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The global network security market size stood at USD 22.74 billion in 2019 and is projected to reach USD 54.07 billion by 2027, exhibiting a CAGR of 11.6% during the forecast period.
This market is likely to grow steadily during the forecasted period. The rising demand for smartphone and rising internet penetration in remote areas is boosting the demand for the software. In addition to this, industries are implementing bring your own devices (BYOD) policies which will create a need for secured data transmission. Industries such as healthcare and retail are facing security challenges by implementing advanced technologies that will boost the adoption of network security software in the coming years.
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Rising Implementation of 5G is Boosting the Market
The implementation of 5G technology is growing at a fast pace. 5G provides improved network services that help the devices to operate at a high speed along with better reliability, proper bandwidth utilization, and reduced latency. This has led to a high adoption of 5G in technologies such as artificial intelligence (AI), machine learning (ML), and industrial IoT among others. As the integration of technologies with 5G is increasing, more data will be shared via network creating more threats to the security of data. The risk of security and cyber-attacks are not just associated with 5G service providers but also with the users. The confidential information of all the industries will be present in every layer of wireless systems. The rising adoption of 5G services is expected to boost the demand for this market.
Along with IoT, 5G is being implemented for better data transmission in technologies such as autonomous vehicles in automotive, augmented reality virtual reality, smart city, robotic process automation among others. These technologies constantly share data via the internet with real-time analysis, which requires high speed and bandwidth connection. 5G is expected to provide the required speed to the user. To prevent the data breach and cyber-attacks, the implementation of the secured network is essential for security.
Thus, the growing trend of implementing 5G services is likely to generate high demand for network security solutions during the forecasted period.
Increasing Cyber Threats at the Network Point is Expected to Boost the Market
Globally, a rising connected digital world requires continuous data security and services from any location. For this, companies are launching multiple hosting environments where all mobile and fixed devices are connected to the server. As the companies are offering multiple hosting services, it increases the risk of data security. Subsequently, hackers are constantly attacking networks to breach and hamper the confidential information and destroying company databases. The network has become a prominent channel for disrupting the organization's data.
For instance, one of the major attacks on the network is the DDoS attack, where the attackers flood the network with fake traffic and steal the data. In various organizations, this type of security is implemented to protect data from the external environmental threats. Many attacks are penetrated internally, where the hacker can have authorized access to the organizations' network. Thus, making it essential to monitor the network and host at every connection level. When working over the internet and local area network (LAN), network security is the most important aspect. A better and protected network reduces the risk of data theft and cyber-attacks. The tools such as firewalls and data loss prevention software detects the threats at the initial stage. This is encouraging industries to implement this tools and software to protect data from the rising number of cyber-attacks.
The other challenge for the users is viruses and malware that directly through the network. These viruses and malware disrupt files and documents only after the user triggers a specific action. With the help of antivirus and anti-malware, a network architect or the IT specialist can provide network security. The rise in threats is boosting the network security industry growth, as there will be more requirements for network security solutions. Thus, the rising attacks on the network are boosting the need for adopting secure network software.
Rising ‘Bring Your Device’ BYOD Policies in Organizations is Likely to Boost the Market
Organizations these days are encouraging employees to bring their own devices to the workplace; it also helps to reduce investments in systems. The other reason for the BYOD policy is to let the employees work from any location. The devices are connected to the organization's network from any location and can access the information. Although BYOD offers several advantages, there is a data privacy risk associated with it. The hacker can get into organizations' networks through any BYOD channel. This has become essential for the organization to protect the networks and confidential information from being hacked.
The rising BYOD policy has encouraged the vendors to provide BYOD security solutions. For instance, in supply chain management, the employer is connected to the various vendors and shares data. This increases the risk of data breaching and thus, it is essential to implement network security. With this implementation, the attacks can be stopped and traced. The increasing implementation of the BYOD policies in organizations is likely to drive this market during the forecast period.
Low Security Budget by the Companies is Likely to Hamper the Adoption of Network Security Solutions
Today, almost every industry is facing challenges in dealing with threats and a lack of authentic data security. Still, the companies are not keeping the required budget for security solutions. Also, the initial installation cost of software is high and it also requires regular examination which is likely to hamper the adoption of this product for a short period.
However, despite the high cost of the solutions and increasing attacks, small and medium enterprises can deploy customized affordable security solutions as per the need, and operations of the organization.
