dollar landscape in the last few years.

Sensing the immense growth potential for the providers of identity-as-a-service in the IoT-driven industrial ecosystem, Transparency Market Research (TMR) offers exclusive insights on how to expand business in this highly-profitable landscape. TMR’s new study offers value-based information about the market dynamics and changing competitive landscape in the identity-as-a-service market through 2019-2027.

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IDaaS Market Set to Grow with the Evolution of Identity and Access Management Solutions

With the burgeoning adoption of IoT-based solutions across a wide range of industries, businesses have become highly vulnerable to threats such as identity theft and fraud. A mounting number of business organizations, including governing bodies, banks and financial institutes, and retail businesses, are moving towards adopting digital enterprise models. This has triggered the need for boosting the fraud reduction potential of identity and access management systems and identity proofing methods, and ultimately the growth of the IDaaS market.

Attributing to the rise of digitization, the cloud or SaaS (Software-as-a-Service)-based application delivery model is enjoying success in the identity-as-a-service market. In 2018, the valuation of the IDaaS market reached ~ US$ 3.5 billion, and it is expected to witness ~ 21% year-over-year growth in 2019. Upcoming trends in the IDaaS market are expected to drive a palpable shift from password-based to password-less identity and access management and authorization among end users.

BYOD Approach of End Users Boosts Demand for IDaaS for Public Cloud Platform

With a ~ 56% revenue share of the global market, the deployment of IDaaS for public cloud infrastructures is expected to underpin gains for stakeholders. In addition, the popularity of the 'Bring Your Own Device' (BYOD) trend is growing in most IT & telecommunications companies, and the IT departments of companies are struggling to protect their organization’s business assets with outside devices entering the company’s network. This is likely to bolster demand in the coming years.

Increasing penetration of multi-cloud computing systems in the modern industrial ecosystem, especially in IT and telecommunication companies, is voicing the need for more efficient identity management services for securing their public cloud infrastructures. The demand for IDaaS is relatively higher for public cloud than private or hybrid cloud infrastructures, owing to their vulnerability to cyber-attacks. However, the adoption of IDaaS in private and hybrid cloud networks is expected to increase significantly, directing the upcoming strategies of stakeholders in the IDaaS market.

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Shifting Focus from Large Enterprises to SMEs: A Key to Win

Leading providers of IDaaS have been capitalizing on the lucrative opportunities in developed countries, including the United States (U.S.) and leading European countries, owing to the increasing growth of the IT industry in these regions. In addition, the high implementation cost of IDaaS has made large enterprises the target customer for the providers of IDaaS. However, with the increasing number of small- and medium-sized enterprises (SMEs), the winning imperatives in the identity-as-a-service landscape are likely to change in the coming years.

Studies have found that, ~ 1.87 million SMEs were registered in 2015 and over 100,000 new businesses were registered in the U.K. in 2016. In addition, the number of SMEs registered in the U.S. has crossed the 30 million mark. Though SMEs are growing in developed economies, this trend is growing stronger in developing countries in Asia Pacific.

The business operations of ~ 70% of micro, small, and medium enterprises (MSMEs) in Southeast Asian countries depend upon labor-intensive services. With the advent of advanced technologies, including IoT, most MSMEs are increasing efforts in taking their business operations to digital platforms, by shifting from labor-intensive operations to digitized procedures. This is expected to influence the upcoming business strategies of stakeholders in the IDaaS landscape in the coming decade.

Tech-giants Maintain Lead with High Product Penetration Worldwide

Global leaders in technologies, such as Microsoft Corporation and Oracle Corporation, enjoy a significant revenue share in the identity-as-a-service market, with a strong presence across developed as well as developing regions. While investments in research & development (R&D) remains the most important strategy for market leaders, they are also adopting innovative marketing strategies to improve awareness about the availability of IDaaS in developing countries, to capitalize on the rise in the number of SMEs.

