Spending on cybersecurity technology rose last quarter but will dip this year due to budgetary constraints, says Canalys.
Most businesses and industries have been hurt by the coronavirus pandemic and resulting lockdown. But some have benefited due to certain side effects, such as the shift to remote working. The cybersecurity industry is one sector that has captured more revenue as organizations strive to secure their remote workforces. However, that trend isn't likely to continue, according to a report published Tuesday by research firm Canalys.
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The global cybersecurity market increased by 9.7% in the first quarter compared with the same quarter in 2019, Canalys said. The rise in spending was triggered mostly at the end of the quarter as organizations rushed to set up security for their remote workers. The total amount spent hit $10.4 billion, which includes investments in network security, endpoint security, web and email security, data security, and vulnerability and security analytics. But some areas saw more growth than others.
"The unprecedented shift to remote working from March resulted in strong demand for endpoint security to protect new company-deployed notebooks, as well as consumer-owned devices used as part of business continuity measures," Canalys Chief Analyst Matthew Ball said in a press release. "Endpoint security shipments increased 16.9% to represent 15.4% of the total cybersecurity market. This strong growth continued into Q2, as more countries implemented lockdown measures."
Investments in web and email security jumped by 13.8% as organizations increased their use of Microsoft Office 365 and other cloud-based services and software-as-a-service applications. However, spending on network security inched up only 4% last quarter, Ball noted. Some security hardware appliance vendors were affected by supply chain constraints. Further, many organizations managed to use their existing network access through service engagements or by boosting capacity through more licenses. Those factors reduced the need to invest in new network security infrastructure.
Many cybersecurity vendors reacted swiftly to the COVID-19 crisis, according to Canalys. Cisco extended free licenses for its Umbrella, Duo Security, and AnyConnect Secure Mobility Client products for new and existing customers. The company also unveiled a $2.5 billion Business Resiliency Program.
Palo Alto Networks kicked off a financial services arm to offer extended payment terms and provided free 90-day trials of its GlobalProtect offering. Juniper Networks offered free trials of its vSRX virtual firewall, AppSecure, IPS, and SecIntel.
Bitdefender launched 12-month free access of its product for healthcare organizations. Kaspersky made its Endpoint Security and Hybrid Cloud Security available for free to the healthcare sector. Trend Micro provided its Maximum Security product free for six months to remote workers forced to use their own devices. McAfee offered short-term, three-month burst licenses for its Endpoint Security, DLP, Unified Cloud Edge, and CASB products.
Among cybersecurity companies, Cisco was the leading vendor last quarter, capturing 9.1% of total spending. Palo Alto Networks trailed with a 7.8% market share. Fortinet upped its slice of the market to 5.9%. Check Point was the fourth biggest vendor with a 5.4% share. In fifth place, Symantec grabbed a 4.7% share.
However, the bump in spending isn't expected to last. The cybersecurity market will face pressure as organizations trim their IT budgets due to adverse economic conditions. As such, investments in cybersecurity over the next 12 months will either be reduced or halted completely, Canalys said. This slowdown in spending is expected to carry for the rest of the year and into 2021, though some gains will come as free trials expire and customers move back to paid offerings.
"The vendors that were quick to support existing and new customers during lockdown will stand to gain the most once organizations reassess and reprioritize their cybersecurity strategies," Canalys Research Analyst Ketaki Borade said in a press release. "Workers will be more decentralized and work from multiple workplaces post-COVID-19. This has implications for the type of cybersecurity solutions needed, with greater emphasis on cloud security, zero-trust, and policy automation."
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