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March 02, 2007

Infonetics Report Predicts Continued Growth for Network Security Gear Through 2007

Demand for next generation communications services such as VoIP and IPTV - coupled with the ongoing convergence of fixed and mobile networks - is leading to much greater network complexity and, subsequently, a growing need for network security solutions. This is evidenced in a recent report from Infonetics Research, which shows that worldwide network security appliance and software sales increased 15 percent to $4.5 billion between 2005 and 2006.

The report predicts that sales of network security equipment and software will pass the $5 billion mark in 2007. However, this growth is expected to slow to the single digits after 2007, as content security gateways and NAC products begin to infringe on network security product budgets.

“The most important appliance category to watch over the next year is secure routers,” said Jeff Wilson, principal analyst at Infonetics Research, in a press release. “Sales were up 25 percent in 2006 and this year will pass $1 billion in worldwide sales, representing a significant portion of the overall network security market. Expect the shift to continue, moving from the price-banded segments of the market to secure routers as they continue to gain acceptance from users.”

Infonetics’ “Network Security Appliances and Software” report provides worldwide and regional market size and forecasts, and worldwide market share, for integrated security appliances including secure routers, SSL VPN gateways, VPN and firewall software, and host- and network-based IDS/IPS products.

Companies tracked include 3Com/TippingPoint, AEP, Alcatel-Lucent, Array, Aventail, Check Point, Cisco, Citrix, CA, D-Link, Enterasys, F5, Fortinet, Juniper, McAfee (News - Alert), NETASQ, Nokia, Nortel, Secure Computing, SonicWALL, Symantec, WatchGuard, ZyXEL, and others.

The report finds that secure routers accounted for 29 percent of the total integrated security appliance market in 2006 and will continue to increase their share of the market through at least 2010. It also finds that global SSL VPN gateway revenue jumped 40 percent in 2006, following a 61 percent increase in 2005. In addition, worldwide IDS/IPS (intrusion detection and prevention systems) revenue grew 19 percent in 2006.

The report also measures the performance of the leading network security equipment manufacturers - and finds that Cisco continued to lead the overall network security market, with 38 percent worldwide revenue share, in 2006. The network gear giant posted growth in all network security market segments tracked. Juniper and Check Point tied for second place, each with 9 percent worldwide revenue, in 2006.

Last year, Infonetics forecast that network security appliance and software revenue would hit $4.4 billion, worldwide, in 2006. Actual revenue was $4.5 billion – a strong testament to the accuracy of the company’s reports.

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Patrick Barnard is Assignment Editor for TMCnet and a columnist covering the telecom industry. To see more of his articles, please visit Patrick Barnard’s columnist page.


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