The Network Security and Datacentre Appliance market – firewall, content security, intrusion detection/prevention, and application delivery controller – is forecast to grow at 6% five-year compound annual growth rate (CAGR) from US$14 billion in 2019 to $19 billion in 2024. Growth at 6% is slightly weaker than the typical high single-digit pattern over the last decade, but considering COVID-19, this is explicable.
COVID-19 will continue to impact the market both negatively and positively throughout 2020 and into the first half of 2021, assuming that an effective vaccine is developed and allow society to re-stabilise. The network-security market will continue to experience both positive and negative factors. The negative factor of delayed spending will have a slight advantage however, leading to flat year-on-year (YoY) growth in 2020. Post-pandemic, the network security market is expected to return to the overall growth of 8% YoY from 2021 to 2024 and reach $17.1 billion in 2024.
The network security market will vary significantly from historical growth trends during COVID-19. The Content Security and Firewall market is expected to rebound and return to nominal growth post-pandemic. However, the intrusion detection/prevention market will not, and will continue to its long decline.
Top Four Trends Impacting Forecast
- Investment in enterprise IT transformation will accelerate due to COVID-19 and drive overall market growth. Many enterprises that are neither digitised, multi-cloud present, nor mobile-friendly have experienced more business continuity problems during the pandemic than those farther into their transformation. Expect investment to be broad-based in the service of securing new applications, new datacentres, and connectivity solutions for mobile, branch, and campus environments.
- COVID-19 has drastically increased the ranks of teleworkers. While many teleworkers will eventually go back into the office, the percentage of teleworkers post-pandemic is expected to be significantly higher than pre-pandemic – between 20% and 45%, as work and cultural norms change in favour of teleworking. Secure connectivity solutions will stand to benefit as enterprises invest for the long-term.
- COVID-19 will also accelerate enterprise automation and expand the network and application footprint that needs to be secured. Many enterprises want to automate manufacturing processes to ensure business continuity while implementing physical distancing. The increase in automation and associated expansion of the network footprint will continue post-pandemic, as the growth in connected devices – IoT – accelerates.
- Investment by public-cloud service-providers and telco service-providers will continue to grow to support the higher number of enterprise IT workloads and 5G on their platforms, respectively.