The global Internet of Things (IoT) security market size was valued at USD 1.24 billion in 2017. It is likely to rise at a CAGR of 29.7% during the forecast period. IoT is one of the most significant technology trends and has enticed the attention of several companies across the globe. With the growing incorporation of IoT products in wireless networking, artificial intelligence, and machine learning coupled with the development of sensors and microcontrollers, the need for security for reliable operations of the technology is becoming necessary.
Increased use of connected IoT technologies has left organization networks and devices vulnerable to security breaches, thereby driving awareness regarding cyber-attacks among consumers as well as businesses. Thus, addressing security challenges within the IoT space is anticipated to stoke the growth of the market over the forecast period.
Smart devices with networking and computational capabilities are enhancing hospitals, homes, cities, and the manufacturing industry. The emerging network of connected devices is offering improved energy efficiency, enhanced management of patients, and optimized manufacturing processes. Despite these many benefits, security vulnerabilities in these systems are leading to users with dissatisfaction.
The proliferation of connected devices is leading to massive generation of data used for enabling the creation of new business models such as Products-as-a-Service (PaaS) or automated real-time decision making. Such rapid developments within the IoT ecosystem are opening new vectors of attack, such as device manipulation, data & identity theft, data falsification, IP theft, and network manipulation, for hackers. With the growing significance of IoT in corporate and government as well as critical infrastructure, privacy and security concerns are rapidly increasing, thereby augmenting the market.
Security is an essential aspect of complex IoT environment. Whether accidental or malicious, malfunctioning of connected devices such as components of smart grids or connected cars can pose a significant risk to businesses and consumers as well as society. IoT has created issues such as privacy violations and monetary loss (for instance, denial-of-service attacks or ransomware) within devices, networks, cloud, infrastructure, applications, and services. Therefore, the soaring need for preventing fraud and sabotaging cyberattacks is providing a significant push to the market.
On the basis of component, the market is bifurcated into solutions and services. The solution segment accounted for approximately 63.0% of the overall market in 2017 and is expected to maintain its position in the market through 2025. As new IoT vulnerabilities are frequently surfacing and multiple IoT devices are being compromised with botnets and other malicious software, the need for security solutions is escalating. They offer robust security architecture to IoT devices. Moreover, security integration with machine learning and analytics are poised to trigger the growth of the segment during the forecast period.
Identity and access management (IAM) dominated the IoT security solutions market in 2017 with a revenue share of 32.7%. IAM covers the complete spectrum of users and their digital identities, data captured by them, its protection, and authorization access for desired information. Growth in risk management such as audit management, policy-based compliance, and web-based applications, combined with cost containment, is one of the primary factors fueling the demand for IAM solutions.
Encryption solutions are estimated to experience the highest CAGR of 35.9% over the forecast period. Encryption layer enables greater data security for IoT devices. Increasing the need to protect sensitive information such as financial transactions and personal data in non-secure storage is projected to stimulate the growth of the segment. Furthermore, regulatory compliance, data privacy concerns, and brand reputation are potential factors driving the need to improve data security, thereby encouraging the growth of the segment over the forecast period.
The professional service segment is anticipated to lead the IoT security services market through 2025, registering a CAGR of 28.3% over the forecast period. Need for end-to-end security services such as assessment, policy & management, secure by design, and test & evaluation are some of the key factors escalating the growth of the segment. As IoT is emerging as a key component in an enterprise, professional IoT security services are anticipated to maximize the potential of the business by providing robust security in a wireless network environment.
The endpoint was the most prominent security type segment in 2017 and was valued at USD 405. 5 million. IoT is rapidly gaining popularity in small as well as large organizations and implying massive personal information over cloud platform results in the opening to exploitable vulnerabilities. Thus, organizations need to integrate appropriate security measures to secure cloud infrastructure from threats and cyber-attacks. Hence, increasing IT security spending is supplementing the growth of the market.
On the other hand, the application segment is poised to post the highest CAGR in the market during the forecast period. The rapid development of mobile, web, and IoT-based applications for businesses is likely to drive the growth of the segment. Furthermore, growing number of cyber-attacks, which pose a direct threat to business reputation and profitability, is playing a pivotal role in augmenting the overall IoT security market.
