IT Security Market Report 2007

UK expenditure on IT security products and services was worth an estimated £2.3bn in 2006, having increased by 26.9% during the year. If companies' internal spending on IT security is included, the figure rises to £3.29bn.

Spending on IT security (both internal and external) is taking a growing share of IT budgets. Organisations are beginning to understand the importance of IT security, although a large number of UK businesses still regard it as an overhead, rather than an investment. IT security's increasing share of total IT expenditure is the result of a continuing rise in the number, variety and sophistication of threats faced by organisations. Changing business practices, such as outsourcing, globalisation, teleworking and e-business, have led to the development of distributed corporate structures and greater networking of computers within and between organisations, making modern IT systems more vulnerable to attack.

To reduce the points of vulnerability in a system, organisations are increasingly looking to buy integrated platforms/appliances, rather than stand-alone security products. In addition to this, many organisations are adopting a multi-layered approach to security, which combines solutions such as desktop anti-virus, server and gateway anti-virus, content filtering, and pro-active techniques such as behaviour analysis and heuristics.

The importance of networking means that modern computer systems must allow access, but in a controlled manner, so an increasing emphasis is being placed on identity and access-management solutions. As the use of wireless and remote networking grows, securing mobile and wireless devices is also becoming more important.

Spending on IT security products and services is forecast to show strong growth between 2007 and 2011. The main growth areas will continue to be: products and services that offer a strong return on investment and make security more manageable; wireless and application security solutions; security audits and penetration testing; role-based access-control solutions; biometric technology; products and services that enforce corporate policy, comply with privacy regulations and limit legal liability; content-management software; outsourcing; and security appliances. SHOW LESS READ MORE >

Executive Summary

1. Market Definition

REPORT COVERAGE

MARKET SECTORS

Security Products

Table 1: The Main IT Security Products
and Their Functions, 2006

Security Services

MARKET TRENDS

The Communications Society

Table 2: Use of Communications Technology
(% of UK businesses), 2002, 2004 and 2006

Access Control and `Spyware'

Protecting Existing IT Investments and Digital Assets

Table 3: The Proportion of UK Businesses That Would
Suffer Significant Business Disruption if Information Were Corrupted or Not Available (%), 2002, 2004 and 2006

The Threat of VoIP Security Attacks

Political Influence

The Prevalence of Security Breaches

Table 4: The Proportion of UK Businesses That Had an Information Security Incident in the Last 12 Months
(%), 2004 and 2006

Table 5: The Main Causes of Information Security Incidents
in the Last 12 Months (% of UK businesses affected),
2004 and 2006

Table 6: The Causes of the Worst Information Security Incidents Suffered by UK Businesses in the Last 12 Months
(%), 2004 and 2006

The Rising Cost of Security Breaches

Table 7: Estimated Breakdown of the Cost of an
Information Security Incident (%), 2004 and 2006

Figure 1: Estimated Breakdown of the Cost of an
Information Security Incident (%), 2006

Table 8: Estimated Cost of UK Information Security Incidents in the Last 12 Months Arising from Pre-Meditated or Malicious Intent (000, %, £bn and £), 2002, 2004 and 2006

ECONOMIC TRENDS

Population

Table 9: UK Resident Population Estimates
by Sex (000), Mid-Years 2002-2006

Gross Domestic Product

Table 10: UK Gross Domestic Product at Current
and Annual Prices (£m), 2002-2006

Inflation

Table 11: UK Rate of Inflation (%), 2002-2006

Unemployment

Table 12: Actual Number of Unemployed Persons
in the UK (million), 2002-2006

Household Disposable Income

Table 13: Household Disposable Income
per Capita (£), 2002-2006

MARKET POSITION

The UK

Table 14: The Share of UK IT Budgets Taken by Spending
on Security (%), 2002, 2004 and 2006

Table 15: The Share of UK IT Budgets Spent on Information Security in the Last 12 Months (%), 2002, 2004 and 2006

Overseas

2. Market Size

THE TOTAL MARKET

Table 16: Estimated UK Expenditure on IT Security
(£m at final selling prices), 2002-2006

