Analytics As a Service Market by Component (Solutions and Services), Analytics Type (Predictive Analytics, Prescriptive Analytics, Diagnostic Analytics, Descriptive Analytics), and by Region (North America, Europe, Asia Pacific, Middle East and Africa, and South America), Global Forecast 2021 to 2031

Market Analysis and Insights

The global Analytics as a Service market was worth USD 10257.76 million in 2022 and is expected to grow at a 35.93% CAGR during the forecast period, reaching USD 64707.69 million by 2031

Manufacturing, healthcare, retail anyalytics, and finance are just a few of the industries embracing AaaS. AaaS vendors are creating sector-specific solutions to address the distinct analytics demands of each business. Industry-wide acceptance is promoting market expansion. Additionally, one of the factors boosting market expansion is the rise in enterprises' requirement to analyze social media data for their own unique objectives. IBM, for instance, provides social merchandising and market insights utilizing Twitter data for sectors like retail and media & entertainment.

Analytics as a Service Market Scope :

Market Definition

The phrase ""Analytics as a Service"" (AaaS) describes the delivery of analytics capabilities and services to businesses via a cloud-based platform or a third-party service provider.
It entails contracting with a specialized service provider to handle the analytics process, including data administration, analysis, and insight development.

In analytics as a service, businesses use the knowledge, resources, and equipment of the service provider to carry out data analytics activities. The service provider often provides a variety of analytics services, including reporting, data integration, data storage, processing, and visualization.

AaaS enables businesses to quickly and effectively increase their analytics capabilities. They can readily adapt to changing data quantities and processing demands without making significant infrastructure investments or adding a lot of extra staff.

Organizations can lower the up-front expenses of constructing and maintaining an in-house analytics infrastructure by utilizing a service provider's infrastructure and expertise. It is an economical solution because they pay for the services via a subscription or usage-based basis.

Key Market Segmentation

Insights on Components

The solution segment remains at the top.

Solutions and services are part of the component-based market segmentation for analytics as a service. In terms of revenue, the Analytics as a Service market was dominated by the solution segment in 2022. The ability of firms to boost operational effectiveness and cut expenses is what is responsible for this market segment's expansion. Companies are implementing solutions and services since doing so facilitates managing, forecasting, and data analysis for better decision-making.

Insights on Analytics Type

The Predictive Segment Valued for the Highest Share

The predictive segment held the biggest market share in 2022, per an examination of the analytics as a service business. In order to analyze previous data and forecast future results, predictive analytics employs cutting-edge methods like machine learning and statistical algorithms. The market for predictive analytics as a service (PAaaS) is expanding quickly as more businesses want to use predictive analytics to achieve a competitive advantage. Companies may rapidly and easily acquire predictive analytics capabilities by utilizing PAaaS solutions without having to make significant upfront hardware and software expenditures.

Insights on the Region

The North American region accounted for the highest share.

The North American Analytics as a Service market, which is projected to reach USD 2.98 billion in 2022, is anticipated to rise at a substantial CAGR. This is because a number of associations and organizations in the region, including the Cloud Native Computing Foundation and the National Association of Cloud Technologists, advocate the use of cloud computing to deploy a number of high-tech solutions, including advanced analytics, big data analytics, and predictive analytics. The rise of the regional market is also signaled by the collaboration of numerous healthcare companies and governmental organizations to create analytics solutions for the healthcare sector.

Key Company Profiles

Some key players in the global market are Atos, Cloudera Inc., International Business Machines Corporation, Hewlett Packard Enterprise Company, Google LLC (Alphabet Inc.), Infosys Limited, Microsoft Corporation, Sisense, Teradata Corporation, Oracle Corporation, ScienceSoft USA Corporation, and Tibco Software Inc.

COVID-19 Impact and Market Status

The epidemic has brought to light the value of data analytics in comprehending and adapting to the dynamics of businesses and markets that are undergoing rapid change.