Smart home & consumer dominated the market in 2017. It is anticipated to reach USD 2.93 billion by 2025. Substantial year-over-year growth in the number of the connected homes is leading to increasing in the adoption rate of products such as smart fire & alarm systems, intelligent security systems, and smart electronics in developed countries such as the U.S., Canada, and the U.K. The high importance of IoT systems in smart home and consumer electronics has increasingly necessitated security solutions and services. Growing privacy concerns and mounting cases of cyber-attacks such as data & identity theft and denial of service (DoS) are driving the market.
The infrastructure & cities segment is projected to expand at the highest CAGR of 31.9% over the forecast period. The growing implementation of connected devices in smart cities and smart building as well as in HVAC, temperature controller, and electric vehicle is bolstering the need for robust security solutions. For instance, as IoT and machine learning progress towards enabling smarter building infrastructure, the need for cyber-resilience is expected to open numerous opportunities for IoT security vendors.
The North America market was valued at USD 442.4 million in 2017. Early adoption of IoT security technologies in various applications such as healthcare and retail has propelled the market. Higher spending capabilities of organizations to invest in premium IoT security solutions and services are contributing to the growth of the market. Growing venture capitalists in the market are providing opportunities for new entrants. For instance, in April 2018, Armis, a U.S.-based IoT security startup raised USD 30 million in Series B funding.
Asia Pacific is estimated to register the highest CAGR of 34.6% over the forecast period. Countries such as China, India, and Australia are developing and scaling IoT-based initiatives such as smart grids and smart cities. Such actions would generate a significant amount of data, which would increase government’s responsibility to secure the stored information. This will enforce governments to build robust data protection policies for ownership of data and liability for any damage caused to the user of an IoT technology.
The market is fragmented in nature. It was dominated by Cisco Inc. in 2017. The top 10 market players accounted for over 35.0% of the overall market in the same year. Prominent vendors are continuously engaged in research and development activities to provide high quality and reliable products. Furthermore, they are focusing on mergers and acquisitions in order to provide consumers with advanced security solutions. Furthermore, small players and startups are trying to come up with innovative offerings in order to gain visibility in the market, wherein large companies with enhanced financial and technological capabilities hold prominent positions.
With growing IoT cyber-attacks, governments across nations are anticipated to implement stringent policies in the IoT ecosystem, thereby creating challenges for IoT vendors. IoT security companies are adopting secure by design policy, which is enabling them to stay ahead of the competition. Some of the key industry participants operating in the market are Cisco Systems Inc.; Gemalto NV; IBM Corporation; McAfee, LLC; and Symantec Corporation.
Base year for estimation
Actual estimates/Historical data
2015 - 2016
2018 - 2025
Revenue in USD Million & CAGR from 2018 to 2025
North America, Europe, Asia Pacific, Latin America, and MEA
U.S., Canada, U.K., Germany, France, Spain, China, India, Japan, ANZ, ASEAN, South Korea, Brazil, Mexico, GCC Countries, Israel, and South Africa
Revenue forecast, company ranking, competitive landscape, growth factors, and trends
15% free customization scope (equivalent to 5 analyst working days)
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This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the industry trends in each of the sub-segments from 2015 to 2025. For the purpose of this study, Grand View Research has segmented the global IoT security market report on the basis of component, solution, services, security type, application, and region:
Component Outlook (Revenue, USD Million, 2015 - 2025)
Solution Outlook (Revenue, USD Million, 2015 - 2025)
Data Loss Protection (DLP)
Identity and Access Management (IAM)
Unified Threat Management (UTM)
Services Outlook (Revenue, USD Million, 2015 - 2025)
Security Type Outlook (Revenue, USD Million, 2015 - 2025)
Application Outlook (Revenue, USD Million, 2015 - 2025)
Healthcare & Life Science
Infrastructure & Cities
Industrial system & Sensors
Smart home & Consumer
Transport & Urban Mobility
Regional Outlook (Revenue, USD Million, 2015 - 2025)
Australia New Zealand
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Amidst the COVID-19 crisis, the network security industry is poised for sustainable growth despite the foreseeable economic turbulence. Implementation of remote working policy, due to lockdown is putting unanticipated stress on remote networking technologies and causing operational technology (OT) security risk concerns over the vulnerable home network security. Furthermore, as digital infrastructure becomes a critical aspect of business strategic considerations, network security will become a competitive differentiator for businesses and overhaul their remote working strategies. We are incessantly monitoring the market dynamics and regulations while continuously assessing the impact of Covid-19 with the aim of providing you with actionable market insights. The report will account for Covid19 as a key market contributor.