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Identity-as-a-Service
(IdaaS)

In the beginning, platforms hosting and providing identity-as-a-service solutions revolved around the practice of identity federation to web-based applications. True Identity as a Service (IDaaS) was introduced by Microsoft. Being the market leader of on-premises identity providers over the last two decades, the only competition to Microsoft's Active Directory (AD) was OpenLDAP, a free open-source implementation of the Lightweight Directory Access Protocol. While managing LINUX systems with AD was difficult, OpenLDAP effortlessly served as a stronger candidate, because it was modeled to handle platforms with greater technicalities.

The introduction of next-generation IDaaS (also known as directory-as-a-service, or DaaS) was the solution that addressed system complexities. It consolidated the functions of a cloud-identity provider through functions like the safe management and federation of identities of users to their systems, which include both cloud and on-premises applications. DaaS supported both multi-factor authentication (MFA) and single sign-on (SSO). Apart from MFA and SSO, the provision of centralized user-management was one of the most advantageous aspects of the next-gen IDaaS. All of these functions and provisions were available in a single application and via the next gen IDaaS, organizations no longer had to separately manage AD, OpenLDAP, and SSO.

Gartner defines IDaaS as, “a predominantly cloud-based service in a multi-tenant or dedicated and hosted delivery model that brokers core identity governance and administration (IGA), access and intelligence functions to target systems on customers' premises and in the cloud.”

What's the current identity security landscape?

In the current identity security landscape, a comprehensive identity and access management (IAM) solution should be in place for the surveillance and protection of users and data.

Expectedly, COVID-19 was responsible for fast-tracking the digital transformation of many businesses. A primary consequence of this growth is the introduction and enforcement of advanced solutions like IDaaS for greater security, and the refinement of information privacy. The following are some of the most radical driving and restraining factors of the IDaaS market:

Driving factor 1: Escalating frauds in identity and authentication

There is no way to stop cybercrimes entirely, and that cybercrimes are growing in complexity is undeniable. The monetary loss due to cybercrime and fraud was estimated at USD 4.3 trillion in 2019. Many organizations perceive these threats as real and frightening, and this has fueled the growth of the IDaaS model and cybersecurity efforts as a whole. Organizations that decide to adopt IDaaS have been more effective at preventing scams and monetary loss.

Restraining factor 1: Inadequate protection of consumer data

Banking applications are used worldwide and a breach in any industry can have severe consequences. Although advanced technologies have been implemented in the Banking, Financial Services and Insurance sector, the concern about endpoint protection has never been greater across all industries. Endpoint protection, which includes mobile phones, tablets, desktops, laptops, etc., is directly connected to the growing user-base of employees and customers. This leads to a higher amount of transactions and greater transactional complexities.

Driving factor 2: Inception of new data compliance laws and regulations

The use of data in any form is now governed by several rigid regulatory laws, and organizations can only collect and use data if they can achieve regulatory compliance with the laws based on region. To respect and safeguard the privacy of consumers, these laws dictate the ethical standards for organizations in the collection and use of consumer data. For instance, if an audited organization is found to be in violation of the GDPR, it can face a fine up to 10 million euros or 2% of their preceding year's global turnover, depending on whichever is higher.

Restraining factor 2: Human and technical error

This factor is usually inevitable. A service outage is a serious problem on multiple levels: data access is locked, business operations are put on hold, extra resources are needed to invest in a remedy, and clients experience a loss as they cannot access the services anymore. In addition, it's not the security of just the primary organization that users might be concerned about, but also of any service provider's who, by extension, have specific access and are granted a level of trust with client data.

Need for IDaaS

In essence, IDaaS is another method of protection relating to user-identities. It provides the secure authorization of users and keeps cybercriminals at bay by limiting their options to break into critical organizational systems.

Moreover, the current industrial age, which has given birth to Industry 4.0 or 4IR (fourth industrial revolution; conceptualizing rapidly changing technological, industrial and societal composition and operations owing to inter-connectivity inflation and smart automation), which mainly consists of integrated or unified technological systems spinning alongside the primary trend, big data analytics. From a statistical standpoint, the global industry 4.0 market is projected to grow

  • Cloud-based security In the current evolving security landscape, cloud security has been gaining considerable traction due to increasing ransomware and phishing attacks. The IBM 2022 study. found that 11% of the total breaches in 2022 were ransomware attacks, which amounts to a growth of 41% from 7.8% in 2021, while 51% of organizations reported that phishing is the most common method that attackers use to acquire real cloud credentials.
  • IDaaS is a cloud-based service and the outsourcing of certain account passwords and credentials can be tracked by the identity providers rather than the organizations themselves. Implementing MFA becomes an easier task as the specialists (identity providers) handle the known identities while the organization is free from technical issues while implementing security measures for the cloud.
  • Integration The identification of the right IAM solution can aid organizational and access management. The retention and maintenance of identity control, independent from where it's deployed, is possible by enforcing a unified system that can manage not only on-premises resources, but also digital resources.
  • Become all-seeing and all-knowing
  • Have the absolute power to rule
  • Undertake organizational empowerment

Capabilities of IDaaS

Implementation and integration of IDaaS means that both parties, the businesses and their customers, enjoy the satisfaction of successful protection of organizational data and consumer privacy. Moreover, for the end users (customers), IDaaS allows them to use a single set of credentials to access several services, thereby, removing the troublesome task of remembering several credentials. As a result, the total number of user accounts to be managed by the IT admins is drastically reduced, enabling them to focus on other tasks.

