Report Overview: Cyber Security Market
The global cyber security market size was valued at USD 145.4 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 9.9% from 2021 to 2027. Cyber security and defense against online threats undertake greater significance in today’s digital changing landscape. It has become integral amid organization due to rapidly increasing frauds, cybercrimes, risk, threats, and vulnerabilities. Disruptive and emerging technologies in banking, retail, information technology, defense, and manufacturing sectors have offered new capabilities, facilitated automation, and offered ease of working in the recent past. However, these technologies have also emerged as a potent factor in the development of the global threat landscape of exploits, vulnerabilities, and malware. The emerging threat landscape is observed with an increased number of cybercrime activities in the global digital era.
The growing popularity of digitalization has compelled organizations to extensively rely on digitized information. Sharing of a vast amount of data in an external and internal environment as well as across the globe has made organizations to fall prey to cybercrime through different forms of attacks. A successful online attack can harm the enterprise as well as its reputation and brand. It can further result in a loss of competitive advantage and cause steep financial damage. In the wake of breaches and high-profile data theft, it becomes integral for an organization to determine future threats, signaling them to redesign their cybersafety stance. Thus, cyber safety is becoming a strategic imperative for an organization owing to an increased focus on preventing cybercrime activities, which can hamper the momentum of the business.
Technologies such as the Internet of Things (IoT) and new business models extensively rely on global digitization for their growth. As the system becomes more complex, interconnected, and handles more information, the exposure to attack surface becomes much broader while exposing the gaps in the security system of the business. The primary platform for an increase in cybercrime activities is connectivity through the use of Big Data, cloud, social media, and mobile services. For instance, third-party data storage and cloud-based services have opened avenues for an online attack, which previously did not exist. Moreover, IoT products enabled with IP sensors are anticipated to introduce vulnerabilities to the user data, if they have not been adequately tested. Such services operate on the backbone of the internet and will become increasingly connected over a period of the next three years, allowing the need for a robust cyber safety system in the business environment.
The convergence of such events has driven the proliferation of endpoint and wireless safety services in an enterprise improving access to corporate information, both on-premise and outside the corporate network. A robust cybersafety layer in a business environment is aimed to detect, prevent, and react to the network attack or cyber-attack at the time of intrusion. A scalable and flexible strategy while taking advantage of the requisite solution prepares an organization to combat unforeseen challenges to their safety infrastructure.
In the wake of the COVID-19 pandemic, several incidences and cases of Cybercrime were observed across industries. Cyber threat actors that follow Cybercrime as a Service have increasingly targeted every part of the demographics that searched information related to COVID-19 using malicious domain names registered with names as COVID-19 or coronavirus. According to the Palo Alto Networks, at the end of March 2020, around 40,261 suspicious registered domain names were identified. Additionally, in recent times the use of identical business email addresses also became the preferable choice for cyber attackers to conduct attacks. Furthermore, with the shift towards the remote working environment, cyber threat risks increased among organizations. The pressing concerns of cyber threat risk influence organizations to adopt solutions and configure malware protection, detection, and mitigation strategies.
The services segment lead in 2019 with a 54.7% revenue share of the cyber security market. It is also anticipated to continue its dominance over the forecast period 2021-2027. cyber security vendors offer both professional and managed services to provide IT support and assistance for troubleshooting software issues and carrying out regular maintenance. Furthermore, the need for continuous event monitoring, vulnerability management, and real-time dedicated security support for timely delivery of products is compelling enterprises to adopt these services. Thus, the need for timely support and professional assistance is expected to aid the growth of the cyber security market subsequently. Moreover, the rising trend of employing third-party vendors by organizations owing to their robust solutions offered at optimum costs thereby boosts the growth of Security as a Service (SaaS).
The hardware segment is expected to register the highest CAGR over the forecast period contributing to the market. The hardware comprises of next-generation equipment and devices such as encrypted USB flash drives, firewalls, and Intrusion Prevention System (IPS) equipment that secure the organizations IT networks by monitoring their networks from malicious incidents. These hardware systems and equipment are deployed by large enterprises, and Internet Service Providers (ISPs) that have multiple computers control the network activity. The hardware equipment protects the network activity by forming an additional layer of defense from attacks and their attempts to enter computing systems. Thus, the segment revenue is majorly concentrated around protecting the network stacks.
The growing trend to identify, monitor, and mitigate threats in real-time is influencing enterprises to adopt advanced solutions such as security analytics, advanced SIEM solutions, advanced malware, and threat detection solutions. Furthermore, increasing demand to protect complex IT infrastructures from advanced threats and malware while delivering content across the web and deploying client solutions using cloud also influences enterprises to adopt solutions and enhance their IT safety infrastructure. Moreover, digital transformation and digital workplace trends also augment segment growth.