Global giants are strengthening their presence in the global market, while emerging players and local service providers are adopting strategies to establish a stronghold in regional markets for IDaaS. Other competitors such as OneLogin Inc., iWelcome, and ILANTUS Technologies are focusing on launching new products to gain a competitive edge in local markets for IDaaS. Some examples include,

  • In March 2018, OneLogin Inc. introduced its new product—OneLogin Access—which is designed for SMEs as well as large enterprises to manage access for on-premise and cloud-based applications with a single identity-as-a-service (IDaaS) solution.
  • In August 2018, ILANTUS Technologies Pvt. Ltd introduced its new product—Compact Identity—which includes identity and access management solutions with both, Access Management (Single Sign-On and Password Management) and basic Identity Governance and Administration (IGA) features.
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Analysts’ Viewpoint

Analysts of TMR’s study on the identity-as-a-service (IDaaS) market remain optimistic about the growth of the market, with the opinion that the market is set to grow 17X between 2019 and 2027. Various industries taking their operations to digital platforms, and increasing cyber threats, will continue to bolster developments in this exponentially-growing market for identity-as-a-service solutions. Most businesses, both, large enterprises and SMEs, are taking to tech-based solutions to protect their critical assets, and this is expected to augur well for stakeholders in the IDaaS market in the coming years.

Leading players in the identity-as-a-service landscape are offering identity management tools for businesses to ensure end-to-end security and real-time identity management, to gain an edge in such an intensely competitive market. With the advent of advanced technologies such as IoT and cloud computing, the competition in the IDaaS landscape is likely to become more intense, and collaborating with industry players and global leaders will prove to be a winning strategy for market players in the coming decade.

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Identity-as-a-Service (IDaaS) Definition

  • The identity-as-a-service (IDaaS) market report provides analysis of the global identity-as-a-service market for the period of 2017 – 2027, wherein, 2018 is the base year and 2019 to 2027 is the forecast period. Data for 2017 has been included as historical information.
  • Identity-as-a-service (IDaaS) is a cloud or SaaS (software-as-a-service)-based application delivery model, which helps enterprises connect and access identity management services from the cloud. It refers to identity and access management services that are offered on a subscription basis. IDaaS enables all users to more securely access sensitive information, both, on-premise and off-premise.

Identity-as-a-Service (IDaaS) Market in Brief

  • The global IDaaS market is expected to register a CAGR of ~ 26% between 2019 and 2027. Banks and the financial sector are extensively using identity-as-a-service due to tremendous Internet penetration among the population, and the increasing demand for digital transactions. Therefore, the IDaaS market is expected to expand at a rapid pace in the coming years.
  • The global identity-as-a-service market is expected to reach ~ US$ 26.2 Bn by 2027 from ~ US$ 3.5 Bn in 2018. The growing need to adopt new IT solutions with modern consumer trends across the world is driving the demand for IDaaS. This is anticipated to propel the market over the forecast period. Moreover, the increasing demand for digitalized payment systems across different industry verticals such as BFSI, government, retail & consumer electronics, healthcare, and IT & telecommunications is expected to fuel the growth of the identity-as-a-service market in the near future.
  • The identity-as-a-service market in Asia Pacific is anticipated to expand at a rapid pace during the forecast period, followed by the Middle East & Africa.
  • North America accounted for a leading market share in 2018, while the IDaaS market in Asia Pacific is anticipated to attain a prominent share by 2026. Growth in BFSI, retail& consumer electronics, and the healthcare industry in China and India, rapid infrastructure development, rapidly expanding electronic payment industry, speedy advancements in technology, growing trend of the BYOD policy, and huge adoption of cloud security solutions are likely to drive the identity-as-a-service market in the region.

Key Growth Drivers of the Identity-as-a-Service (IDaaS) Market

  • Growing adoption of cloud security solutions – The demand for identity-as-a-service is likely to increase significantly in the next few years, due to a rise in the consumer demand for cloud security solutions. Many organizations and enterprises have adopted cloud services to compute, network, and store data. However, companies need to be careful about their data security while providing access to their networks through the cloud to their employees who work remotely or work on their own devices. They are focusing on identity and access management systems to secure their corporate data. This is propelling the growth of the IDaaS market across the globe.
  • Integration of digital payment systems - Governments as well as banking organizations are presently encouraging digital payments in order to reduce their operating costs, and for the better visibility of transactions. Thus, the integration of digitalized payment systems is expected to propel the demand for identity-as-a-service in the near future

Key Challenges Faced by Identity-as-a-service (IDaaS) Market Players

  • High cost and complexities associated with the implementation of identity as a service is a significant inhibitor to the growth of the market. With the rise in the volumes of data and security breaches, most industries have adopted data security solutions. Thus, the high implementation cost is retraining the growth of the identity-as-a-service market.
  • Lack of awareness and apprehensions about adopting cloud security solutions is another crucial factor that is hindering the growth of the identity-as-a-service market. This is primarily because these online authentication/identification and transactions involve extensive personal information related to the bank accounts of users.

