The global Enterprise Key Management (EKM) market size was valued at USD 760.8 million in 2016 and is presumed to gain traction over the forecast period. EKM incorporates a centralized management tool to secure cryptographic keys that encrypt sensitive data across an organization’s distributed IT environments. The increasing adoption of cloud-based deployment and growing number of data breaches, coupled with the rising regulatory and compliance enforcements to protect sensitive data, are presumed to bolster the growth of the enterprise key management market.
A rise in the number of internet users and the rapid adoption of digital services have led to an exponential rise in the volume of sensitive data collected by organizations. This is further presumed to accelerate the adoption of encryption solutions. Innovative technology start-ups, such as Ionic Security, FinalCode, and Vera, have managed to gain significant funding through various venture capitalists and collaborations with technology firms. The increasing investments in cloud-based services and hardware security modules to facilitate encryption key management and data protection are expected to further accelerate the market growth.
North America EKM market revenue by application, 2014 - 2025 (USD Million)
However, issues pertaining to lack of skilled workforce, replacement costs of the existing IT infrastructure, and complexity of deploying enterprise key management solutions may hinder the market growth.
The North American EKM market has seen a broader adoption of encryption solutions across all verticals. The region has been a hotspot for innovation with the presence of major technology players and innovative new start-ups developing disruptive technologies. With availability of better technology infrastructure, organizations were early adopters in the digital era. This introduced a variety of potential risks including loss of personal information, and system malfunctions, among others that have been extensively exploited by malicious users.
The need to protect customer data in an evolving digital era, led organizations to adopt several security measures that would safeguard sensitive data. Encryption technologies offer better data security in a relatively cost efficient manner, driving growth of the EKM market across North America.
The disk encryption application segment accounts for nearly 37.07% of the market in 2016, acquiring a major share of the overall revenue. It is majorly deployed over hardware security modules across all industry verticals (for data encryption solution) to ensure data security by encrypting data at the source disk drive.
Cloud-based encryption solutions and communication encryption are expected to drive the market growth. Organizations are adopting cloud-based storage solutions to store business data, as they offer various cost benefits and operational efficiencies for organizations. These cloud storage solutions also offer encryption techniques to protect sensitive data at rest or in transit over cloud environments. This is further driving the growth of the EKM market.
Encryption technologies have various potential uses across all industry verticals as they offer enhanced data protection against malicious users. Technology firms and service providers are innovating and deploying a wide range of solutions that deliver operational efficiencies for organizations and comply with data security mandates.
On premise security solutions such as access control policies, active directories, encryption key management, and authentication are widely adopted across all major verticals as a part of their security strategy to mitigate data loss and privacy concerns. These require the deployment of hardware security modules across the organization’s distributed computing environment to ensure safety of data, management of policies and adherence to compliance standards.
Various organizations want to leverage the cloud, as they offer various cost benefits and drive operational efficiencies. The cloud environment enables organizations with lack of infrastructure and skill to deploy extensive security solutions to safeguard data. The agility, scalability and cost effectiveness of cloud solutions is enabling organizations to implement data security solutions. Small and medium enterprise are widely adopting cloud based services to deliver a variety of services for its customers, coupled with the increasingly stringent regulatory mandates is expected to drive the EKM market.
Enterprise Size Insights
Large enterprises are expected to hold a majority of the EKM market in 2016. Large enterprises have the capital to invest in various security solutions compared to other SME organizations. Data security and privacy is the main concern across all enterprises as they move towards a more digital environment. Large enterprises possess a variety of data such as customer information, supply chain data, financial records, and other business data, that needs to be protected as well as the need to adhere to a variety of regulatory and compliance mandates.
Small and medium businesses are heavily reliant on cloud infrastructure solutions for relatively easier market entry as they offer low capital investments, scalability, lesser time to market and pay per use models. SMEs are increasing becoming digital enterprises with a variety of differentiated offering across all sectors. This digital incorporation, cloud infrastructure and rising volume of data stored by SME sector organizations creates new potential threats to data privacy and security. These data privacy concerns, coupled with regulatory mandates to safeguard data will drive SMEs to adopt further advanced security solutions ensuring growth of the EKM market.
