Adaptive Authentication Market

Adaptive Authentication Market Outlook (2023 to 2033)

According to Future Market Insights, the global adaptive authentication market size had reached US$ 14.6 Billion in 2018. Demand for adaptive authentication recorded Y-o-Y growth of 11.5% in 2022, and thus, the global market is expected to reach US$ 24.9 Billion in 2023. Over the projection period 2023 to 2033, adaptive authentication solutions sales in the region are projected to exhibit 13.1% CAGR and total a market size of US$ 85.5 Billion by 2033-end.

The market growth is being propelled by increasing need for authorizing the user’s login, payment credentials to eliminate the probability of a potential fraud. These concerns have raise the demand for adaptive authentication solutions across various industries as organizations strive to strengthen their security posture, comply with regulations, and provide a seamless user experience while mitigating evolving cybersecurity threats.

Adaptive authentication solutions leverage existing infrastructure and utilizes software-based authentication methods, thereby reducing the overall implementation and maintenance costs.

Other Drivers Propelling the Demand for Adaptive Authentication include:

• The rise in sophisticated cyber threats, including data breaches, identity theft, and account takeovers, has necessitated the adoption of stronger authentication measures.
• A seamless and frictionless user experience by adjusting the authentication process based on risk factors, reducing the need for repetitive or excessive authentication steps.
• Allowing organizations to verify user identities and protect sensitive data in mobile apps, cloud-based applications, and remote access scenarios.
• Organizations requirements to secure digital interactions, authenticate users across multiple channels, and protect critical assets in a dynamic and evolving digital landscape.

Challenges for Companies /Manufacturers in the Adaptive Authentication Market:

• Adaptive authentication involves collecting and analyzing user data to assess risk and make authentication decisions.
• There is a risk of false positives, where legitimate users are incorrectly flagged as high-risk, leading to unnecessary additional authentication steps.
• Users may find adaptive authentication burdensome or inconvenient to go through extra authentication measures, affecting their overall experience.
• Cybercriminals continuously develop new techniques to bypass authentication mechanisms, making it essential for adaptive authentication solutions to stay ahead of emerging threats.

Opportunities in the Adaptive Authentication Industry:

• The integration of advanced biometric technologies, such as facial recognition, voice recognition, and behavioral biometrics, presents significant opportunities for adaptive authentication.
• As the number of IoT devices continues to grow, there is a need for adaptive authentication solutions that can secure access to these devices and protect the data they generate.
• With the increasing adoption of cloud-based services and the migration of applications and infrastructure to the cloud, there is a demand for adaptive authentication solutions tailored for cloud environments.
• Behavioral analytics within adaptive authentication can provide deeper insights into user behavior patterns and help detect anomalies or suspicious activities.

Latest Trends in the Adaptive Authentication Market:

• The trend towards password less authentication is gaining momentum. Passwords are prone to vulnerabilities and can be easily compromised. Password less authentication methods, such as biometrics authentication are setting a trend for adaptive authentication.
• The trend risk based authentication is towards refining and enhancing risk assessment models by incorporating advanced analytics, machine learning, and artificial intelligence.
• Contextual intelligence plays a crucial role in the adaptive authentication. Gathering comprehensive contextual data, such as geolocation, IP reputation, device information, and user behavior, to build a more accurate profile of the authentication attempt.
• Integration of adaptive authentication with identity and access management (IAM) solutions is becoming more prevalent. This trend allows organizations to have a unified approach to managing user identities, access control, and authentication.

2018 to 2022 Adaptive Authentication Demand Outlook Compared to 2023 to 2033 Forecast

From 2018 to 2022, the global adaptive authentication market experienced a CAGR of 13.1%, reaching a market size of US$ 24.9 Billion in 2023.

From 2018 to 2022, the global adaptive authentication industry witnessed inclined growth due to rising number of sophisticated cyber threats, including data breaches, identity theft, and account takeovers. Numerous organizations are increasingly recognizing the need for stronger authentication measures to protect their sensitive data and mitigate the risks associated with these threats.