Identity-as-a-Service (IDaaS) Market – Competitive Landscape

  • In May 2018, CA Technologies collaborated with Emirates NBD, a banking group from the Middle East, to improve e-Commerce activity of customers and fuel industry growth through the company's CA Payment Security Suite.
  • In September 2018, Exostar acquired U.K.-based Pirean Limited in order to expand its global business operations and technology portfolio.
  • In May 2019, iWelcome acquired multi-factor authentication software and technologies from UNLOQ.

Other major players operating in the global identity-as-a-service (IDaaS) market and profiled in the report include CA Technologies, Centrify Corporation, ILANTUS Technologies, Exostar, iWelcome, JumpCloud, Okta, Inc., OneLogin Inc., Oracle Corporation, Ping Identity, and Salesforce.com. Companies are shifting toward product innovations and up-scaling their skills to gain a competitive advantage in the identity-as-a-service market, apart from maintaining their position in the market.

Transparency Market Research (TMR) recently published a study on the identity-as-a-service (IDaaS ) market, which offers the overview of the market. TMR’s study provides readers with a detailed explanation on the market dynamics, including trends and avenues of growth for stakeholders in the market through 2019-2027. In this study, detailed analysis on various factors influencing developments in the identity-as-a-service market is included, along with qualitative as well as quantitative insights on the future growth of the market.

The study includes information about factors that are influencing the expansion of the IDaaS industry, including world GDP indicators and other macro and microeconomic factors that are driving or impeding market growth. A detailed analysis on the pricing and adoption of IDaaS has also been presented in a comprehensive manner in this TMR study.

The information featured in TMR’s study on the identity-as-a-service market can help market players, including manufacturers, retailers, suppliers, and distributors, to adopt appropriate strategies. Readers can also find an assessment on how the demand for IDaaS is changing trends across various end-use industries, in TMR’s study. The study also offers important information about international as well as regional markets for IDaaS, which can help decision-makers in the market build important strategies in the coming years.

Key Questions Answered in TMR’s Identity-as-a-Service (IDaaS) Market Report

  • Are there any risks associated with making investments in the IDaaS markets in developing countries?
  • Which strategies proved successful for leading players in the IDaaS landscape to gain a competitive edge?
  • Which regions will prove to be most lucrative for IDaaS providers in the coming years?
  • How are the recent trends in the IT (Information Technology) & telecommunication industry impacting the growth of the IDaaS landscape?
  • What are the critical challenges faced by IDaaS companies in this market?
  • Why is the IDaaS market growing at a relatively faster growth rate in North America than in Asia Pacific?

Identity-as-a-Service (IDaaS) Market: Research Methodology

With the help of statistics and data verified by several resources—both, secondary and primary resources—analysts could come up with exclusive insights about the future trends in the IDaaS landscape, which can help readers understand how the identity-as-a-service market will expand during the forecast period. TMR has implemented a unique research methodology to conduct the assessment on the growth parameters of the identity-as-a-service market, and reach conclusions about market size-related information.

Secondary resources that have contributed to the production of this report include various government documents, white papers, regulations, and research papers that highlight the sales potential for identity-as-a-service. Secondary resources have been referred to by analysts to confirm the accuracy of the forecast on growth prospects and future trends of the identity-as-a-service market.

Analysts have interviewed c-level executives and as brand managers of companies in the supply chain of the identity-as-a-service market, as well as investors and industry experts, who contributed to the development of this report as a primary resource. Information acquired through primary and secondary resources acts as a validation from leading market players and stakeholders, and this makes estimates on the future prospects of the identity-as-a-service market in TMR’s study more accurate and reliable.

Segmentation of the Identity-as-a-Service (IDaaS) Market

TMR’s study on the identity-as-a-service market has been segmented into seven categories - deployment type, service type, enterprise type, access type, application, industry, and region. The information featured in the study helps readers understand the growth prospects of the identity-as-a-service market according to the aforementioned segments.

Deployment Type

Public

Private

Hybrid

Service Type

On-site

In-house

Enterprise Type

Small & Medium Enterprises (SMEs)

Large Enterprises

Access Type

Single Sign-on

Multi-factor Authentication

Compliance Management

Directory Services

Others

Application

Document Verification

Authentication/ Identification

Screening

Industry

Government

Retail & Consumer

Electronics

Transportation &

Logistics

Media &

Entertainment

IT &

Telecommunications

BFSI

Energy & Utility

Healthcare

Automotive

Others

Region

North America

Europe

Asia Pacific

Middle East & Africa

Latin America