With security concerns continuing unabated, carriers stand to make a tidy profit in delivering managed security solutions to their customers.
According to International Data Corporation's updated Worldwide Semiannual Security Spending Guide, managed security services is the largest segment within the security services category. IDC's report says that security-related services will be both the largest—with $40.2 billion in spending this year—and the fastest growing (at 12% compound annual growth rate) category of worldwide security spending. Managed security services will deliver nearly 50% of the category's total in 2022, with integration and consulting security services accounting for most of the remainder.
Worldwide security spending is forecast by IDC to reach $133.7 billion by 2022, with a CAGR of 10%. As a result, security spending in 2022 will be 45% greater than the $92 billion forecast for this year.
Service providers, such as AT&T, Verizon, Deutsche Telekom, and CenturyLink, and telecom vendors have in-depth security offerings for commercial and residential customers. Earlier this year, CenturyLink boosted its Security Log Monitoring platform by blending in machine learning and artificial intelligence, while Cisco doled out $2.35 billion in cash and assumed equity awards to buy cloud-native and software-as-a-service vendor Duo Security.
The telecommunications industry is projected to have the fastest growth in security spending with a CAGR of 13%, followed by state and local government (12% CAGR) and the resource industry (12% CAGR).
Opportunities also exist in security software, which IDC said was the second-largest category with spending projected to total $34.4 billion this year. End-point security software will be the biggest software segment throughout the forecast period, followed by identity and access management software and security and vulnerability management software. Security and vulnerability management software will be the fastest growing area in the software segment with a CAGR of 10.7%.
Unified threat management, firewall and content management are projected to be the biggest growth areas for security hardware spending.
This all points toward the need for continued spending and research on security measures. Bloomberg Businessweek reported on Thursday that China planted a microchip the size of a grain of rice on a motherboard that led to the infiltration of almost 30 U.S. companies, including Apple and Amazon.
RELATED: Radware's study shows that security measures are falling flat for organizations
A report by cybersecurity vendor Radware found that at least 89% of survey respondents had experienced attacks against web applications or web servers over the past 12 months. The study also revealed that most organizations (67%) believed that hackers could still penetrate their networks.
Cisco tops enterprise firewall rankings
Paced by the growth of enterprise-class firewalls, network security appliance market revenue grew 9% year over year in the second quarter of this year, according to a report by Dell'Oro Group. Cisco was the top firewall vendor in the enterprise sector, followed by Palo Alto Networks, Fortinet, Check Point, Huawei and Juniper Networks.
“The firewall/enterprise segment again realized robust growth in 2Q 2018, increasing 15% year-over-year to record levels,” said Casey Quillin, director at Dell’Oro Group, in a prepared statement. “Networks now require protection against numerous vulnerabilities, from securing connectivity for multiple users and device types to mitigating the risks of delivering disparate applications in hybrid Cloud environments. New products addressing, especially those with application-aware or next generation functionality, are driving high-end firewall revenue growth.”