Worldwide spending on security products and services will grow at 10.3 percent to $83.5 billion in 2017.
Spending on security-related hardware, software, and services will be $119.9 billion in 2021 with a CAGR of 9.6 percent over the 2016-2021 forecast period, according to IDC.
Threat landscape, regulatory pressures and architectural changes due to digital transformation initiatives are three trends are driving security spending.
“Organizations are actively searching for product and service efficiencies that maximize spend in order to fully address such complex challenges,” said Sean Pike, program vice president for IDC’s Security Products and Legal, Risk, and Compliance programs.
Security spending in 2017
Distribution and services $19.7 billion
Public sector $18.6 billion
Manufacturing and resources $16.4 billion
Financial $16.3 billion
Financial sector will move ahead of manufacturing and resources due to a 2016-2021 CAGR of 10.2 percent.
Public sector security spending will nearly pull even with distribution and services by 2021 with a CAGR of 10.3 percent.
The fastest growing sector over the five-year forecast period will be infrastructure with a CAGR of 11.8 percent.
Banks, discrete manufacturers, and federal/central government agencies will spend the most on security products and services. Combined, these three industries will contribute to 30 percent of the worldwide total spending in 2017.
Federal / central government and banking will see the fastest growth in security spending over the five-year forecast, with CAGRs of 10.9 percent and 10.7 percent, respectively.
Security spending by telecommunications will have a CAGR of 12.6 percent. This growth will enable telecommunications to become the fourth largest industry in terms of total security spend in 2021, moving ahead of the process manufacturing and professional services industries.
IDC said more than 80 percent of security spending in 2017 will go to services and software. Services spending will be led by two of the largest technology categories – managed security services ($15.25 billion) and integration services ($12.5 billion).
Software spending will be focused on three categories – endpoint security, identity and access management, and security and vulnerability management – that will make up more than 75 percent of the software total this year.
Hardware spending will be significantly smaller throughout the forecast, dominated by network security solutions ($13.7 billion in 2017).
Managed security services and network security will also be the fastest growing categories during the 2016-2021 forecast with CAGRs of 14.3 percent and 11.4 percent, respectively.
North America will have a total spending of $37.8 billion this year. Europe, Middle East and Africa (EMEA) will be spending $26.2 billion on security.
Asia Pacific (excluding Japan) will be spending $11.5 billion on security. APeJ will see the fastest growth in security spending over the forecast period with a five-year CAGR of 19.9 percent.
China and Malaysia will see particularly strong growth with five-year CAGRs of 25.3 percent and 20.1 percent, respectively.
Security spending in Latin America is also expected to outperform the overall market with a CAGR of 10.4 percent.