Why Should Investors Be Paying Attention To Software As A Service? International Business Machines Corp. (NYSE:IBM), Oracle Corporation (NYSE:ORCL), Iddriven Inc (OTCMKTS:IDDR), & Microsoft Corporation (NASDAQ:MSFT

Global “Software as a Service” (SaaS) revenue is expected to increase more than 20% year over year to a whopping $106 billion in 2016 according to Goldman Sachs, with North America accounting for a significant share of the market as they prove a widespread use of SaaS apps across a variety of verticals. The dynamics of the company create opportunities for small, agile companies to build their market share and expand. International markets, though, may see the highest growth rates moving forward. SaaS security applications enable IT to eliminate a good deal of on-premises hardware and software. This facilitates the process by cutting out the need for a big upfront investment right off the bat. We’ll discuss how companies like International Business Machines Corp. (NYSE:IBM)Oracle Corporation (NYSE:ORCL), Iddriven Inc (OTCMKTS:IDDR), and Microsoft Corporation (NASDAQ:MSFT).

Implementing SaaS also takes away the need for unnecessary upgrades and new implementations. Instead, all the hardware and software are managed by your security SaaS provider, behind the scenes. Others aim to completely take over the end-to-end management of your applications and data. According to a 2016 report on the state of SaaS-based security, 1,400 have popped up in the past five years alone, with subscriptions for IT, business intelligence, enterprise vertical applications and SaaS-based security continuing on a rise.

Software as a Service has grown to become the latest trend within the business world, making buying and installing programs onto a computer a thing of the past. Given the growth of this software licensing and delivery model, it is important to get a grip on what is trending. As of 2016, according to Tech.co, 81 percent of the surveyed companies got a maximum of 20 percent of new revenue from existing customers in the form of upselling and expansion sales. SaaS companies with a faster growth have better results in terms of churn and upsell, a trend that has been concluded accurately over the past two years. Over 50% of companies surveyed in a recent MarketsandMarkets research report assigned the biggest portion of their budget for customer retention costs, with an increasing focus on the ideas of focusing on building teams rather than on developing their infrastructure.

The SaaS market is still in its infancy and proves to hold maximum potential for future growth as businesses move towards a cloud-based system. Public markets are currently valuing SaaS businesses at about 4.5 times run rate revenue. The identity and access management (IAM) market are expected to grow from USD 7.20 Billion in 2015 to USD 12.78 Billion by 2020, at a Compound Annual Growth Rate (CAGR) of 12.2% during the forecast period, according to the same MarketsandMarkets survey. Growing emphasis on management, increasing mobility trends, telecommunications, public, and critical infrastructure sectors are the main drivers driving the growth in identity and access management market.

SaaS is becoming increasingly popular, and as the industry develops, more and more companies are dropping their traditional business models and moving in favor of these new technology solutions. One of the benefits of the SaaS model are that it is easier to administrate, all users will have the same version of the software because updates will be done automatically, and therefore collaboration will be made easier.

Also, it will grant global accessibility, making remote work models easier, which helps in reducing costs as well as in improving performance. As more and more SaaS products are integrating marketplace dynamics into their business models, the prevalence of these products is becoming a necessity for further expansion of their companies. Instead of companies installing software on their own servers, software providers host the software at theirs and charge them according to the time they spent using it, for a simple monthly fee. Identity Access Management is a framework for business processes that facilitates the management of electronic identities. The framework includes the technology needed to support identity management. This technology can be utilized to initiate, capture, and manage user identities and their related access permissions in an automated manner.

Thus, this ensures that access privileges are granted according to one interpretation of policy and all individuals and services are properly authenticated and authorized. With the ever-evolving business environment, it can become difficult to keep track of as employees migrate through different roles in an organization, while also managing identity and access. While North America had captured the largest market share in 2015 for IAM, Asia-Pacific is the fastest growing region in terms of CAGR. Factors that affect a company’s decisions to switch to the innovative cloud-based business model for IAM solutions are increasing internet usage, compliance regulation, and mobile usage.

An increasing number of enterprises and industries are spearheading the technology implementation in terms of mobility, cloud computing, hosting services for a variety of sources, leading to increased customer base and internet users, leading to the surge necessity for IAM solutions. Currently, companies like International Business Machines Corp. (NYSE:IBM)Oracle Corporation (NYSE:ORCL)Microsoft Corporation (NASDAQ:MSFT), and Dell make up a significant portion of the identity and access management sector, building off of the “Software as a Service” mentality. Smaller companies have also entered the space at a time when the mergers and acquisitions climate is beginning to heat up. Companies like Iddriven Inc (OTCMKTS:IDDR) and CRM are competing for the lion’s share in the market, providing innovative solutions for day-to-day business environments. Specifically, IDdriven has recently been building its international footprint through new, leading channel partnerships that will allow for further integration of IDdriven’s IDaaS solution with Microsoft’s Identity Manager Software, thanks to interface software funded and developed by companies like Oxford Computer Group.

The trends are in favor for Identity Access Management as well as SaaS solutions, and the global surge towards a cloud-based business environment facilitates the market growth for these solutions. The new, integrated next-generation identity management platforms provide breakthrough scalability with an industry-leading suite of identity management solutions. According to an IDC study, SaaS delivery will significantly outpace traditional software product delivery, growing nearly five times faster than the traditional software market and becoming a significant driver for functional software markets.

Forecasts hold a positive outlook for these solutions, pointing to future successes, with new developments and improvements being made daily for a competitive advantage on the market. The future bodes well for SaaS and IAM solutions, with opportunities for growth as more companies move towards cloud-based environments.

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