Globally, the IT industry is enduring an abysmal success rate of around 33 percent. With escalating losses to the tune of around US$80 billion, the Global TaaS Market is the new buzz word for making successful product launches.
As product testing moves towards new cloud-based delivery models, organizations are increasingly depending on it to reduce their IT budgets. While they focus more on core competencies to improve their business, product testing remains an aberration.
Owing to this, the Product Testing Services segment in the TaaS Market is expected to reach US$70.98 billion by 2018.
Product testing services are thus witnessing a tremendous surge in demand, as companies look to outsource services to a third-party service provider. This trend has given the product testing market a whole new breed of entrants ranging from independent companies to product development companies and even system integration services providers.
Currently, key product testing functionalities are performed in-house, which brings forth the huge gap in demand that is looking to be filled.
Technavio analysts bring you insights on four key market drivers, which are critical in driving global interest in product testing functions.
TaaS Can Reduce Operational Time and Cost
Testing, a critical function, is performed throughout the product development stage, and it constitutes as much as 50 percent of the overall product development cost. As a result, companies are hiring independent testing vendors, specializing in testing services.
By outsourcing, organizations need not invest in additional resources or be concerned with over utilizing limited available resources. While outsourcing helps them gain access to local talent and advanced technologies, it also helps them to maintain a lean staff.
Additionally, organizations are developing economical cost structures owing to cost reductions in investment areas such as: extra office space, equipment, and specialist training for the staff. Today, organizations are increasingly looking at concentrating more on their core.
Increased Utilization of TaaS Cloud Computing Technology
Another major driver of the market is the increased utilization of cloud computing technology. Enterprises across the globe have realized the importance of cloud computing technology as a means of reducing costs and improving their business processes.
Many organizations are adopting cloud technology following a shift from the capital-intensive model of buying and running software to sharing the applications provided by a third party.
A number of enterprises are replacing licensed software with TaaS-based testing applications to provide new product categories. The adoption of cloud technology enables organizations to gain access to a higher number of smart process applications, with various advantages such as lower cost, easy deployment, rapid scalability, easy access, uninterrupted services, and flexibility.
Thus, organizations now prefer providing smart applications through the cloud model instead of deploying licensed versions of the application.
Increased Adoption of TaaS for Mobile Devices
Adoption of mobile devices, such as smartphones and tablets, is growing at a phenomenal rate. In the next few years, these devices will completely supersede simpler phones in the market. As many businesses and consumers are relying on smartphones and tablets to perform their professional and personal tasks, there will be an increasing need for additional mobile applications.
These devices not only come in various forms but also run on different operating systems and have varied vendor interfaces. Therefore, to improve the performance of such devices while maintaining security and stability, mobile application testing has become a necessity, thus driving growth in the Global TaaS market.
Need to Comply with Stringent Regulations
The need to comply with stringent regulations is another major driver of this market. Increased regulatory compliance and expenses incurred in case of failure of software to comply with regulations has driven the need for testing services.
These increasing number of regulations in almost every sector has dramatically increased the need to certify products and services. As a result, companies have reallocated some investment from core business processes to fulfill compliance requirements. This too has attributed to an increase in IT decision makers to seek automated compliance tools for certification to help improve operational efficiencies.
