Market Overview:

The Global Networking Service Market Size Was Valued At USD 6.67 Billion In 2022 And Expected To Grow At USD 64.91 Billion With CAGR Of 32.9% From 2023 - 2030.

Network service providers and cloud service providers offer network security resources including VPNs, WANs, and firewalls. It enables clients to manage and operate their networks without maintaining network infrastructure, and it optimizes resource allocation and computing resources as a single unified module. It offers enterprise wide area network (WAN) services using a business model based on subscriptions. The package includes hardware, software, licenses, and hosting services. Customers who do not wish to build their own network infrastructure are offered network services from third parties by vendors in the global network-as-a-service market. These global Network-as-a-Service market participants offer network services, applications, and resources as consumable products that can be purchased by various corporate entities for use by a large number of users or customers. Typically, vendors on the global Network-as-a-Service market provide these services for a contractually determined duration. WAN as a service and LAN as a service are the two primary services provided by market participants in the global Network as a Service market.

COVID-19 Impact:

The pandemic of COVID-19 has had a substantial impact on customer preferences and behavior. The pandemic has had a substantial impact on service industries including retail, BFSI, manufacturing, and transportation. Transitioning gradually from traditional to online platforms led to the development of enterprise network solutions and services for efficient centralized management. Therefore, the IT industry is essential to the maintenance of digital infrastructure. In addition, enterprise networking software and licensing management components fuel market expansion via subscription. Networking services provide a higher level of operational automation while maintaining a reasonable cost structure, thereby facilitating the introduction of an abundance of new services. In addition to reducing operational risks, networking services enable businesses to take advantage of cutting-edge product features and functions. As a result, the COVID-19 pandemic has accelerated market expansion by boosting the adoption of networking services products.

Market Dynamics:

Market Trends:

• Surge in Adoption of Cloud Services among Enterprises

Network as a Service has many benefits because more and more businesses are using cloud services. Cloud services give organizations a very flexible infrastructure that can easily meet their changing needs. NaaS takes advantage of this scalability by providing flexible network resources that can be changed based on demand. This lets businesses expand their network capabilities without making big investments in new hardware or infrastructure.

Using cloud services is also a crucial part of running a business in the U.S. It is a cost-effective way to do things like store data, run databases, run servers, and run networking software. It is an important tool that helps businesses run well and efficiently. Because cloud services for NaaS are cost-effective, organizations only have to pay for the network services they use. This means they don't have to pay for capital or expenses up front, and their operational costs go down. This pay-as-you-go model helps budgets and resources be used more effectively.

Driving Factors:

• Network Virtualization and Cloud Computing are becoming More Widely Used

Adoption of network virtualization and cloud computing services has substantially increased the quantity of data collected on digital and social platforms. In the context of cloud computing, network-as-a-service (NaaS) provides scalable, pluggable, and API-driven network management that enables customers to operate and build networks online. NaaS is a networking framework that extends to network service providers the on-demand and self-service provisioning model of cloud computing. Consequently, expanding cloud computing implementation contributes to market expansion.

• The Popularity of Cloud-Based Services is Growing

Cloud-based services are becoming increasingly popular as the number of cloud-based business applications increases. The adoption of cloud computing is growing as small and medium-sized businesses invest more. Cisco Systems predicts that global cloud data center IP traffic will reach 19,509 Exabytes by 2021. Consequently, the increasing popularity of cloud-based services is anticipated to drive market expansion.

Restraining Factors:

• Lack of Standardization, as well as Concerns about Data Privacy and Security

The biggest problem in this market is how hard it is to make sure that clients' NaaS services meet all the rules and regulations. Market vendors must follow the right security and regulatory policies, which are important for businesses to reach their business goals. To encourage the growth of NaaS solutions, cloud providers must meet strict scalability requirements for storage, computing, and network resource sharing. These requirements include things like more security, business reorganizations, mergers, and consolidations. At some point, the vendors may find it hard to keep their technologies up-to-date, secure, and in line with certain standards and laws. If a vendor doesn't follow the rules and regulations, it can have a direct effect on the services they offer their clients. This can lead to major financial and business risks for their clients and their business processes. NaaS service providers are honest with their customers about everything. They focus on programs and services and offer them by following set standards and the best ways to provide services. As technology changes, it gets harder for vendors to keep up with both the changes in technology and the changes in government rules. This is a big problem for both sellers and buyers in this market.

