PCaaS Market

Market Overview

The global PCaaS market size was worth USD 28 billion in 2021. It is predicted to reach an expected value of USD 430 billion by 2030, registering a CAGR of 35.5% during the forecast period (2022-2030).

 One of the essential elements of a business' infrastructure is personal computers. The expense and difficulty of managing the regular PC lifespan are expected to rise in the upcoming years due to technological improvement. Businesses strive to provide high-quality services while keeping infrastructure costs low. PC as a Service is one current remedy that can deal with this problem (PCaaS).

Due to increased IT investment and an emphasis on business support applications, the market is growing. The fundamental forces driving demand in the market under research are the adoption of PCaaS by small- and medium-sized organizations (SMEs) and the growing desire to reduce the costs and workload associated with IT staffing.

Market Dynamics

Global PCaaS Market Drivers

Increasing Demand from Small and Medium-scale Organizations Due to Cost Benefit

According to a Techaisle poll, 32% of SMEs know intentions to implement PC-as-a-Service (PCaaS), and 9% of SMEs have already adopted PCaaS. The use of PCaaS was primarily motivated by the desire to acquire cutting-edge technology, the ability to minimize the strain of IT support, and predictable pricing. In the 500–999 employee size sectors, awareness of PCaaS rises from a low of 21% (unweighted) among small firms to a high of 64%.

There is a global need for PCs due to SMEs adopting digital technology more and more. According to HP India, PC usage has increased as more users log in from their homes. The requirement for adoption was even more critical for SMBs since digitization levels were often on the lower side.

The get-what-you-need and pay-as-you-go financing models offered by the vendors make it suitable for SMEs with constraints related to spending. Thus, with the growth of technologies and support from vendors in the market, the adoption of PCaaS is growing in SMEs.

Renewed Focus on Managed Service Provider

The rapid growth of managed service providers pushes the development of the market. According to the 2021 Global MSP Benchmark Survey Report, half of the MSPs had an average monthly recurring rate (MRR) growth of more than 10% over the past three years. More than a quarter (28%) had an average MRR growth of around 6 to 10%.

Also, the most growing services in 2020 (in revenues) compared to 2019 included security (65%), cloud management (54%), infrastructure monitoring and management (52%), and desktop support (51%). Remarkably, the growth in the revenue of desktop support and infrastructure witnessed by the managed service providers leads to new opportunities for the market.

Small and medium enterprises widely appoint managed service providers to manage their IT infrastructure. The market's vendors are concentrating on helping MSPs meet demand from their small company clientele. Similarly, the firm said in October 2020 that it is assessing ways to construct a program stack to offer predictable, consistent earnings for the MSPs. The move is in line with the exponential growth of the Device as a Service. Lenovo's Intelligent Devices Group also announced plans to double down on its efforts to expand DaaS and other recurring revenue opportunities with partners.

Global PCaaS Market Restraint

Lack of Product Differentiation

Although PCaaS enhances customer experience, staff flexibility, and ROI, a lack of product diversification is an issue that restrains the market's expansion. The majority of market participants provide comparable advantages to customers, such as fixed monthly payments, PC lifecycle support, and increased productivity, among other things.

The similarities of the solutions offered and stagnant innovation practices to create a point of differentiation hinders the market's growth during the forecast period. Furthermore, an innovation to reduce complexity and a thorough process to identify the company's requirements for success has become essential factors when selecting a PCaaS partner. Innovation in the services also leads to a decline in the labor costs associated with end-user support services.

Global PCaaS Market Opportunities

Increased Adoption in Education Sector

According to estimates, the market will have new prospects for growth due to the education sector. The education industry has a significant need for the personal computer as a service market. The cost of acquiring new technologies can rise at many educational institutions. However, this sector can save expenses thanks to PC as a service. The personal computers as a service market offer several advantages, including no ownership requirements and lower pricing.

Today, technology is given top priority in many educational institutions. PC-based education is now a frequent practice. The education industry is benefiting from the introduction of digital tools. A wide range of opportunities will arise due to the sector's soaring demand. During the anticipated time, the market will expand significantly.

Regional Analysis

By Region, the global PCaaS market is segmented into North America, Europe, Asia-Pacific, and the Rest of the world. 

North America accounted for the largest market share and is estimated to grow at a CAGR of 31% during the forecast period. Being a forerunner in cloud adoption, the region has aided PCaaS and DaaS companies in utilizing the benefits of the cloud. As an illustration, VMware revealed its plans to launch the Managed Desktops Solution, a new DaaS service on the VMware Cloud on AWS. This should hasten the adoption of the technology over the anticipated time frame. Additionally, the area is home to some key players in the sector, including Microsoft, Dell EMC, and others. These companies are constantly investing in the advancement of technology through R&D, strategic alliances, and mergers and acquisitions, which has helped them establish a stronger position in the market. For instance, Apple Inc. introduced a new subscription service in November 2021 to assist small business owners in managing the Apple devices that their staff uses. The corporation might be able to provide device subscriptions for phones, laptops, and tablets to small business owners through this service. As demand was predicted to increase, such PCaaS services targeted smaller firms.

Asia-Pacific is the second largest region. It is estimated to reach an expected value of USD 280 billion by 2030, registering a CAGR of 42.6% during the forecast period. Asia-Pacific is one of the essential markets for PCaaS, owing to the positively developing consumer technology sector due to the work-from-home initiatives due to the pandemic.

