According to a recent Bloomberg Intelligence (BI) report, cyber security spending will top $200 billion per year by 2024
The increase in cyber security spending predicted by BI in its study, Cybersecurity Primer: Accelerating Cloud Shift, is expected to be driven by a shift to cloud security, with network and endpoint security segments expected to expand at the fastest rates.
Exponential rise in remote working is partly to blame for the market’s growth, which reached $132 billion last year. However, cloud-based software was already gaining traction in the security space before the Covid-19 pandemic, as it replaced conventional infrastructure.
In fields including enterprise resource planning, databases, systems software, and customer relationship management, cloud software is already well-established.
In the coming years, companies like CrowdStrike, Zscaler, and Okta are expected to grow three to four times faster than the market as a whole.
According to the study, larger network security firms such as Palo Alto Networks, Check Point, and Fortinet may concentrate on mergers and acquisitions due to their strong balance sheets and need to transition to cloud products.
Meanwhile, according to BI, new market players will arise to challenge the existing leaders, with Crowdstrike being the most likely contender.
Furthermore, according to BI, security spending would account for a greater portion of IT budgets as businesses attempt to fend off more advanced cyber attacks while avoiding reputational and business risks.
Unlike other tech segments, where Amazon, Microsoft, Google, and Salesforce have run-rates of more than $10 billion, no security company currently has annual sales of more than $5 billion.
Commenting on the report, Mandeep Singh, Senior Industry Analyst at BI, said “The biggest upside to expectations of high single digit growth for the cyber security market may come from faster-than-expected adoption of cloud-based security in areas such as network and endpoints,”
“These two segments with about $31 billion in combined annual revenue depend heavily on sales of appliances and on-premises software and may benefit most from a migration to the cloud.”