• Difficulty of Ensuring Proper Compliance

Concerning the provision of NaaS services to customers, the difficulty of ensuring proper compliance is the market's primary challenge. The implementation of appropriate security and governance policies is essential for businesses to achieve their objectives. To facilitate the development of NaaS solutions, cloud providers must meet stringent scalability specifications in terms of storage, computing, and network resource sharing in order to meet specific requirements such as increased security, business restructuring, mergers, and consolidations. At some point, it may be difficult for vendors to maintain and secure their technology and comply with certain regulations and standards. Noncompliance with regulations and standards by suppliers has a direct impact on the services they provide to customers, posing substantial financial and business risks for customers and their business processes. Customers receive full transparency from NaaS service providers. They emphasize and deliver programs and services by adhering to service delivery standards and best practices. It is difficult for vendors to keep up with changing technologies and government regulations as technology advances. This is a significant obstacle for suppliers and clients in this market.

Opportunities:

• Adoption of Service-Based Business Models

The pandemic has compelled organizations worldwide to adopt remote working facilities. Within a few days to a week, companies relocated employees to remote locations and instituted work-from-home policies. As COVID-19 has a growing impact on businesses, the number of remote workers increases daily. Some companies have implemented permanent work-from-home policies for their employees. Consequently, organizations are adopting service-based business models for networking, computing, and storage. During the pandemic, cloud adoption has skyrocketed across all industries. Most businesses have adopted web service business models based on as-a-service and subscriptions. Therefore, the NaaS market is in high demand within the industry. NaaS offers a variety of advantages, including cost reduction, proactive maintenance, enhanced security, increased uptime, improved service quality, increased performance and productivity, optimized systems, and acquired expertise. Growth-wise, remote workforce strategies are on the ascent and will continue to expand at an exponential rate.

• Increasing Network-As-A-Service (NaaS) Adoption in the Information Technology (IT) and Telecommunications Sectors

During the forecast period, the market is anticipated to be dominated by the expanding use of cloud computing services in the IT and telecommunications sector. As a result, cloud-based networking services, which provide end users with on-demand access to network resources, are gaining popularity alongside cloud computing services. IT and telecom end users' adoption of cloud technologies and networking is accelerating during the forecast period. During the forecast period, applications ranging from email checking to the management of massive amounts of company data in the cloud will generate numerous growth opportunities.

Challenges:

• Security Issue of Cloud-Based Network Connections

The security issue of cloud-based network connections is one of the major obstacles in the Network services market, which hinders the adoption of NaaS solutions across various vertical industries. When deciding between cloud-based and on-premises solutions, security is a primary factor for businesses. Network services solutions face synchronization issues due to network complexity and complex applications. Therefore, outsourcing network connectivity can pose security concerns for an organization. Organizations frequently believe that Network services-based connections expose their sensitive data and result in a loss of control over their network infrastructure. Consequently, businesses are hesitant to adopt cloud-based networking solutions.

• Low Latency Connectivity

NaaS offers businesses and organizations low latency connectivity, global coverage, and negligible packet loss via a global point of presence (POP) backbone when connecting to platform-as-a-service, software-as-a-service, infrastructure-as-a-service, or branch office applications. It is possible to deploy, order, and co-manage these services. It includes network access solutions and managed services, as well as unified communication services on virtualized customer premise equipment (vCPE) or the public cloud.

Strategic Development:

• In April 2021 - South Korea, Asia's fourth-largest economy, and global technology leader Cisco announced the launch of a collaborative framework under the Cisco National Digital Acceleration (CDA) program in order to accelerate South Korea's digital journey and drive an inclusive recovery from the COVID-19 pandemic.
• In April 2021 - AT&T will provide ERIKS with a global wide area network spanning 17 countries. ERIKS is a Dutch company that develops digital capabilities. AT&T will convert ERIKS' U.S. transmission network to one that is entirely managed by AT&T.
• In March 2020 - The partnership between Ericsson and Oman Communications Service Provider will allow Oman Telecom to improve operational network efficiency and further enhance the user experience beginning. Since 2016, the company has been an Omantel-managed service partner.

Key Vendors:

Top market players includes

• Cisco Systems

Whether in business, education, philanthropy, or creativity, Cisco enables people to make powerful connections. Cisco hardware, software, and service offerings are used to create the Internet solutions that make networks possible, allowing for simple access to information from anywhere in the world. A small group of computer scientists from Stanford University founded Cisco in 1984.

