Security Software Sales to See Slowdown in '09
A Gartner study says appliance-based products saw the fastest growth in 2008. Overall, the global security software revenue grew from $11.7 billion in 2007 to $13.5 billion in 2008. Analysts said demand for appliance-based products saw an increased demand from segments like e-mail security and secure web gateway markets.
"In 2008, the security market did not show any noticeable impact from the economic downturn," said Ruggero Contu, principal research analyst at Gartner. "A double-digit growth in a challenging economic climate shows that security remains a key priority for CIOs and IT security leaders."
Globally, data security and privacy, along with the need to protect IT infrastructure from the ever increasing sophisticated and targeted attacks, are among the key drivers fuelling the growth of IT security software spending. For organisations operating in North America and Western Europe, compliance was among the major drivers.
The combined top five vendors’ market share is gradually falling in favor of smaller players, a sign that security remains a dynamic market where smaller players, new entrants, and specialist vendors provide an effective challenge to the established leaders.
Symantec continued to be the market leader, as it accounted for 22% of worldwide security software in 2008. However, the company’s market share was down from 2007 when it accounted for 24.4% of the market. McAfee experienced the strongest growth rate among the top five vendors, as its revenue increased 20.5% in 2008.
The segments in the appliance-based products that recorded the fastest growth in 2008 were, security information and event management (SIEM), e-mail security boundary, and secure web gateway appliance with 50%, 37.7%, and 29.9% increases respectively.
Web access management (WAM) and endpoint protection platform (EPP) were the slowest performing segments. Web access management (WAM) technologies have reached maturity and few vendors experienced strong customer-base growth, with the majority experiencing mid-to-low single digit growth. The low growth of the EPP suite was impacted by the mature and slow growing antivirus component, which is the largest product component in terms of revenue.
"During times of economic uncertainty and budget restrictions, IT security leaders increasingly need to show business value and cost-effectiveness for security measures, and this has impacted and slowed sales cycles," concluded Mr Contu. "However, new product delivery methods, such as software as a service (SaaS) and host based offerings, and expected increasing interest from the small and midsize business (SMB) sector will sustain growth in the market in 2009."
In 2009, Gartner predicts that the security software market will show signs of slowdown but will continue to grow at around 9%.
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