Worldwide spending on security-related hardware, software and services will grow from $73.7 billion in 2016 to $101.6 billion in 2020, according to new research from International Data Corp.
The rise in expenditures to bolster security represents a compound annual growth rate (CAGR) of 8 percent, more than twice the rate of overall IT spending growth, during the five-year forecast period.
"Today's security climate is such that enterprises fear becoming victims of the next major cyber attack or cyber extortion," said Sean Pike, program vice president of security products at IDC. "As a result, security has become heavily scrutinized by boards of directors demanding that security budgets are used wisely and solutions operate at peak efficiency."
The industries making the biggest investments in security solutions in 2016 will be banking, followed by discrete manufacturing, federal/central government, and process manufacturing. These four industries will account for 37 percent of worldwide security revenues this year and will remain the largest industries in terms of total spending throughout the five-year forecast, IDC said.
The industries that will see the fastest growth in their security investments will be healthcare, telecommunications, utilities, state/local government, and securities and investment services. Each of these industries will experience CAGRs above 9 percent over the forecast period.
The largest category of investment will be security-related services, which will account for nearly 45 percent of all security spending worldwide in 2016, the report said. The largest segment, managed security services, is forecast to generate revenues of $13 billion this year.
Security software will be the second largest category this year, with endpoint security, identity and access management, and security and vulnerability management software driving more than 75 percent of the category's revenues. Security hardware revenues will reach $14 billion in 2016, led by purchases of unified threat management systems.
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