The Disaster Recovery as a Service (DRaaS) Market has registered a CAGR of 12% over the forecast period 2021 - 2026. The pandemic was marked with nationwide lockdown across the world, with companies being forced to be pushed to work remotely. The increased dependency on the security of data measures was brought to light by several data breaches and an increase in cyberattacks. Furthermore, ransomware attacks have increased significantly during the pandemic, which has underlined the need for disaster recovery solutions to prevent downtime of systems that could result in severe losses for organizations.
- According to VMWare, in a 2020 analyst survey, 76% of respondents reported an incident during the past two years that required an IT Disaster Recovery (DR) plan, while more than 50% reported at least two incidents. At the same time, cyberattacks are on the rise, increasing business risk. In 2019, 52% of global enterprise network security decision-makers experienced at least one sensitive data breach in the12 months. And in September 2020, security researchers reported a seven-fold year-on-year increase in ransomware reports, thus, increasing the traction of disaster recovery solutions.
- The combination of decreasing IT budgets and headcount and the increasing complexity of IT infrastructure and most corporate computing environments include SaaS applications, cloud workloads, mobile workers, and vastly increasing volumes of data to protect and result in data losses and downtime. Growth in using the cloud for long-term storage or also archiving increased dramatically over the past few years. Compliance mandates and state / federal regulations require certain data records to be kept for periods between five years and perpetuity.
- The players in the market are expected to increase market capture and reduce customer friction by offering enhanced onboarding options and additional capabilities in support of various recovery targets, platforms supported (i.e., beyond VMware and physical x86), and multinational support and bolster DRaaS solutions with built-in add-ons like automated recovery testing and change management assurance.
- The DRaaS market consists of multiple players, each with varying abilities to support requirements. These can relate to workload types, geographies, scale, onboarding, and ongoing support levels, the number of recovery point objective (RPO) and recovery time objective (RTO) options, and target recovery locations. The provider may deliver services as a fully managed, assisted-recovery, or self-service offering.
- On the other hand, customers may face problems if they are unaware of what they have in their data centers. They must be aware of their various IT assets and how their criticality translates into the service tiers of a DRaaS provider. The service provider's replication method will generally give different recovery periods at other price points. The most costly tier may offer workload recovery in seconds or minutes. In contrast, the mid-tier may offer a 4-to-8-hour enterprise workload recovery time, and the least expensive tier may offer a 24-to-48-hour recovery.
Key Market Trends
BFSI is One of the Significant Factor Driving the Market
- BFSI sector is poised to significantly adopt DRaaS solutions because financial institutions such as commercial banks and credit unions build their reputations around an ability to provide consistent and uninterrupted service to their customers. Any system downtime could damage these reputations and potentially lead to lost customers. The usage of DRaaS solutions could provide instant recovery of data, applications, and systems.
- Critical sectors, like banking, are expected to adopt cloud-based deployment of services increasingly. This is due to the IT sector's continuing quest for optimized infrastructure and the ability of solution builders to source application and infrastructure components from multiple providers to construct a hybrid cloud-based solution, thereby augmenting the studied market growth.
- Most financial institution-specific cloud recovery vendors will inspect and upgrade their cloud infrastructure to ensure compliance, auditing, and financial sector standards are met. These regulatory modifications benefit smaller institutions that lack the resources to commit employee time to meet compliance criteria.
- With the aim to secure their IT processes and systems, secure customer critical data, and comply with government regulations, both private and public organizations are increasingly focused on implementing the latest technologies to prevent cyber attacks. Also, with greater customer expectations, growing technological capabilities, and regulatory requirements, banking institutions are being pushed to adopt a proactive approach to security.
- Some of the most common malware attacks that the banking industry faces include signature-less and file-less malware, which does not behave like other malicious programs but can instead exploit native processes to hide their activities.
North America to Witness Moderate Growth
- The United States is one of the largest markets for DRaaS solutions globally. The country is the early adopter of digital transformation strategies that have led multiple end-users to become more vulnerable to cyber attacks, which has created the demand for a secure storage and recovery network. The country houses prominent players in the market such as IBM, Recovery Point, Sungard Availability Services, etc.