Europe is the third largest region. Over one-third of UK companies, decision-makers say COVID-19's prompted them to significantly boost their digital transformation budgets, according to a poll published by Twilio in 2020. This adds to increased expenditure to serve a company's growing digital needs. For the same reason, organizations choose PCaaS instead of purchasing their devices and PC equipment to lower budgets. According to CyberCrew, even though 99% of UK citizens own a mobile device, smartphones are expected never to replace desktop and laptop computers, mainly because an average computer can run more robust software than smartphones. Moreover, with the growing impetus on small businesses in the country, the demand for personal computers as services is expected to rise.

Segmental Analysis

The global PCaaS market is segmented by deployment type, end-user Industry, and region. 

By Type, the global personal computer as a service market is segmented into Hardware, Software, and Services. The Services segment accounted for the largest market share and is estimated to grow at a CAGR of 36.6% during the forecast period. The services offered in PCaaS include maintenance, upgradation, and security, among others. IT maintenance is imperative for an IT system as it assists in securing the PC and provides smooth operations. PCaaS offers repair and maintenance services, letting the IT departments offload logistical and maintenance responsibilities and focus on more pressing tasks. The pandemic has led to a growth in the adoption and usage of PCs globally, leading to demand for maintenance machines to ensure business continuity. Also, in terms of hardware security, PCaaS tracks the locations and status of the hardware. This assists in mitigating the risks of stolen assets and ensuring business continuity. It can also include predictive analytics to help combat hardware failures and security policy violations. It boosts security further by inventorying devices. Such factors drive the growth of the services segment in the forecast period.

The hardware segment is the second largest. The cost of PCs, laptops, and printers is rising due to the worldwide semiconductor scarcity, and other gadgets like smartphones may follow suit. Major PC manufacturers such as HP and others have raised the prices of PCs and other devices in 2020-2021. According to HP, the increases were driven by component shortages, so the company may adjust prices further to reflect cost increases. The increase in hardware prices due to the chip shortage, expected to sustain in the coming years, makes PCaaS a profitable option for organizations. The aging PCs in organizations are leading to the growth in data breaches which further creates a need for new hardware.

By Deployment Type, the global personal computer as a service market is segmented into small and medium-scale and large organizations. The large organization's segment accounted for the largest market share and is estimated to grow at a CAGR of 30.1% during the forecast period. As larger organizations slowly get over initial apprehensions and adopt PCaaS, they are expected to constitute the larger consumer base, primarily owing to their pre-determined sizing differences and scaling patterns. The transition will also diffuse consumer hesitation, boosting adoption within the consumer segment and expanding the scope for the studied market.

By End-User Industry, the global personal computer as a service market is segmented into BFSI, healthcare and life sciences, IT and telecom, government and defense, education, and other end-user industries. The IT and telecom segment accounted for the largest market share and is estimated to grow at a CAGR of 36.8% during the forecast period. With the ownership and implementation of digital transformation, most digital transformation initiatives are driven by the IT sector. IT infrastructure is the primary digital transformation disruptor. Mainframes led to servers, which led to networks, which led to cloud hosting, which further led to hybrid environments. The growing complexity of IT infrastructure is increasing the need for enhanced PC lifecycle management solutions. According to the Cisco Annual Internet Report (2018–2023), the number of devices connected to IP networks is expected to be more than three times the global population by 2023. Also, more than 3.6 networked devices per capita are expected to exist by 2023, representing an increase from 2.4 networked devices per capita in 2018. Further, it is anticipated that there will be 29.3 billion networked devices by 2023, up from 18.4 billion in 2018. Such trends are expected to create scope for the expansion of the studied market.

The BFSI segment is the second largest. Financial institutions are increasingly contracting with outside companies to provide their operations and services. Banks have a wide range of business operations at their disposal to outsource, including payment processing and PC lifecycle management. Solutions like PCaaS provide hardware and services bundled in a low-cost monthly subscription model, which helps the banking institutions securely maintain their endpoints. Such factors propel the market growth. 

The healthcare segment is the third largest. PCaaS solutions help transform modern IT transformation for healthcare and bring life sciences from vision to reality by accelerating readiness and agility for this transformation. These solutions further help in expanding caregiver reach by delivering improved patient care delivery to a more considerable range of patients with the opportunity to offer upgraded services for new revenue streams. The storage of medical records and personal information on computers has made them more susceptible to cyberattacks. More information exchange is taking place due to personnel in the healthcare industry using more linked devices. It is, however, putting the goal at greater risk than ever. PCaaS solutions also help the secure patient and business data by providing comprehensive security for staff, network, endpoints, data, and recovery, by streamlining storage and hardware. According to Dell EMC, 68% of US hospitals run on Dell desktops and laptops, and 93% of US hospitals use VMware server virtualization. Hence, the demand for PCaaS solutions in the Industry is expected to witness an upward trend in the forecast period.

Recent Developments

• September 2022 - Intel will celebrate breaking ground in the Silicon Heartland at its newest US manufacturing site in 40 years.
• August 2022 - The capital-intensive semiconductor sector now has a new funding model thanks to Intel Corporation's groundbreaking Semiconductor Co-Investment Program (SCIP). One of the most prominent worldwide alternative asset managers, Brookfield Asset Management, and Intel have entered into a legally binding agreement as part of Intel's program that will give Intel access to a larger and newer pool of capital for industrial build-outs.