The global out of band authentication market was valued at $443.81 million in 2019, and it is expected to reach a value of $846.80 million by 2025, registering a CAGR of 11.37% over the forecast period 2020 – 2025, according to ResearchAndMarkets.
Digitalization and advancement of technology have increased the number of connected devices that have fueled the frequency of cyber-attacks and boosted the adoption of authentication solutions and services by governments and enterprises.
Rapid penetration of consumer electronics such as laptops, tablets, smartphones, and smart gadgets has increased the usability of the various internet-based solutions and services across the world. For instance, in 2019, the global internet users reached 4.38 billion, and unique mobile users stood at 5.1 billion. It has forced the services providers to opt-out of band authentication solutions to prevent any compromise of their services in the future.
Moreover, growing cloud adoption across most enterprises and the growth of emerging technologies, such as artificial intelligence, big data, and blockchain across various end-users have also impelled the market.
Widespread BYOD adoption raising security concerns
Additionally, widespread adoption of portable own devices in a modern work environment provides flexibility, reduces IT costs and enhances employee’s productivity. Due to this, there is a sudden spike in the number of businesses implementing enterprise mobility solutions that enable and encourage employees to work at any time, anywhere, from a wide range of devices.
Some studies show that BYOD approach lets employees utilize the benefits of greater flexibility, collaboration, and work-life balance to improve productivity by up to 34%.
However, it also raised security-related issues which are expected to drive the out of band authentication market as many enterprises are increasingly adopting software solution that generates one-time passcodes (OTPs) and sent using via email or SMS text message to establish a secure connection to secure their networks from the security threats.
BFSI segment expected to witness significant growth and drive the market
Increasing internet penetration, growing m-commerce market, and early adoption of online payment services is expected to drive the out of band authentication market, which is often used in financial institutions and other organizations with high-security requirements.
Most financial institutions are utilizing various forms of out of band authentication methods, for instance, voiceprint technology used to provide biometric verification by the user or the user is asked to text a code displayed after login from their registered smartphone to the institution.
It secures the communications with only a slight increase in complexity for a user. Moreover, the methods are also much cheaper to financial institutions to deploy than security key fobs or more complex biometric methods and hence, are expected to drive the market.
In addition, the number of security concerns associated with mobile payments is on the rise and is expected to compel the market growth.
North America to experience significant growth and drive the market
North America is expected to hold a prominent share in the out of band Authentication market owing to the increase in the number of IoT and connected devices and vulnerabilities associated with them are some of the factors driving the adoption of OOBA solutions and services.
The out of band authentication market is concentrated and is dominated by a few significant players like NortonLifeLock, Cisco Systems, Censornet, Deepnet Security and Early Warning Services.
These major players, with a prominent share in the market, are focusing on expanding their customer base across foreign countries. These companies are leveraging strategic collaborative initiatives to increase their market share and increase their profitability.
However, with technological advancements and product innovations, mid-size to smaller companies are growing their market presence by securing new contracts and by tapping new markets.