
Study Period | 2019 - 2030 |
Market Size (2025) | USD 5.24 Billion |
Market Size (2030) | USD 7.85 Billion |
CAGR (2025 - 2030) | 8.43 % |
Fastest Growing Market | Asia Pacific |
Largest Market | North America |
Market Concentration | Low |
Major Players![]() *Disclaimer: Major Players sorted in no particular order |
Network Encryption Market Analysis
The Network Encryption Market size is estimated at USD 5.24 billion in 2025, and is expected to reach USD 7.85 billion by 2030, at a CAGR of greater than 8.43% during the forecast period (2025-2030).
The network encryption landscape is undergoing significant transformation driven by the rapid digitalization of enterprise operations and the evolution of threat vectors. Organizations are increasingly modernizing their network infrastructure with intelligent automation, programmable optics, and advanced software analytics capabilities to create adaptive networks. According to recent industry surveys, over 75% of network providers anticipate implementing significant or full network automation within the next five years, highlighting the growing emphasis on network modernization. This shift is particularly evident in sectors like financial services and healthcare, where the need for secure data encryption transmission has become paramount for maintaining operational integrity and regulatory compliance.
The emergence of quantum-resistant data encryption technologies is reshaping the industry's technological landscape. Traditional encryption methods are being challenged by the advancement of quantum computing capabilities, leading to increased investment in post-quantum cryptography (PQC) solutions. For instance, in 2023, the Technology Innovation Institute's Cryptography Research Centre launched a groundbreaking Post-Quantum Cryptography software library in the UAE, demonstrating the industry's proactive approach to future security challenges. This development is particularly significant as organizations seek to protect their data against both current and future threats.
The convergence of network encryption with cloud security is creating new paradigms in data protection. Recent studies indicate that approximately 93% of organizations in major markets have experienced public cloud security incidents, driving the need for more robust data encryption solutions. This has led to the development of integrated security frameworks that combine traditional network encryption with cloud-native security features. Major cloud service providers are increasingly incorporating advanced encryption capabilities into their core offerings, making enterprise-grade security more accessible to organizations of all sizes.
The industry is witnessing a significant shift in encryption market deployment patterns across various business areas. According to recent enterprise surveys, internet communications and database security have seen the highest adoption rates for encryption technologies, with 63% of organizations implementing extensive deployment for internet communications and 56% for databases. This trend is particularly noteworthy in regulated industries such as financial services and healthcare, where data protection requirements are becoming increasingly stringent. The integration of encryption technologies with emerging technologies like Software-Defined Wide Area Networks (SD-WAN) and Zero Trust Network Access (ZTNA) is creating new opportunities for enhanced security architectures in the network encryption industry.
Network Encryption Market Trends
Increasing Number of Network Security Breaches
The escalating frequency and sophistication of network security breaches have become a critical concern for organizations worldwide, driving the adoption of robust network encryption solutions. Modern high-capacity networks require much more than just high-capacity bandwidth—they need comprehensive security strategies to protect critical encrypted data both at rest and in-flight as it spans the globe, traveling across metro, regional, long-haul, and submarine distances. The increasing sophistication of cyber threats, coupled with the massive amounts of data traffic handled by network infrastructure, has made network security breaches more devastating than ever before. For instance, in 2023, telecommunications networks have become particularly vulnerable to sophisticated attacks, with threats resulting from a combination of typical IP-based threats in an industry with legacy technology.
The expansion of network infrastructure and increasing digitalization have opened new attack vectors for cybercriminals, making data protection paramount for organizations. According to industry experts, as 5G technology advances, the threat surface will only expand, giving attackers more opportunities to exploit vulnerabilities. This has led cybersecurity teams at telecom companies to seek ways to leverage new technology and automation to streamline workflows and stay ahead of attackers. The situation is further complicated by the fact that bandwidth demands continue to rise, necessitating networks that can elegantly scale to handle higher capacities with less operational complexity while maintaining robust security measures. This has made network encryption an essential component of modern cybersecurity strategies.
Increasing Adoption of Cloud Technologies by Numerous Organizations
The widespread adoption of cloud technologies across organizations has created an unprecedented need for secure data transmission and storage solutions, driving the demand for network encryption. As enterprises across regions undergo digital transformation, cloud adoption has brought policies such as BYOD to the forefront in many industries, increasing the number of potential entry points for network breaches. According to recent industry observations, emerging ICT technologies such as smart factories, intelligent transportation systems, distributed ledger technologies, and quantum-safe communication require robust technical and organizational measures to address various threats and risks, making network data encryption increasingly crucial.
