LONDON--(BUSINESS WIRE)--Technavio market research analysts forecast the global network as a service (NaaS) market to grow at a CAGR of over 42% during the period 2018-2022, according to their latest report.
One of the major trends impacting the growth of the market is the penetration of cloud computing, which is at an all-time high. The adoption of cloud computing is increasing around the world because of its features such as cost-effectiveness, agility, and superior functionality. The adoption of cloud computing is anticipated to continue to increase during the forecast period. The rise in the penetration of the cloud phenomenon is a major trend that affects the adoption and proliferation of NaaS. NaaS is expected to find increasing acceptance when compared with traditional networking infrastructure due to its inherent features, including cost-effectiveness, security, compliance with standards, and ease of use. The traditional networking infrastructure, which is installed on-premises incurs high operational and maintenance costs for users. Cloud computing solutions solve most of these problems while allowing enterprises to focus on their core competencies.
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In this report, Technavio analysts highlight the growing acceptance of OPEX model as a key factor contributing to the growth of the global network as a service market:
Growing acceptance of OPEX model
With the increasing adoption of cloud computing and virtualization technology, enterprises and industries are switching from the CAPEX model to the OPEX model. This has increased further due to the tightening of IT budgets and streamlining of processes. This shift to the OPEX model allows enterprises to focus more on their business and strategic goals, rather than on networking equipment and infrastructure. Besides, cloud-based networking services are based on the pay-per-use or the pay-as-you-go model. In this model, buyers pay only for the resources and capacity used.
According to a senior analyst at Technavio for IT professional services, “Traditional networking implementation is based on high upfront capital expenditure. The OPEX model is a more cost-effective and flexible proposition that is highly attractive owing to its inherent operational efficiencies. The OPEX model reduces the cost of ownership and maintenance of the entire networking infrastructure drastically. The in-house costs are reduced, and operational limitations are eradicated with optimal resource allocation.”
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Global network as a service market segmentation
This market research report segments the global network as a service market into the following end-users (IT and telecom, BFSI, manufacturing, and healthcare) and key regions (the Americas, APAC, and EMEA). It provides an in-depth analysis of the prominent factors influencing the market, including drivers, opportunities, trends, and industry-specific challenges.
Of the four major end-users, the IT and telecom segment held the largest market share in 2017, accounting for more than 25% of the market. However, the market share for this application is expected to decrease by nearly 5% by 2022. However, this segment will dominate the market throughout the forecast period.
The Americas accounted for around 46% of the global NaaS market in 2017. The major factors that are responsible for the dominance of the Americas are the technological maturity in terms of data center and network infrastructure and the massive size and growth of the industrial and private sectors. The accelerated technology adoption, increased focus on IT productivity, and service delivery optimization are some of the other reasons contributing to the growth of the market in this region.
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