Internet of Things (IoT) Security Market Size, Share & COVID-19 Impact Analysis, By Component (Software, and Services), By Enterprise Size (SMEs, and Large Enterprises), By Deployment (Cloud and On-Premise), By Product Type (Network Security, Endpoint Security, Application Security, Cloud Security, and Others), By Application (Smart Homes, Smart Manufacturing, Connected Logistics, and Others), By End-use Industry, and Regional Forecast, 2020-2027

The global IoT security market size was valued at USD 2,221.0 million in 2019 and is projected to reach USD 20,776.1 million by 2027, exhibiting a CAGR of 32.3 % during the forecast period.

According to Palo Alto Networks, Inc. Unit 42 IoT threat March 2020 report, 98% of IoT device traffic is unencrypted. This data illustrates that the majority of confidential and personal data on the network is vulnerable to cyber-attacks. Owing to the growing advantages and exponential popularity of the Internet of Things, it is essential to deploy advanced security management of IoT networks and devices.

Furthermore, as per a 2020 survey by Checkpoint software technologies Ltd, 71% of security professionals have noticed an increase in security or threat attacks post COVID-19 pandemic outbreak. This figure shows, in the midst of COVID-19 pandemic, many hackers are exploiting vulnerabilities that can be embedded in coding at the most fundamental levels. For instance, the Indian Computer Emergency Response Team (CERT-In) issued an advisory note in June 2020 which states that malicious attackers are planning to launch a massive phishing attack campaign against individuals and businesses. The phishing campaign is expected to hack emails to drive receivers to fake websites. These factors are expected to contribute to the exponential growth of the market.

 Coronavirus Outbreak to Motivate Enterprises towards Adoption of Robust Security Solutions

The spread of the Coronavirus pandemic has brought a drastic change to working environments across the globe. Whilst, the working force in government, education, and IT sector has adjusted to the work from conditions. Organizations are forced to make fast changes enabling a robust secured communication network. Among the security attacks, the most common attacks include malware, ransomware, E-mail phishing campaigns through connected networks, and fraudulent websites that claim to contribute donations or advice. Such situations are likely to demand advanced security solutions. It is important to highlight that the economic influence of the pandemic is likely to differ due to country-specific characteristics and regional conditions.

LATEST TRENDS

Increasing Application of Blockchain is a Prevailing Technological Trend

Blockchain, a decentralized distributed ledger advanced technology is a key to advanced security solutions. The applications of blockchain in the connected device ecosystem enables the direct sharing of information between connected devices instead of communication over centralized networks. Such connections reduce the susceptibility of IoT networks or devices to cyber-threats.

The IoT security service leverages sensor-embedded chips and blockchain to significantly increase security. IBM Corporation and Samsung have developed Autonomous Decentralized Peer‑to‑Peer Telemetry (ADEPT), a blockchain-enabled IoT system to create a distributed IoT network. Such applications of blockchain would ensure to prevail in the global market.

Artificial Intelligence (AI)-driven Security to Shift the IoT Landscape

The trend of seamless connectivity, machine learning, artificial intelligence, and other forms of artificial intelligence are becoming more integrated across several IoT applications. The advancements of the market towards autonomously controlled vehicles and devices and automation are gaining pace in the current scenario.

The outbreak of the COVID-19 pandemic has surged the demand for smart wirelessly connected devices in the healthcare industry. However, the security and privacy of the patient’s data have now become a priority for healthcare providers. Similarly, the application of artificial intelligence in managing the smart home infrastructure helps in collecting data from home IoT devices and helps in data security and privacy. The above factors illustrate that artificial intelligence-driven security is likely to drive enhanced security in the connected network environment.

DRIVING FACTORS

Growing IoT Deployments to Expand Market Size 

Organizations are embracing the Internet of Things (IoT) as a part of their digital transformation initiatives. To achieve the transformational goals enterprises are connecting and deploying a growing number and variety of IoT devices to their corporate networks. According to a 2019 forecast by GSMA Intelligence, the number of IoT connections will grow to 25.2 billion by 2025. As the IoT devices are linked to one another, if one device is compromised a hacker has the opportunity to hack multiple other devices on the network. Hence, this drives the need for robust Internet of things (IoT) security solutions.