- With such an increasing number of data breaches in the country, both the public and private sectors are inclining to spend more toward cyber solutions to study these attacks and take preventive measures. The recent US budget has endorsed USD 19 billion for cybersecurity-related initiatives. End-users in the region are refocusing on organizational resiliency and minimizing downtime; enterprises of all sizes are looking for off-premise ways to implement disaster recovery.
- Multiple ransomware attacks are being centered around the United States. In July 2021, between 800 and 1,500 businesses worldwide were affected by a ransomware attack centered on the United States information technology firm Kaseya. The US Department of Justice recently announced to elevate investigations of ransomware attacks to a similar priority as terrorism, which showcases the severity of ransomware attacks in the country.
- Zerto acts as a vendor for more than 350 Managed Service Providers and 9,000 customers to provide disaster recovery, ransomware protection, and data and application mobility across hybrid, multi-cloud environments. The addition of Zerto is expected to accelerate HPE’s R&D talent roadmap and HPE’s transformation to become a prominent data management and protection provider to customers. Zerto will benefit by utilizing HPE’s distribution channel, global presence, and installed base.
- According to the Identity Theft Resource Center, the annual number of data breaches were 1,001, and 155.8 million records were exposed in the United States in 2020, whereas, in 2019, the total number of data breaches was 1,473 and records exposed were 164.7 million, which were considerably higher in comparison to 2020.
The DRaaS market is moderately competitive and consists of several major players. In terms of market share, few of the players currently dominate the market. However, with innovation in data storage and security systems, the companies are increasing their market presence by securing new contracts and tapping the emerging markets.
- May 2021 - Wanclouds, a multi-cloud SaaS and managed service provider launched its Multi-Cloud Disaster Recovery as a Service at KubeCon + CloudNativeCon Europe 2021. The company’s DRaaS solution reduces the financial investment and technical complexities that often halt or delay businesses from setting up disaster recovery protections and ensuring compliance requirements as extreme weather and cybersecurity risks increasingly threaten business continuity.
- October 2020 - Sungard Availability Services (Sungard AS), one of the leading providers of highly available, cloud-connected infrastructure in North America and Europe, has announced a new Private Cloud solution as the centerpiece of its end-to-end Connected Cloud ecosystem. Sungard AS Private Cloud offers a solution engineered to expand with customers at the speed they need to grow, with flexible minimum commitments and on-demand scalability, as enterprises explore methods to drive digital transformation within their operations.
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
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1.2 Scope of the Study
4.2 Industry Attractiveness - Porter's Five Forces Analysis
4.2.1 Bargaining Power of Suppliers
4.2.2 Bargaining Power of Consumers
4.2.3 Threat of New Entrants
4.2.4 Intensity of Competitive Rivalry
4.2.5 Threat of Substitute Products
4.3 Assessment of Impact of COVID-19 on the Market
4.4 Technology Snapshot
4.4.1 Fully Managed
4.4.3 Self Service
5.1.1 Increasing Data Breach and Ransomware Attacks Creating a Need For Robust Data Protection Solutions
5.1.2 Reducing Operational Cost of DRaaS Solutions Compared to Traditional Solutions
5.2 Market Restraints
5.2.1 Complexity of Deployment and Setting Terms
6.1.5 Other End-user Verticals
6.2.1 North America
6.2.3 Asia Pacific
6.2.4 Rest of the World
7.1.1 iLand Internet Solutions Corporation
7.1.2 Microsoft Corporation
7.1.3 Recovery Point Systems Inc.
7.1.4 Evolve IP LLC
7.1.5 TierPoint LLC
7.1.6 IBM Corporation
7.1.7 Sungard Availability Services LP
7.1.8 C and W Business Ltd
7.1.9 Expedient Holdings USA LLC
7.1.11 Intervision Systems LLC
7.1.12 Phoenixnap LLC
7.1.13 Flexential Colorado Corp.
A selection of companies mentioned in this report includes:
- iLand Internet Solutions Corporation
- Microsoft Corporation
- Recovery Point Systems Inc.
- Evolve IP LLC
- TierPoint LLC
- IBM Corporation
- Sungard Availability Services LP
- C and W Business Ltd
- Expedient Holdings USA LLC
- Intervision Systems LLC
- Phoenixnap LLC
- Flexential Colorado Corp.