Data-backed insights on why self-hosted API infrastructure continues to dominate enterprise deployments despite cloud adoption trends
On-premises API management maintains a commanding position in enterprise infrastructure, with self-hosted deployments holding 55.10% market share in 2025. While cloud solutions grow rapidly, enterprises in regulated industries, government agencies, and organizations requiring data sovereignty continue choosing on-premises control. DreamFactory's self-hosted platform addresses this demand directly—operating exclusively on customer infrastructure across on-premises environments, customer-managed clouds, and air-gapped deployments. With the global API management market valued at $8.86 billion in 2025 and projected to reach $19.28 billion by 2030, understanding on-premises deployment statistics is critical for enterprise architects and IT decision-makers.
Key Takeaways
- On-premises deployments command 55.10% of the API management market — Self-hosted solutions remain the dominant choice for enterprises prioritizing data control and security
- 96% of companies express cloud security apprehensions — Trust concerns sustain demand for on-premises API infrastructure
- 73% of enterprises implement hybrid cloud strategies — The future blends on-premises control with cloud scalability
- Over 40,000 API security incidents occurred in H1 2025 — Security remains the primary driver for on-premises preference
- 50,000+ production instances run on DreamFactory worldwide, processing 2+ billion API calls daily across self-hosted deployments
The Evolving Landscape of On-Premises API Management
1. API management market valued at $8.86 billion in 2025
The global API management market reached $8.86 billion in 2025, reflecting sustained enterprise investment in API infrastructure. This valuation underscores the business-critical nature of API management across industries.
2. Market projected to reach $19.28 billion by 2030
The API management sector is forecast to grow to $19.28 billion by 2030, representing a 16.83% CAGR over five years. This growth trajectory indicates expanding enterprise reliance on API-driven architectures.
3. On-premises deployment holds 55.10% market share
Despite cloud adoption narratives, on-premises deployments maintain 55.10% of the API management market in 2025. This majority share demonstrates sustained enterprise preference for self-hosted infrastructure where data sovereignty and compliance requirements take priority.
4. Hybrid architectures growing at 21.90% CAGR
Organizations increasingly blend deployment models, with hybrid API management architectures expanding at 21.90% CAGR through 2030. DreamFactory's deployment flexibility supports this hybrid approach through Kubernetes, Docker, and bare-metal deployments across on-premises and customer-managed cloud environments.
Why Enterprises Choose Self-Hosted API Management Solutions
5. 96% of companies express cloud security apprehensions
Nearly all enterprises—96%—report security concerns with cloud-based solutions. This widespread apprehension drives continued investment in on-premises API management where organizations maintain complete infrastructure control.
6. 73% of entities implementing hybrid cloud strategies
By 2025, 73% of organizations have adopted hybrid cloud strategies that incorporate on-premises components. This trend validates the need for API platforms that operate seamlessly across deployment environments.
7. 80% of enterprises utilize multiple public cloud providers
Enterprise multi-cloud adoption has reached 80%, creating complex integration requirements. On-premises API management provides a neutral control plane for unifying data access across disparate cloud environments. DreamFactory connectors support this multi-cloud reality with native integrations for AWS, Azure, and Google Cloud services.
8. Majority of organizations deploy applications across multiple data centers
Distributed infrastructure has become standard practice for enterprise organizations operating across multiple data centers. Self-hosted API management enables consistent governance and security policies across geographically distributed deployments.
9. Large enterprises manage extensive API portfolios
Enterprise API portfolios have grown substantially, with large organizations now managing hundreds to thousands of APIs. This scale demands robust management platforms with centralized control—a core strength of on-premises deployments.
API Security in On-Premises Deployments
10. Over 40,000 API security incidents in H1 2025
The first half of 2025 saw more than 40,000 API-related security incidents across 4,000+ environments. On-premises deployments provide the isolation and control necessary to mitigate these growing threats. DreamFactory's security controls include automatic SQL injection prevention, mandatory authentication, and granular role-based access control.
11. 95% of organizations experienced API security problems
The Salt Security 2024 report revealed that 95% of organizations encountered API security issues in the preceding year. Platform-enforced security in self-hosted environments eliminates the developer oversight that creates many vulnerabilities.
12. API-targeted DDoS attacks reaching record levels
API-targeted DDoS attacks have reached unprecedented levels, making API security a board-level concern. On-premises deployments enable organizations to implement custom DDoS mitigation without depending on third-party cloud providers.
13. Application-layer DDoS reached 15 million requests per second
Recent attacks on APIs have reached 15 million requests per second, demonstrating the scale of threats facing enterprise API infrastructure. Self-hosted platforms enable traffic analysis and filtering at the network perimeter before attacks reach application servers.
14. Security represents the largest functional segment in API services
Security has become a dominant functional segment in API services, reflecting enterprise recognition that API security requires dedicated investment and on-premises control.
