Cyber Warfare Market Size & Trend Analysis Report By Application (Defense, Government, Aerospace, Homeland, Corporate), By Region, And Segment Forecasts, 2018 - 2025

Report Overview

The global cyber warfare market size was valued at USD 20.10 billion in 2016, registering a CAGR of 18.5% over the forecast period. In the recent past, government and international organizations have become focused on cybersecurity owing to increased security challenges posed by or within the cyberspace. This has raised several concerns to national security thus alarming the need for robust cybersecurity posture. Thus, government, military, and other agencies are engaged in protecting its digital infrastructure and devices connected to the internet aimed to deter cyber-attacks.

An increase in defense spending for improving the government’s effectiveness, efficiency, and cybersecurity capability is anticipated to be the key factor driving the implementation of cyber warfare systems across all the geographic regions. The agenda such as modernizing government IT infrastructure, improving deteriorated facilities, and curbing cyber vulnerabilities are further anticipated to drive the market over the forecast period.

The growing technological advancement in IT and the capabilities of cyber weapons leading disruption to national security is constantly reshaping threat landscape. Thus, cyber-related threats are identified as one of the highest occurring global risks. Moreover, cyber warfare is emerged as a significant threat to the nation, outstripping terrorism. The mitigation of losses arising due to increasing cyber-attacks on countries, leading to economic disruption, has become a significant concern.

As the emerging nations soar towards digitization, cyber warfare emerges as a major growth constraint. In order to deter from the cyber espionage and data breaches in the military and defense sector, different nations have increased their spending on cybersecurity and have established units that are engaged to overcome cybersecurity challenges. Thus, increasing demand for cybersecurity is anticipated to drive the market over the forecast period.

Over the past few years, various industries have witnessed a steady increase in the number of security breaches that were related to cyber espionage. The sophistication of cyber-attacks has increased the resulting nation or state hackers to abuse network security and gain privileged access to sensitive data. For instance, in 2017, the Australian Signals Directorate (ASD) reported sensitive, high-level information breaches such as Australia's warplanes and navy ships that were stolen from an Adelaide Defense subcontractor. The mystery hacker named “ATP ALF” stole information about the programs such as the C-130 Hercules transport plane, F-35 Joint Strike Fighter project, and the P-8 Poseidon maritime surveillance aircraft project.  The hacker managed to access the system for a month before it was detected in November 2016.

The U.S. Federal Government has taken several initiatives against cyber-attacks and constantly demonstrates its cyber warfare capabilities to help deter sophisticated attacks from potential adversaries. The government is building its cyber army and proposed 133 teams for its "cyber mission force" by 2018 - 2027. Moreover, it engages in proactive training and development to military personnel in the U.S. Army Cyber Center of Excellence (CCoE) which is the U.S. Army's force modernization proponent for cyberspace operations, signal/communications networks, and information services. Further, increased defense budget to safeguard cyberspace, protect Federal networks, and critical infrastructure from cyber-attacks is further anticipated to propel the market growth over the forecast period.

Application Insights 

The defense application segment is estimated to retain its dominance, accounted for USD 5.96 billion in 2016, registering a CAGR of 18.8% over the forecast period. Dependency on communication & information technology in the military & defense has led to exposure to cyber risks. The defense sector is allocating increased funding to cybersecurity units to mitigate & deter the potential threat from a nation and state hacker. The emergence of new technologies & Internet of Thing (IoT) in the defense is anticipated to be the driving factor for the application of the cyber warfare system in the defense sector. Furthermore, the development of the existing cybersecurity posture and technologies are expected to fuel the application of cyber warfare system in the defense sector.

The government has taken significant steps to curb cyber vulnerabilities in the recent past. The government application segment was valued at USD 5.3 billion in 2016, growing at a CAGR of 19.1% over the forecast period. In the recent past, a significant increase in the sophistication and intensity of cyber-attacks has led developed countries to build resilience and adopt national cybersecurity strategies.

Most Nation’s government are moderating its security posture. Recently, NATO leaders made resourcing cyber defense a top priority at the NATO Summit in Warsaw in July 2016, aimed to strengthen cyber defenses of national infrastructures and networks. For instance, in 2014 the French launched the "Cyber Defense Pact" and endowed with a Euro 1 billion dedicated to secure, deter, anticipate and react to cyber-attacks. In 2016, the UK announced a Euro 1.9 billion investment to underpin its national cybersecurity program.

Regional Insights

The North America region is estimated to hold a significant share in 2016 and is expected to continue its dominance by 2025. Increasing cyber defense budget, government efforts to protect its digital infrastructure, and focus on strengthening cybersecurity approaches are the key driving factor impacting the regional demand. Moreover, the establishment of cybersecurity units and deploying robust cybersecurity frameworks within government agencies, the military and defense sector are further driving the market growth.

Asia Pacific is estimated to grow at the fastest growth rate of 21.1% from 2017 to 2025. The Asia Pacific offers potential growth opportunities for the cyber warfare application to grow mainly due to key factors such as regulatory reforms by the governments to ensure cyber defense posture, rapid economic growth in the developing countries, and increasing pace of technological advancements in cyberspace. Moreover, increasing cyber-attacks have emerged as a vital factor, considered for the defense budget allocation by various nation’s government thereby driving the market over the forecast period.

Key Companies & Market Share Insights

The market is moderately fragmented with prominent players such as BAE System Plc, Boeing, General Dynamic Corporation, Lockheed Martin Corporation, and Raytheon Company acquiring a significant share of the overall market. These players adopt a variety of competitive strategies such as merger & acquisition and offer tailored solutions to cater to customer requirements. The other players in the market are increasing market presence by the expansion of its product portfolio through investment in R&D activities and acquiring new technologies.

For instance, in November 2017, Intelligent Waves LLC acquired the Virtual Mobile Infrastructure (VMI) technology and its associated intellectual property of Hypori, Inc. The acquisition of a virtual platform will deliver protected cloud-based functional mobility, control, and command to the U.S. federal government across the world.

Cyber Warfare Market Report Scope

Segments covered in the report

This report forecasts revenue growth at global, regional & country levels and provides an analysis on the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global cyber warfare market report on the basis of application and region.

• Application Outlook (Revenue, USD Billion, 2014 - 2025)

  • Government

  • Aerospace

  • Homeland

  • Corporate

  • Others

• Regional Outlook (Revenue, USD Billion, 2014 - 2025)

  • North America

    • The U.S.

    • Canada

  • Europe

    • Germany

    • UK

  • Asia Pacific

    • China

    • Japan

    • India

    • Australia

  • Latin America

    • Brazil

  • Middle East & Africa