The market for Network as a Service is expected to grow to more than $100 billion by 2030. North America currently dominates the market and accounts for the largest share of the market. Companies like Megaport and Cloudflare have emerged as major players in the market. North America is also expected to grow at a significant CAGR during the forecast period.
Fixed telephony accounts for the largest share of the network as a service market
The global market for network as a service will reach more than $1 trillion by 2030, according to research conducted by Juniper Research. This growth is driven by consumer demand for higher-speed internet. Despite the current economic situation, the market is expected to remain healthy throughout the next decade. The main focus of the market will be the rollout of fiber to the home and infrastructure upgrades.
North America is expected to be the largest region during the forecast period, with Canada and the US accounting for a large share of the regional market. However, the Asia Pacific region is expected to experience the highest CAGR during this period, driven by the increasing popularity of cloud-based services.
Network as a service is a way for organizations to access network infrastructure without having to invest in equipment and personnel. It is available as a subscription, and is available through flexible operating expense models. The growing demand for on-demand ports and Wi-Fi hotspots are also expected to fuel the growth of this market.
North America dominates the market
North America is the dominant region for the Network as a Service market and is forecast to continue dominating the market over the next seven years. This region’s growth is attributed to the early adoption of advanced technology solutions and prominent initiatives by industry players. Increasing adoption of cloud computing and advanced IT infrastructure are the primary factors driving North America’s market growth. In addition, North America has a higher concentration of vendors providing network virtualization solutions. Some of these vendors include AT&T, Verizon, and Juniper Networks.
The network as a service market in North America is dominated by the US. However, Canada is also expected to witness substantial growth during the forecast period. Moreover, the market for the Network as a Service in North America is expected to grow at a CAGR of 48.7% over the forecast period.
Several major players in the market are actively pursuing new services and development strategies. For instance, Cisco and Verizon Business recently announced a partnership that will extend to 2021. The new partnership will help both companies enhance their existing service offerings.
In the last quarter, Cloudflare reported strong revenue growth. Revenue grew by 54% year over year, beating estimates by 6%. The company also raised its full year revenue guidance by 46%, from $730 million to $957 million. Revenue growth was primarily driven by higher renewal rates, higher dollar-based net retention, and higher customer spending of $100K or more.
The company is spending heavily on marketing and sales to increase customer acquisition. The company is seeing an impressive 25% compound annual growth in new customer acquisition over the past four years, which suggests a strong long-term outlook. Cloudflare’s CFO also mentioned that the company has an opportunity to move to annual billing engagements for enterprise customers, a tactic that many of its peers are already adopting. This move would allow the company to recognize cash flow more quickly than if the business were charging by the month.
The growth thesis for Cloudflare is still intact, despite its high valuation and high risks. It has the potential to become a much larger provider of software, network services, and security services. This would further justify its high valuation.
Megaport’s innovative network as a service platform is helping companies accelerate their digital transformation. It offers secure, fast connectivity on a pay-as-you-go basis with no set-up fees. Megaport’s SaaS model has helped the company grow its recurring revenue base. Besides connecting companies, Megaport also offers other services to help customers manage the complexity of their IT networks.
Megaport is a leading NaaS provider in the world. It has a global Software Defined Network (SDN) offering that helps companies connect their branches to the cloud. This enables companies to host and extend their network functions closer to the edge without investing in hardware.
Megaport has a team of highly-skilled professionals to provide its clients with the right service. For example, its Chief Financial Officer, Vincent McLaughlin, has 15 years of experience leading financial operations for various organisations. Previously, he held positions at Telstra International, Mandoe Media, and Firstwave. He has extensive experience in finance, operations, and mergers and acquisitions.