The deployment of advanced technologies, particularly 5G networks, has significantly impacted cloud adoption and the subsequent need for network traffic encryption. According to Ericsson, total mobile data traffic is expected to grow from 26 EB per month in 2023 to 73 EB per month in 2029, growing at a CAGR of 19 percent. This massive increase in data traffic, combined with the proliferation of IoT devices and cloud services, has made network data encryption essential for protecting sensitive information. Organizations are increasingly investing in cloud-based solutions while simultaneously seeking ways to ensure data security during transmission and storage. The innovation expansion and adoption of security services across the globe have further boosted the demand for high-speed encryption techniques, particularly as organizations move their workloads and applications to the cloud.
Segment Analysis: Deployment Type
Cloud Segment in Network Encryption Market
The network encryption cloud segment has emerged as the dominant force in the network encryption market, commanding approximately 71% market share in 2024. This is driven by the increasing adoption of cloud-based security solutions across enterprises worldwide. Organizations are increasingly migrating their workloads and applications to the cloud, necessitating robust data encryption solutions to protect sensitive data during transmission and storage. The segment's growth is further accelerated by the rising demand for scalable and flexible encryption solutions that can seamlessly integrate with existing cloud infrastructure. Additionally, the cloud segment is experiencing the fastest growth trajectory, with an expected growth rate of nearly 10% during the forecast period 2024-2029. This is attributed to the increasing realization among companies about the cost-effectiveness and resource efficiency of cloud-based encryption solutions compared to building and maintaining new data storage infrastructure. The segment's expansion is also supported by both large enterprises and SMEs increasingly adopting cloud-based solutions for their encryption needs, particularly in sectors like banking, healthcare, and retail where data security is paramount.

On-premise Segment in Network Encryption Market
The on-premise segment continues to maintain its significance in the network encryption market, particularly among organizations with stringent security requirements and regulatory compliance needs. This deployment type offers organizations enhanced control over their data security infrastructure, providing more flexibility and configurability compared to cloud-based systems. Organizations operating in highly regulated industries or handling extremely sensitive data often prefer on-premise solutions due to their ability to maintain complete control over their security infrastructure and encryption keys. The segment's resilience is further strengthened by its proven track record of fewer recorded instances of breaches compared to cloud-based systems, making it a preferred choice for government agencies, financial institutions, and other organizations with critical security requirements. Additionally, on-premise solutions offer the advantage of customization according to specific organizational processes and regulatory requirements, while eliminating the need for monthly expenses through structured annual or multi-layer plans.
Segment Analysis: Component
Solutions & Services Segment in Network Encryption Market
The Solutions & Services segment dominates the network encryption market, accounting for approximately 64% of the total market share in 2024. This segment's prominence is driven by the increasing demand for comprehensive security solutions that combine software platforms, professional services, and managed security services. Organizations are increasingly adopting cloud-based encryption solutions and services to protect their sensitive data across diverse network environments. The segment's growth is particularly notable in sectors like BFSI, healthcare, and government, where data security requirements are stringent. Major vendors are expanding their service portfolios to include advanced features like automated key management, real-time threat detection, and compliance monitoring. The segment's robust performance is further supported by the rising adoption of encryption-as-a-service models, which provide organizations with scalable and cost-effective security solutions while maintaining high levels of data protection.
Hardware Segment in Network Encryption Market
The hardware encryption market represents a crucial component of the network encryption market, providing the physical infrastructure necessary for implementing robust encryption solutions. This segment encompasses various encryption devices, including network encryption appliances, hardware security modules (HSMs), and dedicated encryption processors. Hardware-based encryption solutions are particularly valued in high-security environments where organizations require tamper-resistant security mechanisms and dedicated encryption processing capabilities. The segment's significance is reinforced by the growing demand for high-speed encryption devices capable of supporting increasing data throughput requirements, especially in sectors like telecommunications and data centers. Organizations are increasingly investing in hardware encryption solutions to ensure data protection at the physical layer, complementing their overall security architecture with robust hardware-based security controls.