Future Forecast for Adaptive Authentication Industry

Looking ahead, the global adaptive authentication industry is expected to rise at a CAGR of 13.1% from 2023 to 2033. During the forecast period, the market size is expected to reach US$ 85.5 Billion.

The adaptive authentication industry is expected to continue its growth course from 2023 to 2033, driven by increasing demand for multi factor authentication (MFA) solutions that will help industries such as BFSI, healthcare and IT& telecommunications. The growth of the identity access management and continuous technological advancements are expected to drive the demand for adaptive authentication during the forecast period.

The market has potential for a significant growth in the Asia Pacific region due to the massive adoption of adaptive authentication in countries such as China, South Korea and India. However, some adaptive authentication can raise question for personal data of the users while undergoing adaptive authentication.

Sudip Saha

Principal Consultant

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Country-Wise Insights

Adaptive Authentication Market to Surge in the United States amid Growing Innovation in New Digital Technologies

The adaptive authentication industry in the United States is expected to reach a market share of US$ 10.4 Billion by 2033, expanding at a CAGR of 25.7%. The growth of the United States economy is being propelled by the growing innovation and implementation of new digital technologies to meet market demands and remain competitive.

The emergence of numerous complex cyber-attacks in private, public, and government sectors within the United Stated presents significant challenges to its progress. Additionally, there are other factors expected to drive the growth for adaptive authentication in the country are:

• Adaptive authentication has competence to mitigate to eliminate the chances burglary, credential theft and misuses and keeping track of the user’s pattern.
• The country has the capacity and expertise to conduct advanced technology and use cases in the field of adaptive authentication.

Enhancement of Robust Authentication Process Is Propelling the Market for Adaptive Authentication

The adaptive authentication industry in the United Kingdom is expected to reach a market share of US$ 8.8 Billion, expanding at a CAGR of 23.5% during the forecast period. The United Kingdom market is projected to experience growth by leveraging adaptive authentication, the United Kingdom is able to enhance security measures and ensure a robust authentication process for various applications. This approach allows for dynamic and intelligent authentication, adapting to different risk levels and user behaviors.

Notable Growth Expected in China's Adaptive Authentication Market is on a Surge to Eliminate Vulnerability of Identity Theft

The adaptive authentication industry in China is anticipated to reach a market share of US$ 9.6 Billion, moving at a CAGR of 27.4% during the forecast period. The adaptive authentication industry in China is expected to grow remarkably due to China's rapid digital transformation and widespread adoption of online services and e-commerce have created a vast ecosystem of digital identities and transactions. This increased reliance on digital platforms has also made individuals and organizations more vulnerable to identity theft and fraudulent activities.

Deploying Advanced Technologies to Peak Business Processes is driving the Market Growth in South Korea

The adaptive authentication industry in South Korea is estimated to reach a market share of US$ 7.7 Billion by 2033, thriving at a CAGR of 25.9%. The market in South Korea is predicted to grow because solution integrators based in South Korea are actively searching for innovative software technologies from around the world to enhance their business performance. In order to support its robust manufacturing sector, the country requires industrial software solutions that are safeguarded by security measures, such as authentication solutions, to counter cyber-attacks.

Demand for Adaptive Authentication Due to Prior Ransomware Assaults is driving the Market Growth in India

The adaptive authentication industry in India is expected to reach a market share of US$ 6.3 Billion, expanding at a CAGR of 29.2% during the forecast period. The market in India is likely to witness growth due to, the country has encountered a high incidence of severe server breaches, ransomware assaults, and other advanced cyber-attacks affecting various sectors such as telecommunications, information technology, banking, healthcare, retail, and e-commerce.

Category-Wise Insights

OTP (One-Time Password) Tokens Segment is Propelling the Adaptive Authentication Market with 13.7% CAGR through 2033

The OTP (One-Time Password) tokens segment is expected to dominate the adaptive authentication industry with a CAGR of 13.7% from 2023 to 2033. This segment captures a significant market share in 2023 due to its additional layer of security.

