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IBM challenges ‘pure-play’ security software vendors in global rankings Featured

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IBM pushed past Trend Micro to jump into third place in revenues in the global security software market last year, the first time in many years that a non pure-play security vendor has reached the top three in the security market.

According to the latest report from analyst firm Gartner, worldwide security software revenues in 2013 totalled US$19.9 billion, a 4.95% increase from 2012 revenues of $19.0 billion, with the top four vendors now accounting for 39% of the total market.

IBM was ranked third behind top billing security vendors Symantec and McAfee.

Symantec and McAfee respectively recorded revenues in 2013 of $3,738 million (down 0.3%) and $1,745 million (up 3.9%), while IBM’s revenues for the 12 months jumped to $1.135 million, up by 19% from just over $954 million in 2012.

Despite its marginal drop in revenues over 2012 – and McAfee’s growth of 3.9% -  Symantec remains the clear market leader with a 2013 marketshare of 18.7%, ahead of McAfee with 8.7%, and IBM now holding a marketshare of 5.7%. Trend Micro’s growth slipped back in 2013 by 5.3% to give it a total marketshare of  5.6%, marginally behind IBM.

Top Security Software Vendors, Worldwide, 2012-2013 (Millions of Dollars)

Company

2013 Revenue

2013 Market

Share (%)

2012 Revenue

2013-2012

Growth (%)

Symantec

3,737.6

18.7

3,747.1

-0.3

McAfee

1,745.3

8.7

1,680.0

3.9

IBM

1,135.8

5.7

953.6

19.1

Trend Micro

1,110.2

5.6

1,172.0

-5.3

EMC

760.0

3.8

717.6

5.9

Others

11,483.1

57.5

10,766.2

6.6

Total

19,972.0

100.0

19,036.5

4.9

Source: Gartner (May 2014)

According to Gartner, the lower-than-expected growth in 2013 was due to commoditisation of key sub-segments and the decline in growth for two of the top five vendors.

"The market experienced slower, but still healthy, growth in 2013,” said Ruggero Contu, research director at Gartner.

“This slightly tempered growth was partly due to the increased commoditisation of the endpoint security (particularly consumer endpoint software) and secure email gateway subsegments that in 2013 accounted for around 25% of the total security software market."

According to Contu, overall, the larger trend that emerged in 2013 was that of the “democratisation of security threats, driven by the easy availability of malicious software and infrastructure (via the underground economy) that can be used to launch advanced targeted attacks.”

Contu says that this ubiquity of security threats has led organisations to realise that traditional security approaches have gaps, “thereby leading them to rethink and invest more in security technology."

"The consequent involvement of the business in security purchase decisions has both a positive and negative effect on software vendor revenue. With every company becoming a technology company, more organisations are now looking to leverage a multitude of data points to become more competitive. This desire to become more digital brings with it its own challenges in terms of securing this data to prevent data breaches and to protect against advanced targeted attacks."

And, from a regional perspective, the top three regions ranked by year-over-year growth were Emerging Asia Pacific (12.8%), Greater China (11%) and Eurasia (9.3%).

According to Gartner’s Contu, there are many factors in regards to the high growth in these regions.

“Fast-growing regions start off from a smaller base when compared with more mature markets; some of these regions have a strong presence of local or regional vendors, which has presented unique challenges to established vendors as they plan their go-to-market strategies for these regions, particularly Greater China.

“The good growth in China's consumer security market is primarily due to the inclusion of advertising revenue sold through free endpoint security software, which is a popular revenue generating method for vendors in the China market.”

Gartner also reports that the three largest regions (North America, Western Europe and Mature Asia/Pacific) accounted for 83% of the total security software market in 2013, but displayed a cumulative growth of 4.1%, slightly below the market average of 4.9%.

"The slower-than-average growth for security software in mature markets is due to the saturation of key segments of the technology market and the highly competitive nature of security deals, driven by an expansion of vendor capabilities into adjacent areas and the continuation of mergers and acquisitions (M&As)," Contu said.

"Additionally, the high penetration rate of consolidated and mature technology areas such as consumer security software, endpoint protection and secure email gateway, has resulted in increased pricing pressure, along with the bundling of capabilities in suite offerings in the identity and access management (IAM) space (user provisioning [UP] and Web access management [WAM]), which leads to a slowdown in discrete new license revenue."

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Peter Dinham

 

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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