Security factory revenues slide

Factory revenues for the worldwide security appliance market took a tumble in the first quarter of this year, falling 6% to US$316 million from figures recorded in Q4 2002, reports IDC. Despite the revenue decline, however, unit shipments increased by 17%.

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By  Zoe Moleshead Published  July 9, 2003

Factory revenues for the worldwide security appliance market took a tumble in the first quarter of this year, falling 6% to US$316 million from figures recorded in Q4 2002, reports IDC. Despite the revenue decline, however, unit shipments increased by 17%.

“The decline in vendor revenue and increase in total shipments is the result of a number of factors — increased deployment of devices for branch and remote offices, increased price pressure throughout the market, coupled with a weaker US dollar, and the clearing of inventory of in anticipation of the release of new products,” says Charles Kolodgy, director of IDC’s security products services.

In terms of vendor share, Cisco garnered a significant lead with 36.8% of the market, while Netscreen just edged ahead of Nokia with 14.4% and 13.4% respectively. However, Netscreen and Watchguard both registered year on year growth in the first quarter of 2003.

Products priced between US$3000-5900 also garnered the largest revenue returns, accounting for US$86 million of the total market. However, of the eight price bands monitored by IDC, the US$25,000-49,900 band registered the highest quarter on quarter growth of 42.5%.

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