Firewall, Data Loss Prevention, and Intrusion Prevention System are Likely to Gain Traction
The type segment is categorized into firewalls, antivirus and antimalware software, VPN, data loss prevention, intrusion prevention systems, wireless security, others (email security, application security etc.)
The adoption of firewall security is mostly adopted in every industry, thereby contributing to maximum revenue share. The firewall controls and monitors the incoming and outgoing files to the authentic source, IP address, and ports & protocols. The firewall software and services act as a barrier and prevents unauthorized access to the data.
The industries today connected through the internet for data transmission and communication. The data loss prevention software makes sure that no data is shared without permission over the internet. Also, with the rising adoption of BYOD, it is essential to secure data internally. The adoption of data loss prevention software is driven by internal security threats.
With recent advancements in network, the adoption of intrusion prevention systems is increasing. The intrusion prevention systems are witnessing steady adoption owing to its ability to block threats rather than just detecting it.
These advanced security features provided by each type of software is likely to boost the demand for network security solutions in the near future.
Large Enterprises are Likely to have Maximum market Revenue Share
The enterprise size segment in this market is categorized into small & medium enterprises and large enterprises.
The organization's policy such as Bring Your Own Devices (BYOD) is boosting its demand in large enterprises. Large enterprises have witnessed an increasing number of attacks in the last few years. Owing to this, large enterprises are keeping more share of the budget to deal with data security. On the other hand, rising awareness about security and increasing cyber-attacks are encouraging small and medium enterprises, thereby boosting the market. In several cases, hackers attack small and medium enterprises just to interrupt business growth, there is a loss of data or some other important things of the enterprises. Through this, the businesses suffer great losses financially and private data is exploited, thus SMEs too require secured networks. Also, with the help of the government initiatives and funds, startups are investing in network security. The adoption of these security software by small and medium enterprises is expected to grow steadily shortly.
Rising Adoption of Technologies is Likely to Boost the Demand of Cloud Technology
The deployment segment in the market is divided into on-premises and cloud.
The organizations with more confidential data and want to keep it internal have adopted the on-premises. Also, organizations that want to reduce the risks of latency and delay will go for on-premises.
Advancements and rising applications of technologies such as artificial intelligence, machine language, IoT and more are forcing the industries to adopt cloud-based solutions. The cloud-based software helps organizations to scale up quickly with the help of real-time configuration. Due to these reasons, the adoption of cloud-based security deployment is witnessing steady growth.
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Healthcare and Retail Industries are Likely to Witness High Adoption of This Market
The industry segment is categorized into BFSI, IT and telecommunications, retail, healthcare, government, manufacturing, travel and transportation, energy and utilities and others (education, etc.)
The IT & telecom sector is expected to gain the highest market share followed by government and BFSI in the network security market. The BFSI contains a high amount of confidential data and personal information from its shareholders. This industry has witnessed the highest threats and attacks over the period. Also, increasing demand for mobile banking and internet banking is raising the risk of network threats and data breaches. This will lead to the adoption of a security solution soon. The government segment is likely to have the second-highest market share, owing to its large sets of confidential data shared including public and official are shared for online process.
In terms of CAGR, the healthcare and retail industries are expected to witness high growth in the forecasted period. The issue of security and privacy of information is growing in the healthcare industry. The healthcare industry is investing in new technologies such as cloud computing, artificial intelligence, natural language processing, and IoT to reduce operational cost and enhance healthcare services. Also, there is a rise in the adoption of Electronic Health Records (EHR), to store sensitive information of the patients in the hospitals. With the high adoption of medical insurance and claims, huge data is shared between patients, providers, and payers, raising the need for information security of the network. The network attacks can vary by type of system and the location of the network. With the adoption of these new technologies such as EHR, AI, and others to increase efficiency in the process, the healthcare industry is facing new threats. Protecting private data of patients at every point of access has become essential for the industry to adopt essential security solutions. Thus, the industry is witnessing high adoption of the software to protect data at every network node.
Similarly, the retail industry is developing and expanding its e-retail solution. The data of the industry is majorly stored on the cloud. The customers are also connected to the e-retail services on mobile and computers through the internet network. This has generated a huge demand for secure networks by the industry. The retail industry is expected to grow with second-largest CAGR during the forecast period.
North America Network Security Market Size, 2019(USD Billion)
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Global network security market scope is divided across five regions namely North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.