Increasing Number of Malware Attacks to Spur Market Growth  

In recent years, there is a continuous spread of damaged IoT devices perpetrated by malware such as Telnet, Mirai, and denial-of-service attack (DDoS). The Mirai malware has spawned variants that are specifically engineered to infect the enterprise IoT devices such as digital signage television sets (TV) or wireless presentation systems. The expansion of the companies' IoT networks enables the hackers to access greater bandwidth connections which pose a major risk of DDoS attacks. Such malware attacks drive the need for robust IoT network security solutions across the end-users. 

RESTRAINING FACTORS

Failure to Manage Device Updates is Likely to Retard the Market Growth

In a connected network, heterogeneous devices communicate with one another through a range of different networking protocols across distributed environments. Applying updates including security patches, firmware, or software updates exhibits several challenges. As a result, failure to manage device updates is likely to retard the key market growth owing to the growing IoT deployments.

However, adopting a multi-layered security-by-design approach to secure the IoT networks is important for managing data, devices, cloud-based IoT apps and services, and other mobile services. Repercussions of avoiding security in IoT networks can lead to loss of capital, system failures, and certain damages in the operational workflow of the organization.

SEGMENTATION

By Component Analysis

IoT Security Solutions to Gain Traction During the Forecast Period

By component, the market is classified into solutions and services. Security solutions are expected to foresee more demand in the coming years. Security solutions offered by market players including Cisco Inc.’s IoT Threat Defense, IBM Corporations’ X-Force Red, help organizations to mitigate the risk of malware and ransomware attacks on the enterprise connected IoT network and seamlessly run the business. IoT security services are expected to witness significant growth in the coming years.

By Solution Analysis

Identity and Access Management (IAM) to be the Most Adopted Solution for Security Applications

The solution segment is further classified into identity access & management (IAM), data encryption & tokenization, device management, security analytics, unified threat management (UTM), and others. The other segment comprises intrusion detection and prevention systems, secure communication, etc.

The research and development in identity and access management have led to a new identity ecosystem namely Identity of Things (IDoT). The growing need for multi-factor authentication entails the need for identity and access management solutions. Security analytics is expected to witness a remarkable growth rate. Analytics-driven security solutions can ingest high volumes of information by leveraging advanced techniques such as machine learning to identify potential threats.

Data encryption and tokenization is a significant component of IoT security. Also, device management is expected to be a growing market trend. Intel Corporation offers device-as-a-service, a device management solution. The solution delivers superior security performance and management capabilities to boost the working efficiencies. Similarly, other security solutions, such as unified threat management, intrusion detection, and prevention systems, secure communications are expected to exhibit a notable growth rate in the coming years.

By Services Analysis

Professional Services to Generate Significant Revenue in the Global Market

The services segment is further classified into professional and managed services. Professional services are expected to generate significant revenue in the global market. The rapidly evolving IoT landscape is likely to drive the demand for more responsive managed security services.

By Deployment Analysis

The Growing Need for Real-Time Threat Detection to Drive the Demand for Cloud-Based Solutions

The market is classified into cloud and on premise based on the deployment type. The growing trend of security analytics, real-time threat detection is expected to drive the demand for cloud-based solutions. On-premise solutions are anticipated to show steady growth as most of the IoT devices are wirelessly connected.

By Enterprise Size Analysis

Small and Mid-Sized Enterprises to Prioritize IoT Security

By enterprise size, the market is categorized into small and mid-sized enterprises, and large enterprises. Large enterprises are expected to hold a major market share. The major market share can be attributed to the widespread communication network of established enterprises. Whereas, small and mid-sized organizations are likely to increase their spending on security in the connected networks.

By Product Type Analysis

Network Security to Account for Major Market Share

Based on the product type, the market is segmented into network security, application security, endpoint security, cloud security, and others. The other segment includes web security and data security. Network security is anticipated to hold a major market share. Network security includes firewalls, email security, anti-virus and anti-malware solutions, and network segmentation, among others. New Sky Internet Limited offers Network Security solutions to prevent external threats and prevent data leakages.