Depending on the market segment, the functionalities offered by IDaaS solutions might differ. Regardless, all IDaaS solutions have an underlying goal of delivering digital identity and access management. The general components of a typical IDaaS solution include:

  • Multi-tenant and cloud-based architectonics
  • Management of passwords and authentication
  • SSO
  • MFA
  • Automation of approval-based workflows
  • Intelligent knowledge and analytics
  • Command, control, and comply

How to choose an IDaaS vendor?

Several vendors provide IDaaS capabilities, and each comes with its own strengths. Businesses can find it challenging to select the best IDaaS provider for its unique needs.

It's vital to ensure that the options considered compare favorably to these:

  • Cloud-native vs cloud-compatible: IDaaS revolves around delivering solutions from the cloud. Although all of them are cloud-based, there is a clear distinction between cloud-adapted and cloud-created platforms. Additionally, while cloud-compatible solutions were later developed to accommodate on-premises solutions, cloud-native solutions were designed to have zero limitations in their cloud capabilities.
  • Storage of core identities via SSO: Due to mass digital transformation, users now need to be able to access resources on the cloud through a wide array of solutions that are not based on AD. Owing to this progression, the creation and use of unauthorized accounts has drastically increased in separate core-identities, which is a big cybersecurity risk. The solution to this risk of instability is SSO.
  • Platform independent: The current industrial inclinations and developments bolster heterogeneous environments (operating across a mix of different and multiple platforms that are closely knit together) in contrast to the previously dominant homogeneous environments. The IDaaS solutions should be platform independent, or in other words, should not care what applications or resources that need identity security are based on and where they are stored.
  • Security enhancement: The best IDaaS solutions in the market incorporate top-notch security capabilities which allow for firm access controls and core security enhancements. Protection of the network environment is paramount since the primary attack vector are identities. Alongside SSO, ensuring these security features in IDaaS solutions are utilized is imperative: integration of password complexity, MFA, Secure Shell (SSH) Keys.

What is the future of IDaaS?

Even though decentralized identity has not established a firm foundational base, its uses and implications are important in mitigating identity-targeted cyberattacks. The primary method of data protection remains passwords, while the total attempts of identity and password thefts targeting the growing number of IoT devices is multiplying and widening.

In its present state, both private and government sectors are seeking a ubiquitous solution for digital identity management. Some of the potential trends that may transform the identity security landscape are mentioned below.

Artificial intelligence and machine learning

Context-based identity is one of the elements of Identity Management. To authenticate and identify, context-based identity compares data of the user who needs to be examined. Data comparisons might include the discovery of behavioral patterns like:

  • Log-in timings
  • IP address and machine address
  • Preferences and usage
  • Physical location
  • Unusual devices

Identification of patterns can significantly help with reduction in the rate of fraud and risks related to identity exposure. Data mining for discovering patterns via AI-based programming algorithms has been successful in the banking industry worldwide, with great potential to enter other industries in the future. ML is usually a complimentary capability which comes with AI integrations, and provides a high probability of success in identifying threats and detecting anomalies for greater identity protection.

Adaptive biometrics

A key attribute of the biometrics market growth is the increase in smart-card adoption and use. For accurate authentication and convenience, advanced biometric smart cards are more frequently deployed by organizations compared to other authentication methods. The interesting aspect about biometric smart cards is not the idea itself, but the result of the idea: biometric technology integration with smart card, essentially adding a layer of security in the form of fingerprint identification built in the card itself. This also leads to improvement in confidentiality as the smart card holder will need to provide biometric verification even to use the card. The US and Europe are a couple of regions that have already started using smart cards.

It is worth mentioning CARTA, which is the latest evolutionary stage of Gartner's "Adaptive Security Architecture (2014)," which has been refined to enable and retain the ability to remain competitive and to align with arising opportunities in the identity and security landscape. The application of CARTA across the entire spectrum of the business philosophies and practices is key to a successful implementation.

Blockchain-based identity-as-a-service

Blockchain is one of the most trending capabilities of the future. The demand for blockchain-based technology has been fueled by the organizational shift to digital platforms and the increasing risks of data breach. The attractive aspect of blockchain is that even though the technology is discordant, the opportunity it presents for IDaaS is remarkable, resulting in the convergence between the two, BIDaaS (Blockchain based identity-as-a-service).

Blockchain is decentralized by nature, which makes its features like transparency and solidity even more dependable. Public and private sectors are inclined to embrace blockchain as an emerging technology for multiple reasons. Hackers love pools of consolidated data, but decentralization in blockchain means that the true ownership of the data or information is retained even after data separation via ledgers spread across the network, ensuring duplication and global distribution of data.

When it comes to IAM and subsequently, IDaaS, audit trail and self-sovereign identity are the two main aspects of attention.

  • Audit trail: The complete history of login, requests of access, performed changes, granted permissions or any interaction by the users is logged and has a definite trail.
  • Self-sovereign identity: Individuals themselves take control of their identity data, thereby replacing the centralized identity providers. Even the decryption of data is carried out by the individuals whenever they deem it necessary.

Internet of Things

The demand for identity and access management services has sky-rocketed. Owing to the increasing vulnerability of IoT devices worldwide in October 2020, the annual revenue of consumer internet and media devices is forecast to make a leap from 2.7 billion to 25 billion U.S. dollars, from 2020 to 2030 respectively.

The total number of IoT devices worldwide is forecast to almost triple from 9.7 billion in 2020, to more than 29 billion IoT devices in 2030. Considering that diverse IoT devices will have a significant impact on the future, companies have started to respond to change in technologies in the following ways:

  • Inclusion of connectivity in product chain or even logistics
  • Adapting strategies to retain their competitiveness in accordance with emerging and innovative technology
  • "Preservation of human identities" is considered a prerequisite, even before choosing which technology is the best fit. That is, it is given the same degree of relevance as the priority of selecting the right technology.

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