Businesses from all sectors have realized how important real-time information is for making wise choices and adjusting to the changing environment. The need for AaaS solutions that provide advanced analytics capabilities to extract valuable insights from sizable and complicated datasets has risen as a result. Many organizations have been driven by the epidemic to speed up their digital transformation efforts in order to deal with distant labor, shifting customer behavior, and interrupted supply networks. In order to facilitate remote collaboration, data sharing, and analytics capabilities, cloud-based analytics platforms and AaaS solutions have seen a spike in use. The demand for AaaS services has grown as businesses look for flexible and scalable analytics solutions.

Organizations have modified their analytics strategies in response to the pandemic's shift in business objectives. In order to forecast future trends, simulate situations, and make data-driven decisions in uncertain times, there has been a push toward more predictive and prescriptive analytics. In order to satisfy their clients' changing analytics demands, AaaS suppliers have had to modify their solutions.

Latest Trends

1. Analytics capabilities are being integrated directly into other software programs, platforms, or goods by AaaS suppliers. This trend eliminates the need for separate analytics tools or interfaces by enabling organizations to obtain real-time information within their current operations. Without having to move between various programs, embedded analytics facilitates smooth decision-making and provides users with actionable insights.

2. More sophisticated and automated analytics capabilities are being enabled by the incorporation of AI and ML techniques into AaaS platforms. Large datasets may be analyzed using AI-powered analytics, which can also provide prediction models and actionable insights. Organizations can now find hidden trends and use data-driven choices more effectively thanks to this trend.

3. By making it possible for users to engage with analytics systems and conduct natural language queries, NLP technologies are being leveraged to improve user experiences. Users can utilize conversational analytics to ask queries or issue instructions, and the system will answer with pertinent insights or visualizations. This trend makes analytics easier to use and opens up data insights to a larger audience of consumers.

4. In order to deliver simple and engaging visual representations of data, AaaS systems are concentrating on improving data visualization capabilities. This trend places a strong emphasis on interactive dashboards, infographics, and narrative methods that let users successfully explore and share data. The objective is to make difficult data visually appealing and intelligible so that better decisions may be made.

Significant Growth Factors

Businesses in all sectors are realizing the importance of data analytics for boosting revenue, streamlining processes, and obtaining a competitive edge.

The need for AaaS solutions is being driven by the expanding amount of data and the requirement to derive useful insights from it. The expansion of the AaaS business has been aided by the growing use of cloud computing. Organizations benefit from the scalability, flexibility, and cost-effectiveness that cloud-based analytics tools provide. Organizations may use AaaS with minimal up-front costs because of the cloud's simple access to analytics tools, data storage, and processing capacity.

The analytics industry has undergone a transformation because of developments in AI and machine learning. These technologies are being incorporated into solutions by AaaS providers, enabling automated data processing, predictive analytics, and the creation of insightful data. The adoption of AaaS by organizations is being driven by the capacity to utilize AI capabilities.

To acquire insights into consumer behavior, market trends, operational efficiency, and risk management, businesses are depending more and more on data-driven decision-making. AaaS solutions give organizations the knowledge and tools they need to collect, analyze, and visualize data, enabling them to make wise choices.

Restraining Factors 

As the use of data analytics grows, protecting data privacy and security is essential. Concerns about disclosing sensitive information to independent AaaS providers may exist inside organizations. Data breaches and compliance problems may limit the AaaS market's expansion.

It might be difficult to integrate AaaS solutions into current IT infrastructures and operations. Organizations must make sure that legacy systems, data sources, and other analytics tools are seamlessly integrated. Integration difficulties may impede the uptake and expansion of AaaS.

Data analytics calls for specialized knowledge and abilities. Finding and maintaining individuals with the appropriate capabilities to use AaaS efficiently may be difficult for certain organizations. The market's expansion may be hampered by a lack of qualified workers.
For useful analytics, the data must be accurate, thorough, and readily available. Data quality, data governance, and access to pertinent and trustworthy data sources may pose issues for organizations. AaaS systems may perform less effectively if there is insufficient data.

Recent Developments in the Global Analytics-as-a-Service Market: A Snapshot

Kyndryl announced the extension of its strategic alliance with SAP in April 2022 in order to help clients through the obstacles of the digital revolution. As part of the extended partnership, Kyndryl will offer services that complete the RISE with an SAP solution, including tried-and-true migration tools and scalable options, AI-driven corporate data management and analytics solutions, application modernization, and more.