• Fujitsu

Fujitsu is the leading Japanese global information and communication technology company, providing a vast array of products, solutions, and services. By connecting people, technology, and ideas, we create a more sustainable world where anyone can pursue their aspirations.

• Vodafone

Vodafone Group Plc provides services in the field of telecommunications. It concentrates on small and medium-sized businesses, large and multinational corporations, and transport services. In addition to communications, cloud and hosting, Internet of Things, security, and fixed connectivity, the company plans to invest in growth markets such as cloud and hosting, Internet of Things, security, and fixed connectivity.

• Verizon

Verizon, as one of the world's leading providers of technology, communications, information, and entertainment products, is revolutionizing how people, businesses, and objects connect having the ability to learn and develop at the rate of technological advancement, as well as the space to innovate in every role.

• Aruba

Aruba, a division of Hewlett Packard Enterprise, is a leading provider of network access solutions for the mobile enterprise. Mobility-Defined Networks are designed and delivered by the company to empower IT departments and GenMobile, a new generation of tech-savvy users who rely on mobile devices for every aspect of work and personal communication.

• Mojo Networks

Mojo Networks offers a cloud-managed WiFi access solution provider. It provides wifi platform to enterprises that can be scalable and secure. Their clients include major brands such as Citrix, Pinkberry, and the U.S. Senate. It also provide features such as graphical troubleshooting, WiFi user analytics, and social engagement.

• Ruckus Wireless

RUCKUS Networks designs and deploys purpose-built networks that can withstand the demanding conditions of the industries we serve. RUCKUS provides high-performance wireless LAN, wired LAN, IoT, assurance, and security solutions that enable exceptional connection experiences for visitors, students, citizens, and employees. Hardware of the highest caliber and AI-driven software reduce complexity and improve business outcomes for the most demanding industries on the planet.

• Cisco Systems
• Fujitsu
• Vodafone
• Verizon
• Ruckus Wireless
• Aruba
• Mojo Networks
• Purple
• Others.

Segmentation Analysis:

The global Networking Services Market is segmented on the basis of type, enterprise, application, industry vertical and region.

By Type Outlook:

In 2021, the WANaaS segment held the largest revenue share at approximately 65.0%. It is anticipated to have the highest CAGR over the forecast period, at 33.6%. It is a cloud-based wide area network (WAN) model intended to replace hardware-based legacy WAN. It employs difficult-to-manage connectivity protocols such as multiprotocol label switching (MLPS). WANaaS replaces hardware appliances due to its cloud-based delivery. Using a simple internet connection and software, Verticals can configure WAN. WANaaS is a specialized managed service suited for large to mid-sized businesses because it enables rapid deployments, improves user productivity and experience, and reduces costs.

LANaaS is anticipated to experience a CAGR of 31.6% over the forecast period. LANaaS is a networking business model that integrates LAN with ever-changing enterprise/business needs. It provides a scalable infrastructure at reduced hardware costs without requiring complex processes, multi-vendor support, comprehensive monitoring, and Ethernet and Wi-Fi support for multiple sites. LANaaS simplifies and secures the local network, improves the user experience, and ensures optimal wired and wireless connections through zero-touch application deployment.

• WANaaS
• LANaaS

By Enterprise:

In 2021, the segment of large enterprises dominated with a revenue share of over 52.0%. It is anticipated to increase at a CAGR of 31.3% over the forecast period. Rapid adoption of cloud services such as PaaS, SaaS, PaaS, and IaaS is credited with the growth. Large organizations are adopting cloud services for data storage and data centers for mobile workloads. In addition, the growing demand for a subscription-based business model in cloud computing, NFV, and SDN has accelerated the adoption of NaaS by large organizations.

The segment of small and medium-sized enterprises is anticipated to grow at a CAGR of 34.5% over the forecast period. NaaS permits SMBs to organize their networks, maintain their security systems, and monitor their personnel. SMBs prioritize digital transformation to achieve dependable, quick, and secure networks and to eliminate on-premises hardware connectivity appliances. SMEs are more likely to adopt NaaS because it improves the quality of services (QoS) and ensures network security. In addition, emerging technologies like SDN, IoT, and cloud-based services are in greater demand due to the emergence of affordable cloud services and the as-a-service model.