End-point security refers to securing end-user devices such as desktops, laptops, and other mobile devices. The increase in bring your own device (BYOD) policies incorporated with threats targeting endpoint device access and networks. These factors drive the need for endpoint security solutions. Application security, cloud security is expected to witness a notable growth rate during the forecast period.

By Application Analysis

Smart Manufacturing to Drive the Demand for Robust Connected Devices Security Solutions

By application, the market is classified into smart homes, smart manufacturing, connected logistics, connected healthcare, smart retail, and others. Increasing adoption of industrial IoT (IIoT), robotics, industry 4.0 drives the demand for robust security solutions across the manufacturing industry. Connected healthcare is likely to exhibit a significant growth trajectory owing to the proliferation of smart wearables among others.

By End-use Industry Analysis

Manufacturing Industry to Showcase Lucrative Market Opportunities

By the end-user industry the market is divided into consumer IoT, and the Industrial segment. The industrial segment is further classified into manufacturing, retail, IT and telecommunication, banking, financial services and insurance (BFSI), government & defense, transportation & automotive, energy & utilities, healthcare, and others.

The manufacturing industry is expected to show an exponential trend in the adoption of IoT security solutions. The advent of Industry 4.0, smart manufacturing, industrial bots, and smart factories are some of the factors that boost IoT security market growth across the industry.

Retailers are actively adopting advanced technology solutions such as location-based services, digital signage that leverages the beacons and sensor technology to drive personalized consumer experience. The increasing adoption of fleet management solutions including vehicle tracking, location finding, among others leads is likely to drive the market across the transportation industry.

Considering the post-COVID scenario the healthcare industry is expected to be a significant deployer of IoT security solutions. IoT devices deliver advanced benefits to hospitals and clinics. However, this exposes them to new security threats. These factors drive the need for advanced security solutions to limit security threats.

Industries such as IT and telecommunication, banking, financial services, and insurance, government, and defense are expected to account for a significant market share. Energy and utilities pose lucrative market opportunities owing to the applications of IoT such as smart Grid.

REGIONAL INSIGHTS

North America to Dominate the Global Market During the Forecast Period

The market has been categorized into five major regions including North America, Europe, Asia Pacific, the Middle East and Africa, and Latin America. The regions are further divided into countries. North America is anticipated to emerge dominant in the global market. Asia Pacific is expected to witness a high growth rate.

North America internet of things security market stood at 751.5 million in 2019 and is forecast to hold a major market share during the forecast period. According to the 2019 mobile economy report published by GSMA Intelligence, 46% of connections in North America will be on 5G networks by 2025. This exponential connectivity is bolstered by significant investments by the network operators across the region. Deployment of 5G networks is expected to create lucrative market opportunities for advanced security services.

The market in Asia Pacific is anticipated to show remarkable growth during the forecast period. According to a report by Aruba, a Hewlett Packard Enterprise company in 2019 86% of the organizations in Asia Pacific are expected to adopt the Internet of Things (IoT) technology. These statistics show that IoT adoption is on the rise across the region which will ensure to drive the demand for advanced security solutions.

Europe is projected to exhibit significant market growth. The government of the U.K. promotes robust security to be integrated into wireless products by design. In October 2018, the government published the code of practice for consumer IoT security. Also, in May 2019 the government of the U.K launched a consultation on regulatory proposals regarding consumer connected devices security. Such initiatives by the government fuel the market growth across the region.

The Middle East and Africa are expected to show moderate market growth. In 2019, Ericsson is expected to commercially deploy 5G networks in advanced markets in the region such as the United Arab Emirates (UAE), Qatar, and Saudi Arabia. This shows that the region exhibits unprecedented market opportunities in the near future. Latin America is expected to witness a steady market growth during the forecast period.