Segment Analysis: Organization Size
Large-sized Enterprises Segment in Network Encryption Market
Large-sized enterprises dominate the network encryption market, holding approximately 68% of the market share in 2024. These enterprises invest heavily in network infrastructure security due to their complex data management requirements and extensive digital assets. The segment's prominence is driven by factors such as increasing cloud adoption, rising cyber threats, and stringent regulatory compliance requirements. Large enterprises are particularly focused on protecting customer personal information and maintaining brand loyalty through robust network security measures. These organizations typically implement comprehensive encryption solutions across their vast networks, including cloud storage, data centers, and enterprise-wide communications. The segment's strength is further reinforced by these enterprises' substantial IT budgets and their ability to invest in advanced encryption technologies for securing their extensive digital infrastructure.
SME Segment in Network Encryption Market
The Small and Medium-sized Enterprises (SME) segment is emerging as the most dynamic sector in the network encryption market, projected to grow at approximately 10% CAGR from 2024 to 2029. This growth is primarily driven by the increasing adoption of cloud services and digital transformation initiatives among SMEs. The segment's expansion is further fueled by rising awareness of cybersecurity threats and the growing need to protect sensitive business data. SMEs are increasingly recognizing the importance of network encryption as they handle more digital transactions and customer data. The availability of cost-effective encryption solutions and the rise of managed security services are making it easier for SMEs to implement robust security measures. Additionally, the segment's growth is supported by government initiatives promoting digital adoption and cybersecurity awareness among smaller businesses, along with the increasing integration of IoT devices and automation in SME operations.
Segment Analysis: End-User Industry
BFSI Segment in Network Encryption Market
The Banking, Financial Services, and Insurance (BFSI) sector continues to be the dominant segment in the network encryption market, holding approximately 32% market share in 2024. This significant market position is driven by the sector's high network automation requirements and substantial investments in encryption technologies. The BFSI sector remains particularly vulnerable to data breaches, necessitating constant upgrades in processing and transaction technologies. Financial institutions are increasingly adopting network encryption solutions to secure sensitive data and protect against potential data breaches. The implementation of these solutions has become crucial as network outages continue to plague banking services, highlighting the growing need for robust network automation and security measures. Leading financial institutions worldwide are focusing on strengthening their network security infrastructure through advanced encryption technologies to protect customer data, maintain regulatory compliance, and ensure secure financial transactions.
Media & Entertainment Segment in Network Encryption Market
The Media & Entertainment sector is experiencing substantial growth in the network encryption market, with a projected growth rate of approximately 9% during 2024-2029. This growth is primarily driven by the increasing cloud adoption, growing number of devices connected via networks, and the booming market for over-the-top (OTT) media services. The sector's rapid digital transformation has led to increased bandwidth expansion needs and significant investments in network security infrastructure. The rise in streaming services and digital content delivery platforms has created a pressing need for robust encryption solutions to protect sensitive content and user data. Media companies are increasingly investing in advanced encryption technologies to secure their content delivery networks, protect intellectual property rights, and ensure secure transmission of digital media assets across various platforms and devices. The implementation of sophisticated encryption solutions has become crucial for maintaining content security and preventing unauthorized access to premium content and user information.
Remaining Segments in End-User Industry
The network encryption market encompasses several other significant segments, including Telecom & IT, Government, and various other industries. The Telecom & IT sector plays a crucial role in driving market growth through its extensive network infrastructure and growing need for secure data transmission. The Government sector maintains a steady presence in the market, primarily focused on securing classified information and protecting critical national infrastructure. These segments each bring unique requirements and challenges to the network encryption landscape, from securing telecommunications networks to protecting sensitive government communications. The diversity of these segments contributes to the overall robustness of the market, with each sector driving innovation in encryption technologies based on their specific security needs and compliance requirements.
Network Encryption Market Geography Segment Analysis
Network Encryption Market in North America
North America continues to dominate the global network encryption market, holding approximately 32% of the market share in 2024. The region's leadership position is primarily driven by the strong presence of major cybersecurity solution providers and advanced technological infrastructure. The United States, in particular, serves as a key contributor to regional growth, with its robust defense and government sectors heavily investing in network encryption solutions. The region's market dynamics are shaped by stringent regulatory frameworks and compliance requirements across various industries, particularly in financial services and healthcare. Organizations across North America are increasingly adopting cloud-based data encryption solutions and implementing advanced security protocols to protect sensitive data. The presence of leading technology hubs and research institutions further strengthens the region's position in driving innovation in network encryption technologies. Additionally, the growing emphasis on data privacy and protection among enterprises has led to increased adoption of end-to-end encryption solutions across various business applications.