North America is expected to have a maximum share of this market. The adoption of software is highest in the U.S. Top industries such as BFSI, healthcare, and retail are highly implementing the software to maintain its data privacy. The U.S. is upgrading the existing software, along with innovating new security techniques and has filed the maximum number of patents on cybersecurity in the market. Canada is also witnessing steady adoption of the software.
Europe is also growing steadily in the security software market. With its Cybersecurity Strategy of 2013, the European Commission has increased its efforts to protect data online. Europe has invested around USD 707.55 million for research and innovation particularly for network and information security during the period 2014-20. The U.K. is the leading country in this market. Most firms in the U.K. offer solutions for secure networks, along with cyber professionals’ services, and information risk assessment & management. While Germany is also witnessing steady growth in the market. After the U.S., Germany, and France have filed the maximum number of patents in the market for network security.
Similarly, Asia Pacific is likely to witness a healthy year on year growth during the forecasted period. China is progressing in the market and investing in research and development of security software. The government is also encouraging the public to adopt digitalization in their daily lives. With this, there is a rising requirement for secure networks and it will boost the market growth in India. In addition to this, governments across various countries are implementing security law and policies for preventing data breaches.
Investment in the Middle East and Africa have now started to gain momentum owing to the increase in cyber-attacks. Saudi Arabia is the fastest growing country in the region. The country has been investing and establishing committees to deal with the security threats, such as Saudi Research and Innovation Network, SAFCSP (The Saudi Federation for Cyber Security and Programming). In Latin America, the government is providing security infrastructure to combat the threats and data breaches. Most companies in this region are focusing on executing security of network and endpoint security strategies.
Cisco Systems Inc. is Highly Investing in Offering Advanced Solutions for the Organizations
Cisco Systems Inc. is growing continuously from a small number of security products to more than 500 partners selling more than six security solutions. The company is constantly expanding its portfolio for its customers by providing security solutions with a wide variety of products. The company is also planning to shift its security solutions with integrating software, automation and subscription focus strategies.
October 2019 –Cisco Systems Inc. acquired Duo Security Inc., an intent-based networking strategy based in Michigan. The acquisition will help the company to provide a software-based and subscription-based security portfolio. By integrating Duo’s competitive edge of security with Cisco solution, will boost the company position in this market.
November 2019 – Cisco Systems Inc. acquired Singularity Networks, a network analytics provider for enhancing its network analysis based in Denver. The company offers real-time traffic analysis for cloud and premises-based. This will boost Cisco’s network automation portfolio along with it will offer real-time identifications of threats.
Major players in the market are highly investing in acquisition and partnership to offer suitable security solution
Key companies in this market are aiming to gain and maintain a competitive differential advantage by constantly investing in security innovations and acquisitions. The major players in the market such as Check Point Software Technologies Ltd., WatchGuard Technologies, Inc., FireEye, Inc., Juniper Networks, Inc., and McAfee, LLC are entering onto partnerships or acquiring other security businesses to offer an entire suite of security solutions. The vendors are offering advanced network and endpoint security solutions as per the requirement of the organizations and size of enterprises. The market players are offering cloud-based solutions of network security such as Cisco Systems and McAfee, Kaspersky Lab.
An Infographic Representation of Network Security Market
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The market report highlights leading regions across the world to offer a better understanding of the user. Furthermore, the report provides insights into the latest network security market trends and analyzes technologies that are being deployed at a rapid pace at the global level. It further highlights some of the growth-stimulating factors and restraints, helping the reader to gain in-depth knowledge about the market.
Value (USD billion)
By Enterprise Size
Fortune Business Insights says that the market was valued at USD 22.74 billion in 2019.
Fortune Business Insights says that the market is expected to reach USD 54.07 billion in 2027.
Growth of 11.6 % CAGR will be observed in the market during the forecast period (2019-2027)
Within the industry segment, the healthcare segment is expected to lead during the forecast period.
The increasing adoption of smartphones along with organizations bring your own device (BYOD) policy is expected to primarily drive the market growth.
FireEye, Inc., Juniper Networks, Inc., Kaspersky Lab., Cisco Systems, Inc., McAfee, LLC, are the top companies in the market.
The cloud segment is expected to grow steadily at the highest CAGR.
The revenue of the market in North America in 2019 was USD 9.76 billion.
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