Accelerating API Development with On-Premises Solutions
15. 82% of organizations have adopted API-first approaches
API-first development has reached mainstream adoption, with 82% of organizations implementing this strategy. On-premises API generation platforms accelerate this approach by eliminating manual coding bottlenecks.
16. 93% of architecture still uses REST APIs
REST remains the dominant protocol, used by 93% of respondents in industry surveys. DreamFactory generates REST APIs automatically from database schemas, producing endpoints that align with this industry-standard architecture.
17. 69% of developers spend 10+ hours weekly on API tasks
Developer time invested in API-related work exceeds 10 hours weekly for 69% of teams. Automatic API generation from database connectors dramatically reduces this burden, enabling developers to focus on business logic rather than boilerplate code.
18. 58% of developers spend significant time on API documentation
Documentation remains a time-consuming activity, with 58% of developers dedicating substantial effort to documenting APIs. Auto-generated APIs solve this problem by producing live Swagger/OpenAPI documentation that stays synchronized with actual endpoints.
19. 75% use CI/CD pipelines for API deployment
Three-quarters of organizations have integrated CI/CD pipelines into their API workflows. On-premises platforms with Docker and Kubernetes support integrate seamlessly into existing DevOps toolchains.
Enterprise Integration and Legacy Modernization
20. Large enterprises represent 58.50% of API management spending
Enterprise-scale organizations account for 58.50% of API management expenditure, reflecting their complex integration requirements. These organizations frequently maintain legacy systems that require on-premises API solutions for modernization without replacement.
21. 34% cannot find existing APIs within their organization
API discoverability remains a significant challenge, with 34% of teams unable to locate existing APIs. Centralized on-premises API catalogs with auto-generated documentation address this visibility gap. Vermont DOT's implementation demonstrates how DreamFactory connects legacy systems dating to the 1970s with modern applications through secure REST APIs.
22. 55% struggle with inconsistent documentation
More than half of organizations—55%—report documentation inconsistencies as a collaboration blocker. Configuration-driven API platforms eliminate this problem by generating documentation automatically from actual database schemas and endpoint definitions.
23. Platform solutions account for 62.20% of API management revenue
Integrated platform solutions dominate the market at 62.20% of revenue, indicating enterprise preference for comprehensive tools over point solutions. DreamFactory's platform approach combines API generation, security, documentation, and management in a single self-hosted package.
Industry-Specific Statistics: Regulated Sectors Leading On-Premises Adoption
24. BFSI sector commands 28.10% market share
Banking, financial services, and insurance organizations represent 28.10% of API management spending—the largest vertical market. These regulated industries frequently mandate on-premises deployments to meet compliance requirements. D.A. Davidson's implementation showcases how financial services firms use DreamFactory for secure, real-time API access to investor data.
25. Healthcare APIs growing at 19.40% CAGR
Healthcare API adoption is expanding at 19.40% CAGR through 2030, driven by interoperability mandates and patient data access requirements. HIPAA compliance frequently necessitates on-premises deployments where protected health information never leaves organizational control.
26. North America holds 40.20% of API management market
The North American market accounts for 40.20% of global API management spending, reflecting both mature enterprise IT infrastructure and stringent data protection requirements. Government agencies and healthcare organizations in this region particularly favor on-premises solutions.
27. 65% of organizations generate revenue directly from APIs
APIs have become profit centers, with 65% of organizations deriving revenue directly from their API offerings. On-premises management provides the control and customization necessary to support monetized API products. Customer implementations across multiple industries demonstrate how self-hosted API platforms enable new revenue streams while maintaining data governance.
The 2026 On-Premises API Management Outlook
The statistics paint a clear picture: on-premises API management remains essential for enterprises prioritizing security, compliance, and infrastructure control. While cloud solutions grow rapidly, the majority market share held by self-hosted deployments reflects enduring enterprise requirements that cloud-only approaches cannot address.
Key factors sustaining on-premises demand include:
- Data sovereignty mandates requiring data to remain within organizational or geographic boundaries
- Security concerns affecting 96% of enterprises evaluating cloud solutions
- Regulatory compliance in financial services, healthcare, and government sectors
- Legacy system integration requiring direct database connectivity without data movement
- Multi-cloud complexity demanding neutral control planes for unified API governance
DreamFactory addresses these requirements through its mandatory self-hosting model, supporting deployments on bare metal, VMs, containers, and Kubernetes across on-premises infrastructure, customer-managed clouds, and air-gapped environments. With 50,000+ production instances processing over 2 billion daily API calls, the platform has proven its enterprise readiness across government agencies, healthcare institutions, and global manufacturers.
For organizations evaluating on-premises API management solutions, request a demo to see how automatic API generation transforms database connectivity while maintaining complete infrastructure control.