Security Type Insights: Cyber Security Market
The infrastructure protection segment lead the market in 2019 and accounted for 27.8% revenue share. Due to the increase in the number of online attacks globally, mitigation of the losses arising out of these incidents has become a significant concern across all the sectors. Furthermore, the growing adoption of connected systems across industries that share sensitive data over the internet increases cyber risks. The increasing online attacks on the organization’s critical infrastructures, IT infrastructure space, and industrial processes are anticipated to boost demand for infrastructure protection. Additionally, an increasing number of government regulations worldwide regarding data safety and privacy and compliance is anticipated to be a key factor boosting the segment growth.
The cloud security segment is anticipated to expand at the highest CAGR over the forecast period. The growth can be attributed to the growing adoption of cloud-based deployment solutions and services among enterprises. Moreover, the increasing risk of malware infiltrations, risks of unauthorized access, and the increasing number of threat actors across cloud layers are impelling enterprises to adopt cloud solutions and services. Additionally, the rise in web traffic to access media content is also propelling segment growth.
Solution Insights: Cyber Security Market
The Identity and Access Management (IAM) solution segment lead the market in 2019 and accounted for 29.6% revenue share. The growth can be attributed to the growing adoption of mobile endpoints across organizations, which increases risks such as vulnerability and breaches. Furthermore, the increasing use of cloud computing and shared network to access critical organizational data is also driving the need for IAM solutions. Rising insider threat attacks and the need to automatically maintain IAM policies such as password management, roles, and privilege management, and change in historical policies. Moreover, increased demand for IAM in BFSI aimed to manage, measure security, and identify risks associated with user access is anticipated to propel the segment growth over the forecast period.
The IDS/IPS segment is anticipated to expand at the highest CAGR of over 11.1% during the forecast period. The solutions improve network security by analyzing and monitoring the events of known threats, thereby mitigating detected incidents in the networks. Furthermore, the increase in IT security spending and increase adoption of network security products is expected to drive the market over the forecast period. Additionally, the sophistication of hacking attempts and an increase in cyber threats are expected to fuel the market growth. The need to avoid potential data loss and data leakage due to cyberattacks is the primary factor driving the segment growth. Both insider and outsider attacks account for equal threats and warrant public disclosure of data, which can negatively impact the organizations finance. Especially with the implementation of the EU General Data Protection Regulation (GDPR) policy, failure of protecting consumer information can lead to a fine of up to 4% of company revenue.
Service Insights: Cyber Security Market
The professional service segment lead the services segment with a market share of over 70.0% in 2019. The growth is attributed to the demand for employee training, penetration testing, enterprise risk assessment, cyber security defense, and physical security testing. The vendors assess the overall enterprise risks and business requirements before implementing cyber safety solutions. With the use of extensive knowledge, organizations could minimize additional costs that require to monitor and manage security projects. The operational assistance provided as a professional service also reduces gaps in staffing skilled professionals and improves support efficiency in managing IT infrastructure.
The managed services segment is expected to register the fastest CAGR over the forecast period, owing to increased threats from conventional insurgent activities. Further, the increasing cybercrime and danger posed by Advanced Persistent Threats (APTs), Managed Security Service Providers (MSSPs) are helping SME and large enterprises to build cyber-capabilities with services such as prevention, detection, and remediation. The IT support extends their support to manage, monitor, and analyze the cyber capabilities of the implanted solution.
The on-premise segment lead the global market in 2019 with a revenue share of over 60% of the overall revenue. Organizations prefer to keep confidential data in-house rather than turning it over to cloud providers. Keeping data in-house reduces dependencies on third-party organizations and helps them to protect and monitor their data explicitly. Moreover, on-premise solutions also allow hands-on ownership and control of security monitoring, which offers flexible and adaptive security program. This is expected to increase the demand for on-premise cyber security deployment over the forecast period.
However, enterprises are migrating from on-premise to cloud-based solutions due to the cost-effectiveness of the latter. Thus, the cloud-based segment is anticipated to register the highest CAGR of 09.8% over the forecast period. Furthermore, organizations are transforming business over cloud aimed at providing access to information for in-house and cross-border operation to its employees. Increasing adoption of public cloud is driving the demand for cloud-based safety solutions.
Organization Insights: Cyber Security Market
The large enterprise segment lead the global market in 2019 with a revenue share of 69.3% of the overall revenue. Large enterprises are increasingly strengthening their cyber security capabilities. However, an increase in sophistication of attacks and emerging threats are proving to be challenges for safeguarding the corporate data. Furthermore, an increase in web-based applications in large enterprises is expected to increase the demand for cyber security solutions over the forecast period.
The SME segment is expected to grow at a significant rate over the forecast period. SMEs lack the required security infrastructure and skilled professionals as compared to large enterprises. As a result, they are more prone to cyber-attacks. Furthermore, the increasing adoption of cloud-based services to conduct business by SMEs is expected to increase the security vulnerabilities, which is expected to increase the demand for the cyber security solutions over the forecast period. Additionally, the increasing regulatory compliance is expected to increase the demand from SMEs over the forecast period.