KEY INDUSTRY PLAYERS

Market Key Players have identified strategic collaborations and partnerships as an actionable business strategy

The most likely IoT security benefits of partnering are reduced costs, increased customer assurance of IoT security, and collaborative knowledge of IoT. The market players such as Intel Corporation, Mocana Corporation, and Fortinet Inc. are likely to adopt partnerships and strategic partnerships as their actionable business strategies. For example,

• February 2019 – Mocana Corporation announced complete integration of Trustcenter by Mocana with Intel secure device onboard (Intel SDO) service. The collaboration intends to optimize the automation time taken by the security configurations and provisioning of credentials for the IoT device being deployed on the corporate networks.


• October 2018 – Intel Corporation collaborated with Arm Limited, a semiconductor and software designing company headquartered in the Cambridge United Kingdom. Through this collaboration, the companies aim to provide advanced solutions to securely onboard Intel and Arm IoT devices to cloud framework or any application.

LIST OF KEY COMPANIES PROFILED:

• Cisco Systems Inc. (California, United States)


• IBM Corporation (New York, United States)


• Intel Corporation (California, United States)


• Thales Group (Gemalto) (La Défense, France)


• Forgerock (California, United States)


• Infineon Technologies AG (Neubiberg, Germany)


• Mocana Corporation (California, United States)


• NortonLifeLock Inc. (Arizona, United States)


• Allot Ltd. (Hod Hasharon, Israel)


• Fortinet, Inc. (California, United States)


• New Sky Internet Limited (Hong Kong)


• Others

KEY INDUSTRY DEVELOPMENTS:

• March 2020 - Infineon Technologies AG collaborated with Qualcomm Technologies, Inc. headquartered in California, United States to develop a prototype for 3D authentication built on Qualcomm Snapdragon 865 Mobile Platform.


• December 2019 – Forgerock launched Forgerock autonomous identity. ForgeRock Autonomous Identity is an advanced solution that offers smart AI-driven identity management and governance solutions.

REPORT COVERAGE

The IoT security market research report highlights leading regions across the world to offer a better understanding of the user. Furthermore, the report provides insights into the latest industry trends and analyzes technologies that are being deployed at a rapid pace at the global level. The report examines various paradigm shifts associated with the transformation of security solutions. It further highlights some of the growth-stimulating factors and restraints, helping the reader to gain in-depth knowledge about the market.

REPORT SCOPE & SEGMENTATION

ATTRIBUTE	DETAILS
Study Period	2016-2027
Base Year	2019
Forecast Period	2020-2027
Historical Period	2016-2018
Unit	Value (USD Million)
Segmentation	Component; Enterprise Size; Deployment, Product Type, Application End User industry, and Geography
By Component	Solutions Identity Access & Management Data Encryption & Tokenization  Device Management Security analytics Unified Threat Management (UTM) Others (intrusion detection and prevention system, secure communication) Services Consulting & Implementation Training and Education Support and Maintenance Professional Managed Security Services
By Deployment	Cloud On-premise
By Enterprise Size	SME's Large Enterprises
By Product Type	Network Security Endpoint Security Application Security Cloud Security Others (web Security, data security)
By End-User Industry	Consumer IoT Industrial Manufacturing Retail IT and Telecommunication BFSI Government & Defense Transportation & Automotive Energy & Utilities Healthcare  Others (media & entertainment)
By Application	Smart Homes Smart manufacturing Connected Logistics Connected Healthcare Smart Retail Others (smart education, smart meters)
By Geography	North America (By Component; By Enterprise Size; By Deployment, By Product Type, By Application By End User industry, and By Country) The U.S. (By Product Type) Canada (By Product Type) Europe (By Source, By Type, By Grade and By Country) Germany (By Product Type) UK (By Product Type) France (By Product Type) Russia (By Product Type) Rest of Europe (By Product Type) Asia Pacific (By Source, By Type, By Grade and By Country) China (By Product Type) India (By Product Type) Japan (By Product Type) South east Asia (By Product Type) Rest of Asia Pacific (By Product Type) Latin America (By Source, By Type, By Grade and By Country) Brazil (By Product Type) Mexico (By Product Type) Rest of South America (By Product Type) The Middle East & Africa (By Source, By Type, By Grade and By Country) The Middle East (By Product Type) Africa (By Product Type) Gcc (By Product Type)