Firewall and IP Virtual Private Network Equipment: Worldwide, 2002 (Executive Summary) Executive Summary

Transcription

1 Firewall and IP Virtual Private Network Equipment: Worldwide, 2002 (Executive Summary) Executive Summary Publication Date: 20 August 2003

2 Authors Caroline Jones Andy Rolfe This document has been published to the following Marketplace codes: TELC-WW-EX-0682 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 Firewall and IP Virtual Private Network Equipment: Worldwide, 2002 (Executive Summary) Introduction This report complements Gartner Dataquest's "Firewall and IP VPN Equipment Market: Worldwide, 1H02," TCEC-WW-MS-0298 and TCPN-WW-MS Thefullmarketstatisticsdocumentpresentsdataforthecombinedmarketfor dedicated firewall and IP virtual private network (VPN) equipment. This includes both hardware and software and using data for Producing this combined set of statistics has allowed us to remove any overlap between our reporting of the IP VPN and firewall market statistics, a situation caused by the increasing overlap in product function between these two markets. Findings Results for 2002 have matched our growth estimates for this market, which were based on 2001 data. The unexpectedly high revenue reported in the first half of 2002 did not continue in the second half. Despite this slowdown, enduser revenue showed considerable growth of 17.9 percent year over year. As predicted, Cisco Systems, Check Point and Nokia continued to dominate this market. Together they accounted for 62 percent of worldwide end-user revenue. North America remained the largest regional market, ending 2002 with a 50 percent share, having dipped to 48 percent in the first half of the year. All regions have kept the same market position year over year. In terms of end-user segmentation, the large enterprise segment (over 1,000 staff) extended its lead, with 51 percent of total revenue. It was followed by the medium enterprise segment (100 to 1,000 staff), carrier market and small enterprise (under 100 staff) segments. Looking at product segmentation by end-user spending, slightly less than half the total revenue for 2002 was attributable to the midrange segment, where pricing is between $1,000 and $15,000. But the midrange and the small office sectors each lost 1 percent market share to the high-end sector during the secondhalfoftheyear. Conclusions Data relating to the firewall and IP VPN equipment market for 2002 leads us to the following conclusions. The actual revenue growth rate for 2002 was as we predicted at year-end 2001; the higher-than-expected growth in the first half of 2002 was not sustained throughout the year. North America lost out to other regions in the first half of the year, but recovered in the second half. This pattern of movement was consistent with that of the large enterprise sector, as large enterprises are more prevalent in North America. Europe, the Middle East and Africa and Asia/Pacific will increase their market share, at the expense of North America region, but this will only happen gradually Gartner, Inc. and/or its Affiliates. All Rights Reserved. 1

4 2 Firewall and IP Virtual Private Network Equipment: Worldwide, 2002 (Executive Summary) The large enterprise sector continues to perform strongly, with revenue growth of 34 percent year over year. This market is driven by the replacement of legacy solutions with products with more features and the expansion of existing firewall/vpn connectivity in-house in the absence of managed services from a service provider. The medium enterprise sector also showed improvement in revenue year over year, with nearly 14 percent growth. This shows that this segment is following the trend seen in large enterprises for providing security and connectivity inhouse, where acceptable managed solutions cannot be found. Gartner Dataquest expects this trend to continue steadily through The carrier and small enterprise sectors performed weaker in revenue terms in 2002 than in The market for dedicated equipment in the carrier sector, which fell 3.4 percent year over year in terms of revenue, is diluted by the growing trend for large enterprises (and, to a lesser extent, midsize enterprises) to buy in equipment for in-house solutions. The small enterprise market for dedicated equipment showed a drop in revenue of 2.6 percent year over year. This is partly because price pressure is particularly fierce in this segment where the argument for using a solution with less features may be much stronger. Also, some vendors, including Nortel Networks, shipped a very high proportion of low-end products in 2002, which means lower end-user revenue for the sector. The economic climate continues to inhibit the market, particularly in the carrier end-user sector where companies are unable to invest heavily in the infrastructure for IP VPN services. But according to Global Insight (formerly DRI-WEFA) economic forecasts, the gross domestic product for the world economy will peak at 3.6 percent in 2004 and remain above 3.3 percent through As the carrier end of the market picks up, the small and medium enterprise sectors will be the first to feel the effects. The main driver for managed IP VPNs from service providers, once economic conditions improve, is small and midsize businesses' desire to benefit from the convenience and cost-effectiveness of IP VPNs while avoiding the problems of global support and management. Use of the Internet for business information and transactions will continue to grow among public and private enterprises, providing a powerful driver for the firewall and IP VPN equipment market. The number of Internet access seats worldwide grew 13 percent in This will fall to about 8 percent growth in Growth in e-business will also bring growth in sales of firewall equipment, as more open and outward facing e-business systems need increased security. The compound annual growth rate for e-business services will be about 36 percent between 2001 and 2006, with slower growth in 2002 rising to a peak in AnIPVPNneedsclientsoftwaretobeloadedontousers'PCs.Butsomevendors are starting to offer Secure Sockets Layer (SSL)-based solutions as an alternative, which do not require special client software. During 2002, the market for such solutions developed from a niche inhabited by specialist companies to one that included major networking vendors and their solutions Gartner, Inc. and/or its Affiliates. All Rights Reserved. 20 August 2003

5 Firewall and IP Virtual Private Network Equipment: Worldwide, 2002 (Executive Summary) 3 Links For the full market statistics, see "Firewall and IP Virtual Private Network Equipment: Worldwide, 2002," which is published to the Public Network Infrastructure Worldwide and Enterprise Networking and Communications Clusters: TCPN-WW-MS-0394 TCEC-WW-MS Gartner, Inc. and/or its Affiliates. All Rights Reserved. 20 August 2003

6 4 Firewall and IP Virtual Private Network Equipment: Worldwide, 2002 (Executive Summary) 2003 Gartner, Inc. and/or its Affiliates. All Rights Reserved. 20 August 2003