Application Insights: Cyber Security Market
The defense/ government application segment led the market in 2019 and accounted for 24.4% share in terms of revenue. The growth can be attributed to the increasing spending on security solutions, research and development activities, and financial activities related to cyber security and growing concerns related to data breach, which can potentially lead to cyber terrorism. Moreover, the government sector is increasingly targeted with attacks including negligent insiders, malicious malware, and zero-day attack. Thus, mitigation of online attacks through robust security architect is a key trend, which will drive the segment over the forecast period
The healthcare application segment is anticipated to register a high growth rate over the forecast period owing to the increased cybercrime activities in the recent past. The cybercrime activities involved insider threats, data breaches, ransomware, advanced malware attacks, and distributed denial of service attacks in the facilities, which compromised the integrity of systems and disrupted the overall patient care services. Moreover, the creation of misleading websites and phishing activities to obtain sensitive information also predicts the development of the market. Additionally, the growing adoption of cloud applications, connected devices, digital solutions, and availing open-source information for awareness among healthcare providers, payers, and patients also emphasizes the need for security solutions and reduces the risk of vulnerabilities.
Regional Insights: Cyber Security Market
North America lead the market in 2019 with a revenue share of 36.7%. The demand for cyber security solutions is attributed to the presence of prominent security vendors that have global and regional headquarters in U.S. Furthermore, the increased spending on security solutions and services by large enterprises and SMEs are the other factors driving growth. Additionally, the increasing stringency in standards and policies for maintaining data privacy and security also contributes to the regional market growth.
Asia Pacific is expected to expand at the highest CAGR over the forecast period. The increasing efforts toward securing endpoints, networks, and cloud infrastructure are anticipated to contribute to the market growth in the Asia Pacific region. Rapid adoption in smartphones and the usage of the internet is increasing digital services across the region. The increasing adoption of cloud and digital services also increases cyber risks and data thefts. Furthermore, active support by the organizations and governments to implement data security guidelines and IoT security frameworks in the region is influencing the regional market growth. For instance, the Internet Society, an organization that provides financial support for the internet standards processes, implemented the Online Trust Alliance initiative in April 2019. The initiative was implemented to provide a set of guidelines for the manufacturers, developers, and service providers to achieve greater security and privacy and enhance their product life-cycle.
Key Companies & Market Share Insights: Cyber Security Market
The market is continuously evolving with the changing dynamics of the cyber threat landscape. The fragmentation in the industry is increasing with the advancement in technology, which, in turn, enables other technology providers to enter the market by offering efficient real-time solutions to the organizations. Despite fragmentation, the increasing spending on security solutions is creating an opportunity for market participants. Additionally, major security vendors are actively involved in mergers and acquisitions strategies to capitalize on their market position. For instance, In April 2020, Investcorp, an organization that manages alternative investment products of institutional and private enterprises, acquired Avira Operations GmbH & Co. KG, a Germany based cyber security solution provider.
On the other hand, the emerging and innovative vendors are involved in product upgradation and establishing partnerships to increase their market share. For instance, in April 2020, Check Point Software Technologies Ltd. announced the availability of its Quantum Security Gateways series for the enterprises and corporate data centers. The series provides unprecedented protection solutions to enterprises of all sizes from their branch offices. Some of the prominent players operating in the cyber security market include:
Key companies Profiled: Cyber Security Market Report
This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Trusted Business Insights has segmented the global cyber security market report on the basis of component, security type, solution, service, deployment, organization, application, and region:
- BAE Systems, Inc.
- Cisco Systems, Inc.
- Centrify Corporation
- Check Point Software Technology Ltd.
- FireEye, Inc.
- McAfee, LLC
- Fortinet, Inc.
- LogRhythm, Inc.
- Lockheed Martin Corporation
- Palo Alto Networks, Inc.
- Sophos Ltd.
- Trend Micro Incorporated.
Component Outlook (Revenue, USD Billion, 2016 - 2027)
Security Type Outlook (Revenue, USD Billion, 2016 - 2027)
- Endpoint Security
- Cloud Security
- Network Security
- Application Security
- Infrastructure Protection
- Data Security
Solution Outlook (Revenue, USD Billion, 2016 - 2027)
- Risk & Compliance
Service Outlook (Revenue, USD Billion, 2016 - 2027)
- Professional Services
- Managed Services
Deployment Outlook (Revenue, USD Billion, 2016 - 2027)
- Organization Outlook (Revenue, USD Billion, 2016 - 2027)
- Small and Medium Enterprise (SME)
- Large Enterprise
Application Outlook (Revenue, USD Billion, 2016 - 2027)
- IT & Telecom