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Report predicts rise of Biometrics-as-a-Service amid sensor market growth

Global biometric sensor shipments are expected to reach 1.9 billion by 2022, a 12.4 percent CAGR from 2015, driven by consumer electronics, mobile payments, digital security, and identity management, according to a report by ABI Research.

“Monetizing Biometrics Technology through Silicon-as-a-Service Model” shows increased penetration rates across government, civil, banking, healthcare, and enterprise markets is expected to result in shipments of 31 million non-consumer biometric devices by 2022.

ABI predicts biometrics market revenue will increase from $26.6 billion in 2016 to $44.5 billion in 2022. Innovation in sensor technology is a central cause of this growth, according to the report, but the revenue share of sensors will remain small, not exceeding 7 percent in 2022.

The report points out that biometric sensor vendors face pressure from both vertical integrators using their own chip sets, and low-cost manufacturers offering off-the-shelf, general use sensors. Therefore, they will need to generate scale by addressing the needs of a variety of different use cases, and becoming an integral part of any services enabled by their product.

It discusses the potential of building solutions around sensors and offering them “as-a-service” as an alternative to a traditional business model based on hardware sales, and outlines a number of potential benefits of “Biometrics-as-a-Service” for hardware manufacturers and customers.

“SaaS allows biometrics suppliers to improve their profitability from the hardware, strengthen their value proposition by offering a number of value-added services over their biometrics solutions, differentiate their offering against low-cost biometrics suppliers, and strengthen loyalty with existing customers,” the report authors write. “However, SaaS is not without challenges for hardware vendors.”

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