Security software spending booms in Europe

Europe's security software market is booming. IDC estimates that in 2002 the market reached US$ 2 billion and is expected to increase by 15% during 2003.

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By  Greg Wilson Published  August 14, 2003

The security software market is booming in Europe. IDC estimates that in 2002 the market reached US$ 2 billion and is expected to increase by 15% during 2003. The analyst house forecasts that security software revenue in Europe will reach approximately $4.5 billion by 2007.

“As a patchwork approach to security has negative implications on all aspects of the corporations’ well-being, security investments continue to ‘climb up the corporate ladder’ with vendors having to do the impossible — offer integrated, multi-level security solutions to meet blended threats, yet stressing their simplicity and cost effectiveness to target a largely non-technical, executive audience,” says Carla Arend, research analyst with IDC's European Security Products and Strategies service.

“Despite economic instability and poor performance of other high-tech markets, most security software vendors have obviously mastered this challenge with the result being an impressive growth rate of 25% from 2001 to 2002,” he adds.

The spending on secure content management is at the forefront of the evolving market showing 34% growth rate during 2002. IDC predicts that the secure content segment, which includes anti-virus, messaging and web filtering software will be worth $2 billion in 2007.

“The evolution of threat with new hybrid attacks exploiting multiple vulnerabilities of an organisations infrastructure continues to drive the SCM market. However, Europe needs to wake up to the fact that, while essential, anti-virus and firewalling alone won’t get the job done,” comments Arend.

A second high growth in the security software market is the authorisation, authentication, and administration (3A) market, which is forecast to show a CAGR of 14% until 2007. 3A vendors are quickly repositioning themselves as identity management vendors. IDC believes that identity management will be the driving force for Web services.

“Web services represent a whole new model for integrating applications, which means organisations have to think in a whole new way about security,” says Arend.

“Identity management will embrace all 3A software technologies and extend into directory services and hardware authentication devices as well. This represents a great opportunity for all 3A vendors,” she adds.

The firewall/VPN software market is coming under increasing pressure from security appliances. To benefit from this trend, more software vendors are providing their software preinstalled in appliances, which will continue to move the two firewall markets together.

Despite slowing down somewhat, the firewall/VPN software market is expected to reach more than $300 million in 2007.

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