Industrial Cybersecurity: Forging the Way Forward for Increased Digitization
Over the recent years, the industrial cybersecurity market has experienced tremendous expansion and gained significant importance. Increased threat attack surfaces have come from the high prevalence of Industrial Internet of Things (IIoT) technologies in critical infrastructure industries (power utilities, oil and gas, etc.) and the industrial sector. Industrial IoT is not limited to the IT world; it also plays a significant role in operational technology in the industrial world, raising security concerns. Smart energy, smart transportation, and industry 4.0 are the primary segments with heightened risk.
According to a report released by IBM and the Ponemon Institute in 2021, the average cost of a data breach among the industries surveyed was USD 4.24 million per incident, the highest in 17 years. The primary factor driving market expansion during the projection period is an increase in the number of cyberthreats across various commercial sectors. Today, many activities are carried out online, including big data analysis, social networks, information storage and management, and online transactions, to name a few. Due to the rising usage of IT systems, the risk of data privacy and information security has increased. Cybercrime is also on the rise, thanks to the advancement and proliferation of new tools and techniques.
The emergence of large amounts of data is seen as a new path ahead in ICT innovation and industry. Due to the widespread usage of the internet, mobile devices, websites, and social media, big data is becoming increasingly important. This massive volume of data is being created, shared, and evaluated to turn data into knowledge for citizens, industries, and governments. According to industry projections, big data revenue was estimated to reach USD 56 billion in 2020. As a result, the rate of data generation and the necessity to protect it from breaches is expected to drive the market for cyber security solutions.
Public and Private Sector Funds Drive the Industrial Cybersecurity Market
The industrial cybersecurity industry is growing due to increased government support and increased spending by enterprises worldwide to combat cyberattack risks. Digital technology now underpins the vital resources of a country's economy. Cyber threats can interrupt plant operations and IT systems with malware, spyware, and phishing. Governments worldwide are progressively allocating resources to combat security breaches and strengthen industrial cybersecurity.
The US government in 2021 passed an Infrastructure Bill that includes USD 2 billion for cybersecurity funding to help tackle their various cyber issues. Organizations are heavily investing in security software and equipment to protect critical infrastructures, data centers, and industrial control system networks. Google and Microsoft announced plans to invest USD 30 billion in cybersecurity developments over the next five years, as the US government collaborates with private sector businesses to combat national security risks.
The Emergence of Cloud-Based ICS Results in Market Expansion
Industrial units require sufficient space to set up and operate a wide range of interconnected devices and products that function together. Industrial facilities are frequently located outside of cities, posing operational challenges. Industrial units, particularly in poor or rising economies, sometimes lack basic infrastructure. As a result, there are times when delivering OT security is not practicable or possible. In such circumstances, cloud technology allows for OT security. Thus, cloud-based ICS-as-a-service will become increasingly important in industrial regions where the physical deployment of cybersecurity is not possible.
The global industrial cybersecurity market is expected to grow at a CAGR of approximately 10.6% during the forecasted period 2021–2026, with a revenue of USD 17.1 billion in 2020.
Network Security Segment Subjected to Witness Massive Growth
The industrial cybersecurity market is divided into network security, application security, endpoint security, wireless security, cloud security, and other segments on the basis of type. The importance of safeguarding the industrial critical infrastructure networks in the nuclear, chemical, oil and gas, and other sectors has grown as the frequency of cyber-attacks has increased.
Pumps in the eastern United States came to a standstill in early 2021 after the gasoline supply chain was affected due to a ransomware attack on a fuel source. The Colonial Pipeline, which transports 45% of the East Coast's gasoline, diesel, and jet fuel, was hacked by the DarkSide hacking group. The organization took roughly 100 gigabytes of data and demanded a ransom for not releasing it on the internet.
Network security, in general, refers to security products and services used to identify and prevent cyber threats in computer networks and networked resources. Firewalls, intrusion detection systems (IDS), and intrusion prevention systems (IPS), encryption software, identity and access management (IAM), united threat management (UTM), web and e-mail security solutions, antivirus software, and antispyware software are all examples of network security solutions. These technologies assist in protecting data from risks such as SQL injection, cross-site scripting attacks, and DDoS attacks.
