Worldwide 2002 Security Software Market and Vendor Shares (Executive Summary) Executive Summary

Transcription

1 Worldwide Security Software Market and Vendor Shares (Executive Summary) Executive Summary Publication Date: 21 July 2003

2 Author Norma Schroder This document has been published to the following Marketplace codes: SOFT-WW-EX-0111 For More Information... In North America and Latin America: In Europe, the Middle East and Africa: In Asia/Pacific: In Japan: Worldwide via gartner.com: Entire contents 2003 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice

3 Worldwide Security Software Market and Vendor Shares (Executive Summary) Mixed Results at Top 5 Vendors saw security software new license revenue grow 9 percent in. The growthresultsamongthetopfivevendorsofsecuritysoftwareproductswere mixed. Symantec and Trend Micro exploited the strong demand in the still unsaturated consumer antivirus (AV) market, and both achieved growth in the 30 percent to 40 percent range (see Table 1). Network Associates, another vendor known for its AV products, made missteps in the channel, was unable to benefit from the consumer AV surge and achieved less than 5 percent growth. IBM, the only non pure play in the top 5, also grew less than 5 percent. Checkpoint, known for its software firewall and virtual private network (VPN) products, had a disappointing year, experiencing an estimated 30 percent contraction in new license revenue. Many of the company's hardware original equipment manufacturerer (OEM) customers continued to suffer as the telecom bust deepened in. Increasingly, buyers favored firewalls packaged as appliances rather than software, while new Secure Sockets Layer (SSL) VPN appliances also impacted Checkpoint's VPN sales. Appliance solutions from Netscreen, Sonicwall, Watchgard and others (not powered by Checkpoint) claimed the lion's share of buyer dollars. For more information, see the Gartner Dataquest Market Statistics report "Firewall and IP Virtual Private Network Equipment: Worldwide,," TCPN-WW-MS Slipping out of the top 5 in, but still in the top 10, Computer Associates, Internet Security Systems and RSA Security earned shares of about 3 percent. Next in line, Cisco, Novell and Sophos rose in share and rank in on the strength of their over 40 percent growth rates. Table 1 Worldwide Security Software Vendor Shares, New License Revenue (Millions of Dollars) Vendor Growth (%) Total Worldwide 3, , , Symantec Network Associates IBM Trend Micro Checkpoint Others 1, , Source: Gartner Dataquest (June 2003) 2003 Gartner, Inc. and/or its Affiliates. All Rights Reserved. 1

4 2 Worldwide Security Software Market and Vendor Shares (Executive Summary) New Security Software Categories This year, Gartner has enhanced its security software products tracking capability. Coverage of vendors has tripled and product categories were changed and enhanced. There are two key categories. Security infrastructure includes products that "keep the bad guys out." This category includes AV, content filtering, encryption, intrusion detection system (IDS), firewall and VPN, and security management consoles for monitoring and real-time diagnostics. Security administration includes products that "let the good guys in" and "keep the wheels on." This category includes identity and access management (IAM), public-key infrastructure (PKI) suites, stand-alone vulnerability assessment scanners and configuration management (VA/CM), as well as miscellaneous tools for business continuity planning and risk management. Security Infrastructure Outpaces Security Administration in The infrastructure category experienced 12 percent growth in. The largest segment, the AV segment, grew almost 30 percent as did the smaller content filtering segment. The AV market was largely driven by consumer market growth because major virus events raised consumer awareness. Microsoft's recent acquisition of Pelican for its host-ids and of Gedac's AV technology will likely drive AV price points down during the next several years, slowing revenue growth. While the AV segment grew strongly, the network security segments, firewall/vpn and IDS as well as encryption, contracted in, pulling down the infrastructure average growth to just 12 percent. The administration category achieved a mere 2 percent growth. Strong growth of over 10 percent in the VA/CM category and around 5 percent growth in IAM, was pulled down by continuing contraction in the PKI space (see Table 2). Table 2 Worldwide Security Software Major Segment Revenue (Millions of Dollars) Vendor Growth (%) Total Worldwide 3, , , Infrastructure 1, , , Administration 1, , , Source: Gartner Dataquest (June 2003) As shown in Table 2, security infrastructure software vendors' revenue is roughly double that of administration software vendors' revenue as a group. However, over the past three years, the share of administration in the revenue pie has declined from 40 percent to 30 percent. This was because the PKI segment has underperformed. PKI is not going to be a mass-market moneymaking technology, as PKI technology instead becomes embedded in operating systems and other application platforms. Too many early adopters have pulled back from big PKI projects, and all PKI vendors have experienced revenue declines, layoffs or worse. Except for government and certain niche applications, enterprises have found other cheaper, easier to manage substitutes that assure an acceptable level of trust. For example, a password management tool with appropriate reset policies is often good enough. The decline in the PKI segment of the security administration category will be offset by growth in its other segments. Gartner anticipates that IAM products and configuration management products will both be high growth areas and will eventually raise the share of the administration category back toward 40 percent during the next few years Gartner, Inc. and/or its Affiliates. All Rights Reserved. 21 July 2003

5 Worldwide Security Software Market and Vendor Shares (Executive Summary) 3 Gartner Dataquest Perspective saw continued stagnant growth in most software segments as the economic malaise now plaguing the global economy spread from the United States into Europe and Asia/Pacific. Overall business investment, IT budgets and IT capital budgets were all flat or down. Security was the only item on the IT budget not cut, not cut much or in some cases, even increased. Although the hype about cyberterrorism did not boost market spending on security (except in government and consumer antiviral), it may have prevented many IT managers from considering cuts. New different hype about regulation, HIPAA, Sarbanes-Oxley and others will continue to prevent security from being a target for enterprise budget cuts. Consolidation is gradually occurring in the industry. Recession has killed or at least retarded the adoption of certain technologies. PKI is destined to be a niche. The anticipated mobile security boom is delayed, or perhaps stillborn. Yet, even without the recession, technological change would be occurring in the security sector. Large pure-play security vendors are rearranging and expanding their portfolio of technologies, and the recession makes that easier to do. Content filtering is a segment ripe for consolidation. Because the security market space has relatively high growth rates, it is attracting entry by the "big guys" in related spaces. That entry is through acquisition, through partnership or sometimes through product development. Many network equipment vendors and systems management vendors are chasing security revenue as a cross-sell opportunity to their installed bases. However, Gartner anticipates that security best-of-breeds and security pure plays will be able to sharply limit the inroads of these big guys, at least for the near future. For the full report, see "Worldwide Security Software Market and Vendor Shares," SWSI-WW-MS Gartner, Inc. and/or its Affiliates. All Rights Reserved. 21 July 2003