The global encryption software market size is anticipated to reach USD 8.40 billion by 2024, growing at a CAGR exceeding 14% from 2016 to 2024. Presently, encryption software is leveraged in an array of settings including enterprises, defense, retail, banking & financial institutions, education, and industrial automation. Software enterprises across the globe are rapidly adopting encryption software to improve data security and enhance business proficiency. Brand reputation, data privacy concerns, and regulatory compliance are projected to be the power factors instigating organizations to take advantage of encryption software solutions.
With enterprises working through a multitude of management platforms and disaggregated point solutions organizations have become increasingly vulnerable to breaches. Organizations, small or large, are often challenged to protect the sensitive data and ensure compliance, which is estimated to fuel the market growth of the encryption software over the next eight years.
The rising penetration of smartphones, advancements in the mobile technology in terms of hardware and software, and their dissemination among businesses are further anticipated to escalate the demand over the forecast years. The growing number of enterprises moving toward cloud computing, coupled with the high data volumes, has further led to increased data breaches, commercial espionage, cyber-attacks, and theft & loss in companies, thus increasing the demand for protection of sensitive data. This has raised the deployment for encryption software.
Several industry verticals, such as BFSI and healthcare, need to comply with stringent regulations, including HIPPA, and PCI DSS, which have necessitated the implementation of data security solution thus resulting in the espousal of these solutions globally. Moreover, ascribed to the rising Internet usage and rapid digitization, the intellectual property of the users and enterprises, has become susceptible to infringement and theft. These security risks require organizations to implement solutions for safeguarding the data. Encryption software allows the organizations to safeguard their intellectual property and other sensitive data, thus escalating the market growth over the forecast period.
Even though these solutions offer considerable benefits, their espousal may experience challenges mainly in terms of budget. The cost associated with these solutions is usually high as many products demand a complete public key infrastructure, additional storage, and numerous software licenses. Further, deploying these solutions is also complex and time-consuming; but their benefits offered outweigh the problems related to intricacy and the time associated with their deployment.
North America held the majority market share ascribed to the presence of the well-established IT & telecom sector in the region and the generation of huge amount of data that needs to be safeguarded. Moreover, the rising security concerns, owing to the usage of the personal computers and internet in the private sector, are anticipated to propel the regional demand over the forecast years.
The on-premise segment emerged as a dominant deployment segment, accounting for more than 60.0% of the overall revenue in 2015. However, the cloud-based segment is expected to grow considerably over the forecast period at a CAGR exceeding 15%. This can be attributed to the gradual opening up of the market for next-generation tools to plug data leaks against a backdrop of mega trends including virtualization, Internet of Things (IoT), and consumerization of enterprise IT.
Further, the advancements in the IT & telecom sector, such as the advent of BYOD and CYOD, along with expanding cloud infrastructure and adoption of cloud storage solutions by several companies are expected to impact the growth significantly over the eight years. The establishment of new businesses in the developing economies is further anticipated to propel the demand for cloud-based solutions.
The cloud solutions segment is expected to witness growth at a CAGR exceeding 19% by 2024. Data storage is one of the major resources for several industries including banking & financial, retail, and others to move to the cloud. This is owing to the flexibility it offers in terms of scalability and usage policy.
However, the adoption of cloud has necessitated the safeguard of the crucial data. Enterprises are progressively adopting big data analytics to find hidden insights to their data due to which major Internet services and applications are aggressively adopting the cloud encryption software to ensure that their users’ content remains private. The growing mobile theft and cyber-attacks have led to mandated regulatory standards related to data transfer and its security.
The BFSI segment accounted for a sizeable market share in 2015 and is expected to witness growth at a CAGR of over 15% by 2024. Banks traditionally use techniques including email, DVDs, and others for the data transfer, which pose a high risk of data breach, thus propelling the growth opportunities in the industry. The rising cyber-attacks and the dynamic nature of security industry has escalated the need to safeguard critical and delicate financial data from breaches with maximum returns and minimum risks.
As the banking institutions are moving towards cloud, the segment is exhibiting a higher potential for the deployment of these security solutions. Furthermore, the growing importance and high dependence on online transactions are expected to drive the adoption of the encryption software in the BFSI sector over the next eight years.
Asia Pacific accounted for over USD 500.0 million in 2015, which is estimated to increase over the forecast years ascribed to the lack of storage infrastructure encouraging the organizations to store data on the cloud. This raises the risk of data thefts and loss, escalating the market demand. Furthermore, the growing penetration of BYOD, IoT and cloud services has impelled the industry demand. Rapid developments in the manufacturing sector in countries such as India and China as well as the growing retail and IT & telecom sectors are estimated to drive the market growth by 2024.
The surge in the number of small-sized and medium-sized businesses in countries including China, India, and Japan are putting in efforts to secure personal and business data to emphasize more on their core operations. This is anticipated to catapult the demand for encryption software significantly over the forecast years.
The evolving customer-buying behavior is also anticipated to elevate the product adoption significantly in the region. Furthermore, the increasing technology penetration in these regions is expected to add up to the escalating growth of the encryption software. Asia Pacific is also expected to exhibit a high growth rate by 2024, which can be attributed to the increasing government funding to meet the healthcare needs of the region.
The industry is fragmented in nature. The key players include Symantec, Microsoft Corporation, Bloombase, Cisco Systems, EMC Corporation, Check Point Software Technologies, IBM Corporation, Intel Security, Trend Micro, and Sophos. These players offer data protection solutions to the Small & Medium Businesses (SBMs) and enterprises. Furthermore, the companies also focus on the development of innovative techniques related to the advanced cryptography to provide robust data security.
This report forecasts revenue growth at global, regional, and country levels and provides an analysis on latest industry trends in each of the sub-segments from 2014 to 2024. For the purpose of this study, Grand View Research has segmented the global encryption software market report on the basis of deployment, application, end-use, and region:
Deployment Outlook (Revenue, USD Million, 2013 - 2024
Application Outlook (Revenue, USD Million, 2013 - 2024)
Web Communication Encryption
Network Traffic Encryption
End-Use Outlook (Revenue, USD Million, 2013 - 2024)
Government & Public Administration
Defense & Aerospace
Regional Outlook (Revenue, USD Million, 2013 - 2024)
Middle East & Africa
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