Identity as a Service (IDaaS) Market to Reach US$42.2 Billion by 2031, Growing at 24.69% CAGR | Public Cloud Dominates as Cybercriminals Target Government and Enterprise Data | DataM Intelligence

Leander, Texas and Tokyo, Japan - Dec 02, 2025
According to DataM Intelligence, the global Identity as a Service (IDaaS) market was valued at approximately US$9.0 billion in 2024 and is projected to reach an estimated US$42.2 billion by 2031, growing at a Compound Annual Growth Rate (CAGR) of approximately 24.69% during the forecast period (2024-2031). This explosive growth is propelled by increasing cyber threats and data breaches, rapid digital transformation across industries, stringent regulatory compliance requirements, growing adoption of cloud services, and the shift toward zero-trust security architectures.

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Report Details:
• No. of Pages: 180
• Forecast Period: 2024-2031
• Market Size (2024): $9.0 Billion
• Market Size (2031): $42.2 Billion
• Compound Annual Growth Rate: 24.69%
• Regions Covered: Global

Global Recent Developments:
✅ November 2025: Microsoft and Okta announced a deepened strategic partnership, integrating Azure AD with Okta's Identity Cloud to offer a unified public cloud IDaaS platform, specifically hardened against state-sponsored attacks targeting government agencies.
✅ November 2025: Google Cloud unveiled "Chronicle IDaaS," leveraging its Mandiant threat intelligence to offer a public cloud identity service with predictive breach detection, specifically analyzing patterns from known government-targeting cybercriminal groups.
✅ October 2025: The U.S. Cybersecurity and Infrastructure Security Agency (CISA) mandated the adoption of cloud-based Identity, Credential, and Access Management (ICAM) solutions for all federal civilian agencies, following a major breach, driving massive public cloud IDaaS procurement.
✅ October 2025: A global consortium of banks, including JPMorgan Chase and HSBC, partnered with IBM Security to deploy a shared, public cloud-based identity fraud detection network using AI to identify credential-stuffing attacks in real-time.
✅ September 2025: Ping Identity launched "Government Identity Cloud," a FedRAMP High-authorized public cloud service featuring quantum-resistant cryptography and behavioral analytics to counter advanced persistent threats (APTs).

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Competitive Landscape
The market features intense competition between global cloud providers, specialized cybersecurity firms, and identity management pioneers.

1. Microsoft Corporation maintained market leadership with 28% global market share, expanding their Azure Active Directory portfolio and reporting 35% revenue growth in 2024-2025 through government and enterprise contracts.
2. Okta, Inc. captured 24% market share in independent IDaaS solutions, securing long-term agreements with large enterprises and achieving 40% growth through best-of-breed adoption.
3. Ping Identity dominated the customer identity and access management segment with 20% market share, reporting 38% growth through API security and CIAM solutions.
4. IBM Security led the regulated industry segment with 18% market share, achieving 32% growth through integrated security services and consulting.
5. Google LLC expanded their cloud identity offerings with 16% market share, focusing on AI-driven threat detection with 45% revenue growth.

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Segmentation Analysis
By Deployment Type
• The public Cloud is the largest market shareholder with 58% revenue share in 2024, projected to grow at 26.5% CAGR, valued for its scalability, rapid deployment, reduced operational overhead, continuous security updates, and critical adoption as cybercriminals routinely target government agencies to access sensitive government data, driving public sector and enterprise migration to secure, centrally managed cloud identity platforms with advanced threat intelligence and compliance automation.
• Hybrid Cloud shows accelerated growth with 28% revenue share in 2024, expected to grow at 23.5% CAGR, preferred for organizations balancing cloud agility with on-premises legacy system integration.
• Private Cloud demonstrates steady demand with 14% revenue share in 2024 for highly regulated industries with specific data residency requirements.

By Component Type
• Single Sign-On (SSO) represents the largest segment with 32% revenue share in 2024, growing at 25.8% CAGR, driven by user experience demands, productivity improvement, password fatigue reduction, essential role in secure application access, and foundational component for zero-trust security models requiring centralized authentication and authorization across diverse cloud and on-premises environments.
• Advanced Authentication shows robust growth with 25% revenue share in 2024, expanding at 28.5% CAGR, valued for multi-factor authentication, biometrics, and risk-based adaptive authentication.
• Audit, Compliance, and Governance demonstrates significant expansion with 22% revenue share in 2024 through regulatory pressure and security oversight needs.

By End-User
• Banking, Financial Services, and Insurance (BFSI) commands the largest share with 30% revenue share in 2024, growing at 26.2% CAGR, driven by extreme regulatory scrutiny (e.g., PSD2, GDPR), high-value cyber attack targets, digital banking transformation, essential need for customer identity assurance, and comprehensive requirements for fraud prevention, secure customer access, and internal privileged access management across complex, hybrid IT environments.
• Public Sector shows explosive growth with 28% revenue share in 2024, expanding at 30.5% CAGR, valued for digital citizen services, critical infrastructure protection, and mandate-driven security modernization.
• Telecom and IT demonstrates strong adoption with 20% revenue share in 2024 for managing vast user bases and partner ecosystems.

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Regional Analysis:
North America holds the largest market share with 48% revenue share in 2024, driven by early and aggressive adoption of cloud technologies, high concentration of global enterprises and technology firms, stringent regulatory environment, significant cybersecurity spending, and advanced threat landscape requiring sophisticated identity protection across the United States and Canada.

Asia-Pacific emerges as the fastest-growing region, projected to expand at 29.5% CAGR through 2031, fueled by rapid digitalization, expanding SME adoption of cloud services, increasing government focus on national cybersecurity, growing e-commerce and fintech sectors, and rising awareness of identity-related fraud across China, India, Japan, and Southeast Asian countries.

Market Trends & Drivers
The Identity as a Service Market is experiencing explosive growth driven by the cybersecurity imperative, digital acceleration, regulatory complexity, and architectural shift to cloud and zero-trust. Key trends include the convergence of CIAM and workforce identity, growth of passwordless and biometric authentication, advancement in AI/ML for behavioral analytics and threat detection, expansion of identity governance and administration (IGA) capabilities, and increasing focus on decentralized identity and blockchain-based solutions. The security evolution, cloud migration, and regulatory pressure are significantly contributing to market growth.

Related Reports:
1. Cloud Security Market - https://www.datamintelligence.com/research-report/cloud-security-market?jd
2. Identity and Access Management Market - https://www.datamintelligence.com/research-report/identity-and-access-management-market?jd
3. Zero Trust Security Market - https://www.datamintelligence.com/research-report/zero-trust-security-market?jd

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Sai Kiran
DataM Intelligence 4market Research LLP
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Email: Sai.k@datamintelligence.com

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