OTP (One-Time Password) tokens authentication is playing a significant role in driving the adaptive authentication market. OTP tokens are a form of two-factor authentication (2FA) that provide an additional layer of security beyond traditional username and password combinations. They generate unique passwords or codes that expire after a single use, adding an extra level of protection against unauthorized access.

How the Cloud-based Deployment is driving the Adaptive Authentication Market?

The cloud-based segment is expected to dominate the adaptive authentication industry with a market share of 54.1% from 2023 to 2033. This segment captures a significant market share in 2023 due to its scalability across the network infrastructure.

Cloud-based deployment offers the advantage of scalability, allowing organizations to easily adjust resources and accommodate varying levels of demand. This scalability is particularly beneficial for adaptive authentication systems, as they need to handle fluctuating user volumes and authentication requests.

How Key Players Stay Competitive in the Adaptive Authentication Industry?

The adaptive authentication industry is highly competitive, with numerous players vying for market share. In such a scenario, key players must adopt effective strategies to stay ahead of the competition.

Key Strategies Adopted by the Players

• Product Innovation

Companies invest in research and development to enhance authentication technologies such as biometrics, behavioral analytics, machine learning, and artificial intelligence. They strive to develop more accurate, secure, and user-friendly authentication solutions.

• Strategic Partnerships and Collaborations

Companies collaborate with technology providers specializing in areas such as biometrics, machine learning, and mobile security to integrate their solutions and offer more comprehensive adaptive authentication offerings. Companies collaborate with industry associations, standards bodies, and regulatory authorities to influence standards, share knowledge, and collectively address emerging challenges in adaptive authentication.

• Expansion into Emerging Markets

Companies conduct extensive market research to understand the specific needs and preferences of emerging markets. They localize their products, adapt pricing models, and ensure compliance with local regulations to effectively cater to these markets. Companies invest in building local infrastructure, including data centers and cloud services, to ensure reliable and low-latency service delivery in emerging markets.

• Mergers and Acquisitions

Companies acquire technology startups or companies specializing in specific authentication technologies to enhance their product portfolio and accelerate innovation. Larger companies acquire smaller players to strengthen their market position and expand their customer base. Mergers and acquisitions help consolidate resources, expertise, and customer relationships.

Key Players in the Adaptive Authentication Industry

• RSA Security LLC
• IBM
• Okta
• Cisco
• Ping Identity

Key Developments in the Adaptive Authentication Market:

• ForgeRock, a provider of digital identity management solutions, has recently secured $93.5 million in equity financing. The company's CEO, Fran Rosch, stated that this new funding would empower ForgeRock to make strategic investments in research and development, cloud infrastructure, global sales efforts, and the promotion of both new and existing solutions. These investments will particularly focus on advancing their AI tools and further strengthening their offerings in the market.
• OneLogin, a prominent IAM provider, has introduced its Delegated Administration solution. This offering allows organizations to embrace the Zero Trust approach by granting least privilege access. With the ability to delegate access at a detailed level, IT administrators can strike a balance between productivity and robust security measures, safeguarding the organization from potential threats.
• One Identity, a prominent player in unified identity security, has acquired OneLogin, a leading provider of Identity Access Management (IAM) solutions. This acquisition aims to broaden the capabilities of One Identity's Unified Identity Security Platform. By integrating with its existing offerings, One Identity now offers customers a comprehensive and trusted approach to identity security across all major categories.

Segmentation Analysis of the Adaptive Authentication Market

By Authentication:

• Password Based
• OTP Token
• Biometric Based

By Deployment Mode:

• Cloud-based
• On-premises

By Industry:

• IT & Telecommunication
• BFSI
• Government
• Healthcare
• E-commerce
• Others

By Region:

• North America
• Latin America
• Europe
• East Asia
• South Asia
• Middle East & Africa