Figure 2: Estimated UK Expenditure on IT Security
(£m at final selling prices), 2002-2006

BY MARKET SECTOR

Security Products

Table 17: Estimated UK Expenditure on IT Security Products
(£m at final selling prices and %), 2002-2006

Table 18: Estimated UK Expenditure on IT Security Products
by Type (£m at final selling prices and %), 2004 and 2006

Market Shares

Security Services

Table 19: Estimated UK Expenditure on IT Security Services (£m at final selling prices and %), 2002-2006

Table 20: Estimated UK Expenditure on IT Security Services
by Type (£m at final selling prices and %), 2004 and 2006

Market Shares

3. Industry Background

RECENT HISTORY

NUMBER OF COMPANIES

DISTRIBUTION

HOW ROBUST IS THE MARKET?

LEGISLATION

Data Protection Act 1998

Regulation of Investigatory Powers Act 2000

Lawful Business Practice Regulations

Electronic Signatures Directive/Electronic Communications
Act 2000

Directive 2002/58/EC of the European Parliament

Convention on Cybercrime

Company (Audit Investigations and Community Enterprise)
Act 2004

Codes of Practice

BS7799 — British Standard on Information Security Management

ISO17799 — Information Security Code of Practice

KEY TRADE ASSOCIATIONS

Communications-Electronics Security Group

e.centreUK

European Forum for Electronic Business

European Information, Communications and Consumer Electronics Technology Industry Association

Intellect

Internet Services Providers' Association

4. Competitor Analysis

THE MARKETPLACE

MARKET LEADERS

Accenture

Company Structure

Current and Future Developments

Financial Results

Bull Information Systems Ltd

Company Structure

Current and Future Developments

Financial Results

CA PLC

Company Structure

Current and Future Developments

Financial Results

Check Point Software Technologies (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Cisco Systems Ltd

Company Structure

Current and Future Developments

Financial Results

Computer Sciences UK Ltd

Company Structure

Current and Future Developments

Financial Results

IBM United Kingdom Ltd

Company Structure

Current and Future Developments

Financial Results

Integralis Ltd

Company Structure

Current and Future Developments

Financial Results

McAfee International Ltd

Company Structure

Current and Future Developments

Financial Results

Nokia UK Ltd

Company Structure

Current and Future Developments

Financial Results

RSA Security

Company Structure

Current and Future Developments

Financial Results

Sophos PLC

Company Structure

Current and Future Developments

Financial Results

SunGard Data Management Solutions (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Symantec (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Trend Micro (UK) Ltd

Company Structure

Current and Future Developments

Financial Results

Other Companies

Capgemini UK PLC

Clearswift Systems Ltd

Electronic Data Systems Ltd

Entrust Inc

Fujitsu Ltd

Hewlett-Packard Ltd

Internet Security Systems

Juniper Networks Inc

Microsoft Corporation

Peapod (UK) Ltd

SonicWALL Inc

Surfcontrol PLC

VeriSign Inc

WatchGuard Technologies Inc

WebSense Inc

OUTSIDE SUPPLIERS

MARKETING ACTIVITY

Main Media Advertising

Table 21: Main Media Advertising Expenditure on IT Security Products and Services (£000), Year Ending September 2006

Exhibitions and Trade Shows

CeBIT

Infosecurity Europe

5. Strengths, Weaknesses, Opportunities and Threats

STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

6. Buying Behaviour

CUSTOMER PROFILE

By Company Size

Table 22: UK Business Use of Vulnerable IT Systems
by Type (% of UK businesses), 2006

Table 23: Types and Sources of Help and Expertise on Information Security Issues Sought by UK Businesses
(% of businesses), 2006

Table 24: The Proportion of UK IT Budgets Spent on Information Security in the Last 12 Months (%), 2006