Enterprise key management solutions have been widely adopted across the BFSI sector, owing to the stringent regulatory and compliance mandates pertaining to safeguarding sensitive data. The BFSI vertical accounts for 31.9% of the enterprise key management market in 2016, acquiring a majority share of the overall revenue. Increasing online transactions, e-commerce, and increased digitalization of financial and welfare services are some of the key drivers leading to the high adoption of EKM solutions across the BFSI vertical.
Government and defense is expected to be the highest growing segment, followed by the healthcare industry. The government & defense; and healthcare sectors present significant opportunities for enterprise key management market, owing to the increasing digitalization of services. The growing need for safeguarding sensitive data related to patients, Electronic Health Information (EHI), has been the key driver of the healthcare vertical. The healthcare vertical was the most vulnerable sector and accounted for more than 36% of the total breaches in 2016. It is witnessing a rise in the adoption of EKM solutions due to the norms mandated by government agencies such as HIPAA-HITECH, FERPA in the U.S. and the EU Data Protection Directive in Europe.
Global EKM market, by vertical, 2017 (%)
Other verticals have incorporated encryption technologies to protect confidential data from unauthorized users. The demand for multi-cloud infrastructure, coupled with the rising levels of hacker sophistication, is expected to create a need for better encryption and easier key management.
The North American region is expected to lead the global enterprise key management market in 2017 with a major share. Technological proliferation, increased penetration of digital services across all major verticals, and the increasing cyberattacks have led to the rapid adoption of encryption solutions in North America. The presence of major technology players, such as Dell EMC, HPE, CA Technologies, and Oracle, has driven the growth of the market.
However, Asia Pacific is expected to emerge as the fastest-growing regional market with a CAGR of 22.3% over the forecast period. Advanced infrastructure, accelerated adoption of smart devices, increasing demand for digital services, investments in cloud and IoT technologies, and increasing regulatory enforcements are the key factors contributing to the high growth of the regional market.
The market is highly competitive, owing to the presence of various prominent players such as EMC Corporation, Gemalto N.V., Google, Inc., Hewlett-Packard Enterprise, International Business Machines (IBM), Thales e-security, Microsoft Azure, Inc., Townsend security, and CA Technologies, among others.
Industry players have been focusing on undertaking inorganic growth strategies, involving mergers and acquisitions with promising start-ups as well as established small and medium firms, to augment their product portfolios and gain a larger share of the market. For instance, Dell acquired EMC in September 2016 and HP Enterprises acquired Voltage security in February 2015 to expand their encryption portfolios. Major technology players are also making investments in innovation labs and centers of excellence as well as collaborating with various research institutes to develop new innovative solutions and differentiated products for the EKM market.
Base year for estimation
2017 - 2025
Market revenue in USD Billion & CAGR from 2017 to 2025
North America, Europe, Asia Pacific, Latin America, and MEA
U.S., Canada, UK, Germany, China, India, Japan, Brazil, and Mexico
Revenue forecast, company share, competitive landscape, growth factors, and trends
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Segments Covered in the Report
This report forecasts revenue growth at global, regional, and country levels and provides an analysis of industry trends in each of the sub-segments from 2016 to 2025. For the purpose of this study, Grand View Research has segmented the global enterprise key management market on the basis of applications, deployment, enterprise size, verticals, and regions:
Application Outlook (Revenue, USD Million; 2014 - 2025)
Deployment Outlook (Revenue, USD Million; 2014 - 2025)
Enterprise Size Outlook (Revenue, USD Million; 2014 - 2025)
Small and Medium Enterprise (SME)
Vertical Outlook (Revenue, USD Million; 2014 - 2025)
Government & Defense
IT & Telecom
Regional Outlook (Revenue, USD Million; 2014 - 2025)
Middle East & Africa
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