Published on: December 09, 2019
The global industrial cybersecurity market is mainly driven by the increased adoption of Industry 4.0 technologies. Further, the increase in digital exposure of industries with the advent of advanced technologies such as AI, ML, IoT, and cloud to enhance operational efficiency will also increase the demand for industrial cybersecurity solutions. Manufacturing companies are increasingly adopting Industrial IoT (IIoT) which increases the number of connected devices on a network which in turn increases the threat from cybercriminals.
The rise in digitalization of the business processes and industrial equipment has increased the risk of cyberattacks in the manufacturing sector. Manufacturing companies are increasingly more prone to cyberattacks and data breaches. For instance, in April 2019, a data breach that happened at Toyota Motor Corp. exposed the personal information of 3.1 million customers.
The global industrial cybersecurity market is expected to be over USD 23 billion by 2024, growing at a CAGR of over 8% between 2019 and 2024. The global industrial cybersecurity market is categorized as a part of the systems software market. The global systems software market covers organizations that are engaged in developing application development and management software, cloud computing software, data center and hosting software, IT management software, mobility software, networking software, security software, and storage software.
Based on geography, the North America region has the dominant market share driven by multiple factors including the presence of major vendors, high technology adoption, and rising adoption of IoT technologies.
The global industrial cybersecurity market can be segmented into the following:
Many factors are expected to drive growth in the industrial cybersecurity market during the forecast period. Our analysis identifies the following factors to be driving the growth in the industrial cybersecurity market:
IoT refers to a system of interrelated devices or things embedded with electronics, software, sensors, and network connectivity. It involves machine-to-machine (M2M) communication that enables devices to exchange and act upon information by eliminating human-to-human or human-to-computer interaction. The data collected from these devices can be analyzed to optimize services, products, and operations. IoT acts as a bridge between the physical and the virtual world by linking objects and data to provide connectivity. Industrial IoT (IIoT) is the extension of IoT technologies for industrial applications.
The increasing adoption of the industrial internet of things (IIoT) has led to a rise in the use of smart sensors and actuators. In IIoT, components such as servers, workstations, and other devices are connected in a network, which includes multiple endpoints that could be wearable fitness devices, industrial control systems, automotive telematics units, or drone units. An enterprise typically generated sensitive information of users such as personal and financial data.
These criminals could hack into secure networks of companies to steal intellectual properties (IP) that consist of data from product proposals to digital prints and trade secrets to proprietary manufacturing processes. Device manufacturers also need to adhere to data protection standards such as GDPR to protect users’ data. Along with cybersecurity solutions such as firewalls to protect the data-at-rest, enterprises must also ensure the security of data-in-transit.
Thus, the growing adoption of IIoT devices in the industrial and manufacturing sectors will drive the demand for industrial cybersecurity solutions during the forecast period.
Industry 4.0 is a standard that refers to the integration of automation technologies and advanced techniques such as IoT with the manufacturing system. It was developed by the German government to promote digitalization in industrial practices and reduce their cost of operations and enhance operational efficiency. In May 2017, the European Commission launched a project named Smart Factories in the new EU member states. The aim of this project is to build a network of Digital Innovation Hubs in the region, which will help several companies (primarily SMEs) to access expertise as well as develop and test new digital technologies. Industries are increasingly integrating advanced technologies such as IoT, AI, ML, and cloud for multiple applications from data analytics, to automation and predictive maintenance. The popularity of Industry 4.0 will drive the digitization of factories which in turn will create the demand for the industrial cybersecurity market.
The manufacturing and industrial sectors are actively focusing on integrating new technologies, such as IoT and big data analytics to increase their productivity and reduce operational complexities. Companies are deploying a high number of digital sensors in their production and manufacturing facilities across businesses. The increasing large-scale deployment of IoT devices and sensors in the industrial sector has resulted in the generation of large volumes of sensitive data, such as asset value, and equipment monitoring data, among others.
The interconnection of multiple technologies and the adoption of cloud services to support computing and storage demands for these deployments are leading to concerns related to data and device security. For example, in 2018, Saipem Spa (Saipem), an Italian oil services company, identified a cyberattack on its servers in India, Italy, and the Middle East, which led to an interruption in business operations. Legacy network infrastructure may not be capable of helping enterprises to handle the threats in the industrial and manufacturing sectors.
With the popularity of IIoT, the number of connected devices is only growing during the forecast period, which will drive the demand for industrial cybersecurity solutions.
Meanwhile, the vendors operating in the market face numerous challenges in increasing their sales and improving profitability. Some of those challenges are:
Industries have invested a significant amount of financial and human resources for the implementation and maintenance of old legacy systems and infrastructure. As a result, organizations are reluctant to shift from an older legacy system and invest in new innovative software solutions. System integration and interoperability are the major technology-related challenges faced by industries. Existing systems must be upgraded to ensure they can be integrated with advanced technologies such as cloud and IoT while at the same time ensure security and seamless flow of data. Despite the availability of more cost-effective technology, enterprises prefer to continue the existing IT systems that are running on legacy platforms. Other limitations associated with legacy infrastructure are the lack of customization and the need for frequent hardware upgrades. This could impact investments toward industrial cybersecurity solutions.
Industrial cybersecurity solutions are expensive due to the high costs associated with planning, designing, development, licensing, and deployment. Often, industries require customization about their focus sector and equipment. The process of deploying security solutions for all devices, equipment, and processes is time-consuming and incurs high cost. The high price of security software could restrict or delay industries from purchasing such solutions, which will negatively impact the industrial cybersecurity market.
Concerns about cybersecurity are increasing due to the rise in the volume of digital information that consists of sensitive information such as equipment and process-related data. The number of cyberattacks has increased in the past decade. In many cases, the enterprises are not aware of the data breach for a prolonged period of time. The nature and complexity of cyberattacks and data theft have also been changing over the past decade. Such changes or new cyber threats create a need for advanced solutions and skilled workforce that can identify attacks in advance before it paralyzes business operations. With the changing cybersecurity landscape, there is a need for advanced proactive hunting solutions and experienced security personnel who are well-versed in tools, techniques, and procedures (TTPs) of the attackers to perform behavior matching.
However, as per the non-profit IT security organization (ISC)², in 2018, there was a shortage of 3 million cybersecurity professionals globally. According to (ISC)² cybersecurity experts, organizations have limited expertise in advanced security solutions and inadequate awareness about the changing threats. Thus, the lack of awareness and skilled workforce hinder the adoption of industrial cybersecurity solution during the forecast period.
Our reports on the industrial cybersecurity market cover several large and small vendors active in the market including AO Kaspersky Lab, Symantec Corp., McAfee LLC, Rockwell Automation Inc., Cisco Systems Inc., IBM Corp., and ABB Ltd.
Acquisitions and introduction of new technologies and products are some of the strategies adopted by the companies in the global industrial cybersecurity market.
Following are a few of the major developments in the market:
Backed with competitive intelligence and benchmarking, our industrial cybersecurity market research report is designed to provide entry support, customer and M&A assessment, as well as go-to-market strategy support.
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