Energy and Power Segment Leads the Market
The market is divided into energy and electricity, manufacturing, transportation systems, chemicals, and others based on end-user. The energy and power industry is the most vulnerable to cyber-attacks, and as a result, it will account for the largest market share throughout the projection period. Increased digitalization in the energy and power sector has resulted in numerous economic benefits, including increased efficiency in energy usage reduction, faster processing, and so on. However, as malicious software takes control of energy equipment, resulting in massive data theft, this has increased the potential of cyber-attacks. According to a 2020 cyber security survey, 66% of businesses in the United States were hit by ransomware.
Impact of Covid-19
Industrial cybersecurity solutions and services have always been in high demand since they help firms worldwide secure their data and other confidential information by monitoring and managing various process inputs and outputs at the field site. COVID-19 has compelled company executives to adopt operational models more quickly than before to stay afloat. Due to the widespread adoption of work from home, the use of cloud services and connected devices has skyrocketed, allowing businesses to maintain operations. This move is putting a lot of strain on cybersecurity activities in the industrial sector.
Amid the pandemic, businesses are doing everything to protect their employees and satisfy their customers. The National Cyber Security Center (NCSC) announced in June 2020 that in April, 350 cases of cyberattacks (phishing, fraudulent websites, direct attacks on organizations, etc.) were registered in Switzerland, compared to the standard of 100–150. The increasing cyber-attacks during the pandemic have led to the expansion of the industrial cybersecurity market globally.
North American Dominion Over the Market
Growing cyber risks are the harsh truth of current situations, which cannot be disregarded, and North America owns the highest market share in the worldwide industrial cybersecurity industry. According to a survey conducted by Kaspersky Lab in 2018, roughly 77% of enterprises focus on industrial cybersecurity, while cybersecurity is a minor worry for 21% of industries.
Due to expanding business fundamentals and the need for deployment of Industrial Internet of Things (IIoT) technologies, various enterprises in North America are confronting issues in establishing industrial cybersecurity risk management programs. Furthermore, increased investment by key companies to extend their global presence is likely to drive market growth in North America.
APAC to Hold the Highest Market Share in the Forecasted Period
China and India are examples of developing economies in APAC. These countries have a considerable number of small and medium-sized enterprises (SMEs), which collectively employ more than 70% of the country's total population. Vendors in the industrial cybersecurity industry who supply solutions and services to customers in the manufacturing, transportation, and energy industries might benefit from these SMEs.
The high cost of implementing an industrial control system security project prevents SMEs from implementing strong security practices within their businesses. However, factors such as increasing business complexity, rapid digitization and virtualization, and the growing trend of BYOD are expected to encourage SMEs to adopt various industrial control solutions and services.
The emerging economies in the area, including India, China, Singapore, and Japan, are grappling with rising cybersecurity concerns. India has seen a tremendous rise in cybercrime registrations, placing fifth in the world in terms of overall DNS hijackings. In addition, according to Gemalto, India is responsible for 37% of global breaches in terms of data compromised or stolen. This surge of cyberattacks propels the market to grow at an ever-faster rate boosting the market growth exponentially.
The major companies operating in the market are IBM Corporation, Honeywell International, ABB, Cisco Systems, Symantec Corporation, Kaspersky Lab McAfee, LLC, Dell Inc., Rockwell Automation, Inc., Schneider Electric, Siemens AG. These companies implement several corporate strategies to boost their global expansion and deliver advanced security services.
July 2021- Rockwell Automation and Kezzler AS, cloud-based product digitization and traceability platforms, partnered to support manufacturers in capturing the journey of their products from raw material sources to point-of-sale or beyond cloud-based supply chain solutions that focus on product traceability.
September 2021- Proofpoint Inc. announced the completion of their official review of their partner ecosystem across APAC with the appointment of authorized distributors Ingram Micro(Singapore, Malaysia, Australia, and New Zealand), M.Tech (Singapore, Hong Kong, Vietnam, Indonesia, India, Malaysia, Taiwan, and Australia) and ITSDI (Philippines).
Global Industrial Cybersecurity Market: Segmentation
- Network Security
- Application Security
- Endpoint Security
- Wireless Security
- Cloud Security
- Energy and Power
- Transportation Systems
- North America (the U.S., Canada)
- Europe (Germany, France, the U.K., Italy, Spain, the Netherlands, Rest of Europe)
- Asia-Pacific (China, India, Indonesia, Japan, South Korea, Malaysia, Rest of Asia-Pacific)
- Latin America (Brazil, Mexico, Argentina, Rest of Latin America)
- The Middle East and Africa (GCC, South Africa, Brazil, Egypt, Rest of MEA)