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​Up, then down, then up again… Topsy-turvy market awaits security vendors

​Up, then down, then up again… Topsy-turvy market awaits security vendors

“2016 will be a difficult year for many security vendors and security service providers.”

The next twelve months will represent a difficult year for many security vendors and security service providers with enterprise security revenue set to grow at just 10.7 per cent in 2016 - lower than growth seen in the market in the prior two years.

“Diminished growth will be due to political uncertainty in the U.S., a declining economy in China and the lingering effects of disparate security regulations in European Union countries,” says Jane Wright, Senior Analyst and Security Research Lead, Technology Business Research.

“The relatively low number of significant breaches against major brands in the past year will also pressure security revenue growth in the coming year.”

By 2017 TBR expects these macro trends to moderate and black hats to devise new attack methods, leading to a rebound in the market.

Total revenue for IT security hardware and software products as well as managed and hosted security services totalled $US42 billion in 2015, and an 11.2 percent CAGR to $US71 billion is expected by 2020.

Wright believes that when looking ahead, mobile security revenue will grow the most, albeit on the smallest base, as customers secure an increasing number of employees’ mobile devices to protect business data.

Security management solutions will also generate strong growth as security information and event management systems, which are a significant component of the segment, expand from data collection and correlation points to more extensive responsibilities coordinating a breadth of security responses.

“Revenue in the data security and application security segments will grow below the total market growth rate, however, as customers seek to reduce complexity by choosing solutions in other segments that integrate a selection of data loss prevention and application security features,” Wright adds.

Regionally, the Asia-Pacific region will see the strongest revenue growth, with its contribution expected to increase to 20.1 percent of market revenue by 2020.

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