The global SaaS market size was valued at USD 165.9 billion in 2021 and is anticipated to expand at a compound annual growth rate (CAGR) of 11.0% from 2022 to 2028. Software as a Service (SaaS) is a cloud service that provides software applications virtually through the internet. The rising adoption of public cloud services across enterprises is one of the major factors that propel the market growth during the forecast period. The growing shift of enterprises towards SaaS from an on-premises model owing to the high cost of the on-premises software deployment is further projected to propel the growth of the market for SaaS over the forecast period. However, the concern related to data privacy and security related to the public cloud is projected to hinder the market growth.
The significant increase in the adoption of emails, instant messaging applications, and video calls encourages the demand for smart devices among end-users. This, in turn, is projected to contribute to the growth of the market for SaaS. Through SaaS applications, people can connect from everywhere apart from offices therefore, the growing trend towards work from home across the globe is further projected to provide ample opportunities for the growth of the market for SaaS in the near future. Additionally, the growing demand for business outsourcing in enterprises further propels market growth over the forecast period.
The COVID-19 outbreak further positively impacted the market for SaaS as many of the enterprises opted for cloud software platforms during the lockdown. The lockdown imposed by the government has led to substantial growth in the adoption of cloud software platform services such as SaaS across various enterprises. The increased use of public cloud services during work from home has reinforced SaaS adoption for the virtual management of the work in enterprises. Therefore, the significant increase in the adoption of third-party software services across the globe during the pandemic further augmented the growth of the market for SaaS.
The enterprise software segment dominated the market for SaaS and accounted for a revenue share of over 70.0% in 2021. The growth of the market is attributed to the rising trend toward the deployment of cloud software applications in small and medium enterprises. Various major players such as IBM Corp., Microsoft Corp. Salesforce, and others are providing advanced enterprise SaaS to the companies and further contributed significantly to the market share. Additionally, the high expenditure toward business outsourcing in enterprises further contributed to the highest market share of the segment.
The productivity software segment is forecast to grow with a significant CAGR of 10.6% over the forecast period. The market for SaaS is mainly driven due to the growing demand for productivity software in small organizations as this software service allows enterprises to become office less. Moreover, the significant availability of productivity applications for mobile applications such as calendar functions, emails, and note-taking, further contributes to the growth of the market for SaaS over the forecast period. Additionally, the growing adoption of productivity SaaS for data analytics among enterprises provides ample growth to the market for SaaS during the forecast period.
In Asia Pacific, the market for SaaS is expected to witness the highest CAGR of 12.1% from 2022 to 2028. China and India are positively contributing to the growth of the market owing to the growing demand for outsourcing of cloud-based software coupled with the rising number of small and medium enterprises outsourcing across the region. The SMEs significantly outsource cloud-based software platforms for reducing the cost of on-premises software deployment. Moreover, the significant growth in the IT industry is further expected to offer ample opportunity to the market. Moreover, the growing number of secured internet servers in China, Japan, and India further augmented the growth of the market for SaaS during the forecast period.
North America is projected to hold a major market share of around 50.0% in 2021. The U.S. is positively contributing to the growth of market revenue. The presence of well-established market players such as Salesforce, Microsoft Corp., Google LLC, IBM Corp., and others is one of the driving factors for market growth. Moreover, the developed IT infrastructure increases the easy deployment of cloud-based virtual services in the region, thereby contributing to the major share in the SaaS market. Moreover, the significant expenditure on the cloud infrastructure coupled with the availability of a high number of secured internet servers further contributed to the highest market share. Furthermore, innovations in mobile applications and the introduction of various smart devices can be attributed to the market dominance in the region.
The SaaS industry is always changing and updating. The key market players tend to launch new strategies more frequently to stay head-on in the market for SaaS. Moreover, the companies are focusing on increasing investments in the advancement of cloud services to increase the customer base in the market. Moreover, major players are targeting new regions and geographies to increase the revenue from the industry, by either entering the new market solely or by collaborating with local companies across the globe. Some of the prominent players in the SaaS market include:
Adobe Inc.
Microsoft Corp.
Alibaba Cloud
IBM Corp.
Google LLC
Salesforce
Oracle Corp.
SAP SE
Rackspace Technology, Inc.
VMware Inc.
IONOS Cloud Inc.
Cisco Systems, Inc.
Atlassian
ServiceNow
Report Attribute |
Details |
Market size value in 2022 |
USD 186.6 billion |
Revenue forecast in 2028 |
USD 344.3 billion |
Growth rate |
CAGR of 11.0% from 2022 to 2028 |
Base year for estimation |
2021 |
Historical data |
2017 - 2020 |
Forecast period |
2022 - 2028 |
Quantitative units |
Revenue in USD million and CAGR from 2022 to 2028 |
Report coverage |
Revenue forecast, company ranking, competitive landscape, growth factors, and trends |
Segments covered |
Type, region |
Regional scope |
North America; Europe; Asia Pacific; Central & South America; Middle East & Africa |
Country scope |
U.S.; Germany; France, U.K.; China; India; Japan; Brazil; South Africa |
Key companies profiled |
Adobe Inc., Microsoft Corp., Alibaba Cloud, IBM Corp., Google LLC, Salesforce, Oracle Corp., SAP SE, Rackspace Technology, Inc., VMware Inc., IONOS Cloud Inc., Cisco Systems, Inc., Atlassian, and ServiceNow. |
Customization scope |
Free report customization (equivalent up to 8 analysts’ working days) with purchase. Addition or alteration to country, regional & segment scope. |
Pricing and purchase options |
Avail customized purchase options to meet your exact research needs. Explore purchase options |
This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2028. For this study, Grand View Research has segmented the global SaaS market report based on type and region:
Type Outlook (Revenue, USD Million, 2017 - 2028)
Enterprise Software
Productivity Software
Regional Outlook (Revenue, USD Million, 2017 - 2028)
North America
U.S.
Europe
Germany
France
U.K.
Asia Pacific
China
India
Japan
Central & South America
Brazil
Middle East & Africa
South Africa
b. The global SaaS market size was estimated at USD 165.9 billion in 2021 and is expected to reach USD 186.6 billion in 2022.
b. The global SaaS market is expected to grow at a compound annual growth rate of 11.0% from 2022 to 2028 to reach USD 344.3 billion by 2028.
b. North America dominated the SaaS market with a share of 49.9% in 2021. This is attributable to the developed IT infrastructure which increases the easy deployment of cloud-based virtual services and the significant expenditure on the cloud infrastructure coupled with the availability of high number of secured internet servers.
b. Some key players operating in the SaaS market include Adobe Inc.; Microsoft Corp.; Alibaba Cloud; IBM Corp.; Google LLC; Salesforce; Oracle Corp.; SAP SE; Rackspace Technology, Inc.; and VMware Inc.
b. Key factors that are driving the SaaS market growth include the rising adoption of public cloud services across enterprises and the growing shift of enterprises towards SaaS from an on-premises model owing to the high cost of the on-premises software deployment across the globe.
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