Internet of Things security focuses on protecting your internet-enabled devices that connect on wireless networks. IoT security is the safety component striving to protect IoT devices and networks against cybercrime.
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In light of the higher internet penetration, the Internet of Things technology is witnessing significant development. As stated in ‘The Mobile Economy 2020’ published by GSM Association, the number of devices connected to the internet — i.e., the IoT connections — are anticipated to reach 25 billion in the year 2025 from 12 billion in 2019. In a few years, the broader implication of the IoT devices will ultimately tie machines to machines and link people to essential resources, thereby streamlining the operational workflow and benefitting people. However, massive dependence on connected devices has bolstered the risk of cyber threats.
As stated by the Cyber Security Report 2020 published by CheckPoint Software Technologies, 67% of the enterprises have faced a cybersecurity threat, and almost 34% of the cybercrimes are made by insiders. However, the utilization of cybersecurity tools and techniques will provide added security to the IoT applications, thereby, fostering the growth of the global IoT cybersecurity market.
Wearable technology or smart wearables comprises microcontrollers or sensors fitted into the accessory worn close to the skin. The ability of the types of wearables such as smartwatches, fitness trackers, head-mounted displays, sports watches, smart jewelry, smart clothing, and implantable to detect the changes in the body and provide feedback to the wearer has increased their popularity. Additionally, as stated by a report named ‘Wearables 2019’ published by eMarketer, the United States wearable market was valued at USD 56.7 million in 2019 and is expected to reach USD 67 million by 2022.
Further, the latest innovations in wearable technology have been successful in sensing and analyzing various factors. Thus, the higher adoption rate of wearable devices due to the ability to recognize, interpret, process, and simulate changes in the human body has increased the amount of transfer of personal data over the internet. Nonetheless, it has increased the risks of the data breach and the number of cybercrimes, further urging the need to adopt effective cybersecurity for connected devices across the industry verticals.
Higher adoptions of free security services have restrained the growth of the market. The free services provided by the companies mainly offer basic features that help protect the devices from small threats. Companies such as Kaspersky, Avast Free Antivirus, AVG Antivirus, Bitdefender Antivirus, Sophos Home, Microsoft Windows Defender Security Center, and Avira, among others, provide basic features such as on-demand malware scan, on-access malware scan, malicious URL blocking, and phishing protection among others.
Further, as per RM analysis, the lack of complete protection opens up the new security holes of the operating system and networking applications to hack. It is anticipated to give the viruses another entry point that bypasses the antivirus software. Besides, the proliferation of fake antivirus software coerces the users to click on certain links or to make certain payments that may lead to a cyberattack. However, the increasing rate of free services used for the household and small enterprises has restrained the growth of the market.
The network security sub-segment is anticipated to grow at a faster rate during the forecast period. It includes the hardware and software technologies that protect the integrity and usability of the network and the data. However, the vulnerability of the network to accidental damage and malicious use has bolstered the segment. For instance, on March 31st, 2020, the data of 5.2 million guests of Marriot Properties was exposed, hacking the credentials of two employees.
On December 19th, 2019, the data breach revealed more than 267 million Facebook IDs, Facebook usernames, and phone numbers. As stated by the ‘Cost of the Data Breach Report–2019’, published by IBM Security, the global average data breach cost rose from USD 3.62 million in 2017 to USD 3.92 million in 2019.
Based on application, the smart home and wearables sub-segment caters to the maximum share in the application segment of the global IoT cybersecurity market due to the large deployment of the connected device. The massive spending on smart homes and smart wearables has led to the research and development that has penetrated largely the market.
With a minimum of 10 connected devices, smart homes have become complex IoT environments. Their connections with smart applications make them easy to use and a simple target for hackers. Additionally, the market of smart wearables such as smartwatches and body-worn devices (earphones) has bolstered shortly. Further, the smart homes and smart wearables segment is gaining traction in North America and Asia-Pacific region, owing to the presence of advanced technological infrastructure in the U.S. and Canada and certain developed APAC regions, such as Japan, Singapore, Vietnam, South Korea, and Australia, among others.
Geographically, the IoT cybersecurity market has been categorized into five different regions, namely North America, Europe, Asia-Pacific, the Middle East and Africa (MEA), and Central and South America and the Caribbean. Among these, North America is expected to govern a large share of the global market, whereas the Asia-Pacific is the region that is set to exhibit rapid growth outpacing the rest of the regions in the market.
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North America dominates the IoT cybersecurity market on account of the presence of several key players such as ESCRYPT Embedded Systems, Cisco Systems, Harman (TowerSec), Trillium, and Guardtime, among others. Besides, the technologically developed network, burgeoning number of cloud services, and the rising number of Internet users have altogether bolstered the growth of the market in the region. As per the ‘CISCO Annual Internet Report, 2018’, the number of internet users in the region is expected to be 92% of the total population by 2023.
The advanced technical infrastructure has led to a boom of the IoT in smart wearables, smart homes, and the healthcare sector. As stated in the report published by CompTIA Properties, LLC entitled 'IT Industry Outlook,' the U.S. technology industry is forecasted to reach approximately USD 1.7 trillion by the end of 2020. Additionally, North America is home to an advanced healthcare system. The effective utilization of IoT devices and software technology such as EHR, EMR, and telehealth, among others, has propelled the growth.
Asia-Pacific region is anticipated to grow at a faster rate, owing to the increasing number of internet connections due to favoring government initiatives such as the Digital India Campaign launched by the Government of India, the Digital Economy Promotion Agency, by the Government of Thailand, and others. Additionally, rising government initiatives such as Make in India by the Government of India and government investments such as the USD 21 billion funds set up by the Chinese government in November 2019 to support manufacturing technology have stimulated the growth of small and medium-sized enterprises in the region.
The market can be termed as a perfectly competitive market with five established players operating in the global market holds nearly 42% of the total market share. Whereas, the rest of the global players and also domestic level market vendors account for a share of 62% in the global market. So, as per our analysis and looking at the opportunities for the local vendors with 62% of the market share up for grabs the market can witness the entry of numerous players in the IoT cybersecurity market.
For instance, in a developing country, such as India, the IT market is observing a significant boom which can increase opportunities for IoT enabled devices and thus security solutions for safer operations of the products.
The aforementioned market concentration provides a perspective on the performance of the global market. The regional markets and performance of these players across these regions may perform very differently majorly due to the revenue consolidation in a particular region and lack of operations across certain regions. For instance, the market of China will have a variety of companies offering their products and increasing the intense level of competition.
The prominent manufacturers identified across the value chain of the IoT cybersecurity market are ESCRYPT Embedded Systems, Arilou Technologies, Cisco Systems, Inc., HARMAN International, Argus Cyber Security Ltd., BT, Trillium Technologies Pte Ltd., Secunet Security Networks AG, Karamba Security, Guardtime, Utimaco TS GmbH, NXP Semiconductors, Intel Corporation, and SBD Automotive & Ncc Group, among others.