By Industry

Financial Services

Government

Telecommunications and Utilities

Transport and Travel

Other Sectors

Table 25: Expenditure on Security Breach Prevention
by Industry Sector (%), 2006

Figure 3: Expenditure on Security Breach Prevention
by Industry Sector (%), 2006

NEW ORGANISATIONAL DEMANDS

THE CONSUMER AND SME MARKETS CONTINUE TO GROW

7. Current Issues

CYBERCRIME ON THE INCREASE

CONTINUED RISE IN BOT NETWORKS

FINANCIAL GAIN DRIVES MALICIOUS ACTIVITY

HOME USERS UNDER ATTACK

CONTINUED INCREASE IN SPAM MESSAGING

SPAM, PHISHING AND ONLINE FRAUD

FASTER EXPLOITATION OF VULNERABILITIES

HUMAN TROJAN HORSES AND PENETRATION TESTING

DAY-ZERO EXPLOITS

MOBILE AND WIRELESS RISKS

E-VOTING

8. The Global Market

INTERNET SECURITY SPENDING

MARKET DYNAMICS

MARKET TRENDS

Unexpected Rise in Spam Attacks

The Use of `Zombies' in Spam Attacks

Table 26: Geographic Distribution of `Zombies' Used in
a Single Large-Scale Spam Attack (%), 2006

Global Trends in Malware

Table 27: Enterprise Infections by Region and Type of Malware (% of corporate PCs), 2006

Global Endpoint Data Protection

A Worldwide Multi-Layered Approach to Security

9. Forecasts

INTRODUCTION

A Positive Economic Environment

Economic Forecasts

Population

Table 28: Forecast UK Resident Population
by Sex (000), Mid-Years 2007-2011

Gross Domestic Product

Table 29: Forecast Growth in UK Gross Domestic Product
in Real Terms (%), 2007-2011

Inflation

Table 30: Forecast UK Rate of Inflation (%), 2007-2011

Unemployment

Table 31: Forecast Actual Number of Unemployed Persons
in the UK (million), 2007-2011

FORECASTS 2007 TO 2011

Table 32: Forecast UK Expenditure on IT Security
(£m at final selling prices), 2007-2011

MARKET GROWTH

Figure 4: Estimated and Forecast UK Expenditure on
IT Security (£m at final selling prices), 2002-2011

FUTURE TRENDS

Consolidating Industry

From Add-Ons to Integrated Security Solutions

Security Appliances

Mobile Working Will Continue to Threaten IT Security

10. Company Profiles

Bull Information Systems Ltd

Cisco Systems Ltd

Computer Sciences Uk Ltd

Ibm United Kingdom Ltd

Integralis Ltd

Mcafee International Ltd

Sophos PLC

11. Consumer Confidence

METHODOLOGY

KEY FINDINGS THIS QUARTER

THE WILLINGNESS TO BORROW

Confidence Improves

Table A: The Average Amount Consumers Are Willing
to Borrow in Order to Purchase Expensive Items
at Current and Constant November 2004 Prices
(£ and £bn), February 2006-2007

Willingness to Borrow Slips Slightly

Table B: The Number of Adults Willing to Borrow in Order
to Purchase Expensive Items (000 and %), February 2006-2007

SPENDING FROM SAVINGS

Slight Increase in Spending from Savings

Table C: The Average Amount Consumers Are Willing to Spend from Savings in Order to Purchase Expensive Items
at Current and Constant November 2004 Prices
(£ and £bn), February 2006-2007

Saving Grows in Relative Importance

Table D: The Average Amounts Adults Are Confident Spending to Purchase Expensive Items (£ and %), February 2006-2007

12. Further Sources

Associations

General Sources

Government Sources

Other Sources

Bisnode Sources

-Accenture
-CA PLC
-Cisco Systems Ltd
-Computer Sciences UK Ltd
-IBM United Kingdom Ltd
-Integralis Ltd
-McAfee International Ltd
-Nokia UK Ltd
-Sophos PLC
-SunGard Data Management Solutions (UK) Ltd
-Symantec (UK) Ltd
-Trend Micro (UK) Ltd
-Capgemini UK PLC
-Clearswift Systems Ltd
-Electronic Data Systems Ltd
-Entrust Inc
-Fujitsu Ltd
-Hewlett-Packard Ltd
-Internet Security Systems
-Juniper Networks Inc
-Microsoft Corporation
-Peapod (UK) Ltd
-SonicWALL Inc
-Surfcontrol PLC
-VeriSign Inc
-WatchGuard Technologies Inc
-WebSense Inc