Study: South African security market continues growing

The South African IT security market has continued to be an area of solid growth from 2003 to 2004, according to ICT market research analyst BMI-TechKnowledge (BMI-T).

This follows the publication of the latest research report entitled “IT security market sizing and forecast 2004 – 2009” in September 2005.

Says Roy Blume, services & software divisional manager at BMI-T: “The SA IT security market demonstrated growth of 16 per cent from 2003 to 2004, and is valued at R1.26 billion. We currently expect this market to reach a value of R2.95 billion by 2009, representing a compound annual growth rate (CAGR) of 18.5 per cent.”

Some of the findings of the research include:

Mergers and acquisitions: The IT security market has experienced consolidation over the past 18 months, with a number of high profile mergers and acquisitions occurring, in SA and internationally.

Blended threats: Over the past 12 months, there has been a marked increase in the number of blended threats and attacks on software and/or application vulnerabilities. Enterprises have not only invested in network-layer security but have also shifted their security efforts to application layers to mitigate any possible security risk.

Government regulations and corporate governance: External government and corporate governance regulations have had a moderately high impact on the SA security market in 2004. The American initiative of Sarbannes-Oxley has begun to have greater impact on local organizations, as more corporations around the globe become compliant. Any SA organization wanting to deal with an American or multinational corporation in the future will need to become Sarbannes-Oxley compliant.

Proliferation of broadband Internet access: Broadband and “always-on” Internet connectivity has experienced huge growth in SA over past few years, and has seen great uptake by the higher end of the home users market, and by SMEs.

Mobile/wireless services: While mobile computing offers new opportunities for virtual communications at the same time, it also increases the vulnerability of corporate networks and systems. With multiple access points dispersed across different geographies, both inside and outside the organization, the potential for exposure to threats is exponentially increased. The demand for architecture and design services as well as security strategy and planning is expected to rise in 2005 as a consequence.

Antispam: Antispam solutions have seen great uptake over the last year. Spam has a dual effect of having a financial impact on the organization in that it wastes storage space, and takes-up valuable bandwidth. Coupled with the financial impact, it is also an irritant for users and wastes time in creating rules and dealing with unwanted messages. Antispam tools are the key point technology for 2004/5.

Spyware: The proliferation of spyware has increased widely in the past 12 months, hidden in ‘free’ program downloads, and infecting user’s computers by various other means. Spyware may be installed merely to track Web browsing habits and targeting the users with specific advertisements, or it may be more sinister and capture login details, credit card numbers, and Web passwords. Vendors are increasingly providing end-to-end solutions as opposed to merely providing point protection. Increasing

Internet fraud: ‘Phishing’ has become a concern to anyone who has used the Internet to conduct any financial transactions.

Increased media coverage: Concerns about network security vulnerabilities continued to receive increased attention over the past few years. The by-product of press coverage includes increased demand for security policy reviews and vulnerability assessments to test the preparedness not only for external attacks but also for a host of internal threats (e.g., contractors and disgruntled employees).

BMI-T expects that integrated security appliances will continue to grow in popularity within the local market as they provide comprehensive and integrated hardware and software security solutions.

The caveat to the growth in appliances is that the purchase decision is made far more complicated.

For companies used to shopping for standardized products, the different performance capabilities offered by various security appliances will mean that even the simplicity associated with packaged solutions may still be too complicated for many to evaluate without channel assistance.

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