Major security vendors shed market share
Innovative start-ups are luring customers away from larger vendors, according to Gartner
Just 44% of the $16.5 billion global security software market belonged to Symantec, McAfee, Trend Micro, IBM and CA in 2010, according to Gartner.
The combined market share for the top five vendors has dropped from 60% since 2006.
Gartner analysis revealed that despite ongoing merger and acquisition activity in the market, it is far from reaching a consolidated state in which 60-70% of the market is owned by the top five vendors.
At the moment, any consolidation activity at the top-end of the security market is met with an expansion of the market at the bottom.
"The information security market is in a continuous state of consolidation, but even fairly intense merger and acquisition activity has not stopped the market from being very fragmented," said Ruggero Contu, principal research analyst at Gartner. "Market expansion and innovation are driven partly as a result of new start-up players entering the market. New players bring innovative technology solutions to cater for end-user requirements that in turn are created as a result of the new threats, often introduced by cybercriminals taking advantage of new vulnerabilities created by changes to IT ecosystems."
Symantec remains at the top-end of the market with the most market share at 18.9% in 2010; it is the biggest faller in terms of market share from 29.5% in 2006.
Following Symantec is McAfee, whose market share has only fallen 2% from 12.3% market share in 2006 to 10.4% in 2010.
Symantec is chased by Trend Micro at 6.3% market share in 2010, down from 8.1%; IBM at 4.9% in 2010, down from 5.3% in 2006 and CA, which has fallen from 5% in 2006 to 3.8% in 2010.
Gartner analysts suggest that the main reason for these drops in market share is that the established security companies are loosing customers to start-ups, which have developed new offerings to meet newly introduced threats and vulnerabilities, or have implemented a successful go-to-market strategy, built themselves a niche presence and gradually taken market share away from larger vendors.
The security market relies a great deal on innovation from start-up companies, which is particularly the case with a continuous influx of new vulnerabilities and threats.
The global security software market revenue is forecast to reach $18.8bn in 2011, up 13.7% from 2010.
In the Asia Pacific region, security market revenue is forecast to grow 12.6% to reach $1.7 bn.
"We expect more consolidation to take place, along with innovations being introduced by new additions to the market," said Contu. "The security market continues to provide good growth opportunities for both established players and start-up companies, and the market landscape remains fairly dynamic with many competitors. While end-user organisations have shown an increasing preference to use a suite of products from fewer suppliers, the complexity of end users' product portfolios will not be solved in the short term because new, stand-alone niche tools will continue to be purchased to solve new rising threats and vulnerabilities that incumbent players haven't been able to address."