Identity and Access Management (IAM) is an essential component of IT security today, enabling organizations to control access to their systems and data by managing user identities, access entitlements and authentication. The importance of IAM continues to grow as cyber threats continue to evolve and data privacy regulations become more stringent.
According to a recent survey conducted by KuppingerCole Analysts, nearly 95% of organizations have an IAM solution in place. Most medium-sized to large organizations, factually, have multiples different IAM solutions in place for providing different IAM capabilities. This clearly shows the increasing importance of IAM in today's IT security.
Trends, facts and figures
The shift to cloud-based IAM solutions, also commonly referred to as IDaaS (Identity as a Service), which offer greater scalability, flexibility, and cost-effectiveness than traditional on-premises solutions, is one of the key trends driving the growth of the IAM market. As more organizations adopt cloud computing, IDaaS is gaining popularity. Moreover, integration of IAM with additional security solutions, such as Endpoint Protection, Detection and Response (EPDR) and Security Information and Event Management (SIEM) systems, is a trend. This integration enables organizations to adopt a more holistic security strategy by monitoring user activity across all systems and applications and detecting and responding to threats in real time. This demonstrates the importance of IAM within cybersecurity strategies.
The IAM market is expected to continue to grow at a rapid pace, driven by factors such as those mentioned above, but also others. Regulations require a strong Identity Governance and Administration (IGA) posture. Cybersecurity and Zero Trust initiatives drive the demand for advanced authentication mechanisms such as passwordless authentication and adaptive access controls. KuppingerCole Analysts predicts that the IAM market volume will reach 35.58 billion USD by 2025, representing a CAGR of 16.8%, which is a clear indicator of this strong market growth.
IAM solutions are relevant across the globe. The largest revenue share comes from North America and EMEA, which approximately have a similar share of the global market across the various IAM subsegments. A smaller portion comes from APAC and LATAM, which have lower adoption rates, but we expect to see significant growth in these regions in the coming years.
A closer look into IAM subsegments
IGA is a core component of IAM, focused on managing users and their access to systems and data in accordance with policies and regulations. This market is expected to expand in the coming years as organizations seek to streamline identity management processes and ensure compliance with privacy regulations such as GDPR and CCPA. In addition, IGA solutions have begun to leverage artificial intelligence and machine learning to automate identity-related tasks and increase productivity. It is possible to learn more about this market segment in the Leadership Compass published by KuppingerCole (Identity Governance and Administration 2022 | KuppingerCole).
Biometrics and adaptive access control is another growing area. The goal is to provide enhanced security and user experience over traditional password-based authentication. Their importance continues to grow in the context of Zero Trust initiative and for better protecting against cyberattacks targeting users, their digital identities, and credentials such as passwords.
Finally, Zero Trust security models are driving IAM adoption, requiring strong and continual authentication and authorization for verifying users and their devices. We also expect to see an increase in the adoption of decentralized identity solutions that allow users to reuse identities and associated identity proofs across multiple organizations, systems and applications. Warwick Ashford explained about the future using decentralized identity in his blog post (Gear Up for the Future with Decentralized Identity (kuppingercole.com).
We expect continued growth in all IAM subsegments. While some are expected to show a good and stable CAGR around 10% others are expected to grow significantly faster. At the upcoming EIC (European Identity Conference), which will take place in Berlin in mid-May, we have several tracks where we will discuss topics such as trends in IGA, maturity levels of Identity Fabrics and the challenges of moving to passwordless authentication. As every year, there will be plenty interesting sessions at EIC. Agenda | EIC 2023 (kuppingercole.com).