• Large Enterprises
• SMEs

By Application:

In 2021, the cloud and SaaS connectivity segment held the highest revenue share at over 24%. It is anticipated to increase at a CAGR of 33.6% during the period of forecast. The adoption of cloud-based solutions is fueled by the expanding use of technology and consumer preference for the cloud. Cloud-based services and solutions enable remote data access for Verticals. It enables scalability, migration, mobility, and data recovery, while enhancing efficiency. The organizations can achieve enhanced scaling, network assurance, and time-to-value at cost-effective rates, resulting in the widespread adoption of cloud-based solutions.

Bandwidth on Demand (BoD) is projected to grow at a CAGR of 34.6% over the forecast period. Bandwidth on Demand provides the required bandwidth to improve the user experience, simplifies the interface for creating service requests, and enables the application developer to integrate QoS resources. With automated provisioning and optimized network capacity planning, it increases agility. In addition to reducing the complexity and cost of network operations, it offers competitive services over an optimized and scalable transport software-defined network. BoD complies with service-level agreements, identifies and resolves problems, maintains procedures, and expedites network configuration.

• UCaaS/Video Conferencing
• Cloud and SaaS Connectivity
• Virtualized Private Network (VPN)
• Bandwidth on Demand
• Multi-Branch Connectivity
• WAN Optimization

By Industry Vertical:

In 2021, information technology (IT) and telecommunication accounted for 24.0% of total revenue. It is anticipated that its CAGR will be 33.1% during the forecast period. Increasing use-cases and the adoption of cloud services and IT infrastructure are responsible for the expansion. Network infrastructure plays a crucial role in the IT & telecommunications industry because it reduces the digital divide by delivering quick network services and addressing the issues of bandwidth scarcity at reasonable prices. During the forecast period, the manufacturing segment is anticipated to grow at a substantial CAGR of 34.9%. The market for the manufacturing segment is expanding as players in this segment deploy NaaS solutions in order to maximize their benefits and concentrate on their core activities rather than on their complex networking infrastructure. Demand for dependable and secure networking solutions is boosting NaaS adoption in this market.

The shared active and passive infrastructure enables profitable network expansion and high-speed internet access. Network-as-a-service (NaaS) solutions are essential components of the 5G network, and the telecommunications industry is expected to see widespread adoption of the NaaS platform.

• BFSI
• Retail
• IT & Telecommunication
• Manufacturing
• Media and Entertainment
• Education
• Healthcare
• Government
• Others

Regional Insights:

The report forecasts revenue growth at the global, regional, and country levels from 2017 to 2030 and analyzes recent industry trends in each subsegment.

As a result of the rapid adoption of network-as-a-service solutions, North America will account for the largest revenue share in 2021, at over 38.0%. The presence of key players such as Palo Alto, Amdocs, Megaport, Akamai, and Cisco Systems Inc. is the primary growth driver for the market. Significant corporations are heavily investing in data center research and development, and network infrastructure is contributing to this growth.

Europe is an additional significant networking services market, with countries such as the United Kingdom, Germany, and France driving regional expansion. The rising popularity of cloud computing and the need for more secure networking solutions are anticipated to drive the expansion of the European market.

The Asia-Pacific region is anticipated to experience the most rapid growth in the networking services market, driven by China and India's increasing adoption of networking technologies. It is anticipated that the expansion of the region's e-commerce sector will also increase demand for networking services.

• North America
  • US
  • Canada
  • Mexico
  • Rest of North America
• Europe
  • Germany
  • France
  • Italy
  • Spain
  • UK
  • Nordic Countries
    • Denmark
    • Finland
    • Iceland
    • Sweden
    • Norway
  • Benelux Union
    • Belgium
    • The Netherlands
    • Luxembourg
  • Rest of Europe
• Asia-Pacific
  • Japan
  • China
  • India
  • Australia
  • South Korea
  • Southeast Asia
    • Indonesia
    • Thailand
    • Malaysia
    • Singapore
    • Rest of Southeast Asia
  • Rest of Asia-Pacific
• The Middle East & Africa
  • Saudi Arabia
  • UAE
  • Egypt
  • South Africa
  • Rest of the Middle East & Africa
• Latin America
  • Brazil
  • Argentina
  • Rest of Latin America

Scope of Report:

Conclusion:

• The report discusses the major market participants involved in the market, including Market participants, raw material suppliers, equipment suppliers, end users, traders, distributors, and others.
• Detailed information about the companies is provided. In addition, the report details their capacity, production, price, revenue, cost, gross, gross margin, sales volume, sales revenue, consumption, growth rate, import, export, supply, future strategies, and technological advancements.
• The market's growth factors are discussed in depth, and the market's various end users are described in depth.