Network Encryption Market in Europe
The European network encryption market has demonstrated robust growth, recording approximately a 9% growth rate from 2019 to 2024. The region's market is characterized by strict data protection regulations, particularly the General Data Protection Regulation (GDPR), which has been a significant driver for encryption adoption. European organizations are increasingly focusing on strengthening their cybersecurity infrastructure, with particular emphasis on protecting critical national infrastructure and sensitive business communications. The region has witnessed substantial investments in research and development of advanced network encryption technologies, particularly in countries like Germany, France, and the United Kingdom. The growing adoption of cloud services and digital transformation initiatives across various industries has further accelerated the demand for network encryption solutions. European enterprises are particularly focused on implementing comprehensive encryption strategies that cover both data in transit and at rest. The presence of established cybersecurity vendors and innovative startups has created a competitive landscape that fosters continuous innovation in encryption technologies.
Network Encryption Market in Asia-Pacific
The Asia-Pacific network encryption market is positioned for exceptional growth, with a projected growth rate of approximately 10% from 2024 to 2029. This region represents one of the most dynamic markets for network encryption solutions, driven by rapid digital transformation across various sectors. The market is experiencing significant momentum due to increasing investments in 5G infrastructure, smart city initiatives, and expanding data center capacities across countries like China, India, and Singapore. Rising awareness about cybersecurity threats and the need for robust data encryption protection measures has led to increased adoption of encryption solutions across both public and private sectors. The region's growing financial technology sector and expanding e-commerce landscape have created substantial demand for secure transaction capabilities. Government initiatives promoting digital transformation and cybersecurity awareness have further catalyzed market growth. The presence of emerging technology hubs and increasing foreign investments in the IT sector continue to drive innovation in encryption technologies.
Network Encryption Market in Latin America
The Latin American network encryption market is experiencing significant transformation driven by increasing digitalization across various sectors. The region's market is characterized by growing awareness of cybersecurity threats and the need for robust data protection measures. Countries like Brazil and Mexico are leading the adoption of network encryption solutions, particularly in the banking and telecommunications sectors. The region has witnessed increased investment in digital infrastructure and cybersecurity measures, particularly as organizations accelerate their digital transformation initiatives. Growing concerns about data privacy and security have prompted both government agencies and private enterprises to strengthen their network security protocols. The market is also benefiting from the expansion of cloud services and the increasing adoption of IoT technologies across various industries. Regional organizations are increasingly recognizing the importance of implementing comprehensive encryption strategies to protect sensitive data and maintain a competitive advantage.
Network Encryption Market in Middle East and Africa
The Middle East and Africa network encryption market is emerging as a significant growth opportunity, driven by rapid digital transformation initiatives across the region. Countries in the Gulf Cooperation Council (GCC) are leading the adoption of network encryption solutions, particularly in government, banking, and telecommunications sectors. The region's market is characterized by increasing investments in cybersecurity infrastructure and growing awareness about data protection requirements. Organizations across the region are implementing advanced encryption solutions to protect their digital assets and comply with evolving regulatory requirements. The growing adoption of cloud services and digital payment solutions has created additional demand for robust encryption technologies. Government initiatives promoting digital transformation and smart city development have further accelerated the need for secure communication networks. The market is also benefiting from increasing investments in financial technology and e-commerce platforms, which require robust security measures to protect sensitive transactions.
Network Encryption Industry Overview
Top Companies in Network Encryption Market
The network encryption market features several prominent players, including Thales Group, Juniper Networks, Senetas Corporation, Atos SE, Raytheon Technologies, and Viasat Inc. These companies are driving innovation through advanced encryption technologies like quantum-resistant solutions and high-speed encryption technologies, such as network encryptor devices supporting speeds up to 100 Gbps. Operational agility is demonstrated through the development of flexible deployment options spanning cloud, on-premise, and hybrid environments. Strategic moves include partnerships with universities and research institutions to advance encryption capabilities, while collaborations with telecom providers and system integrators strengthen market presence. Geographic expansion is pursued through strategic acquisitions and the establishment of regional security operations centers, particularly in emerging markets. Companies are also investing in R&D to develop encryption solutions specifically designed for emerging technologies like 5G networks, IoT devices, and edge computing applications.
Consolidated Market Led By Global Players
The network encryption industry exhibits a relatively consolidated structure dominated by large global technology conglomerates with diverse cybersecurity portfolios. These established players leverage their extensive R&D capabilities, global distribution networks, and strong relationships with government and enterprise customers to maintain market leadership. Regional specialists focus on niche applications and specific industry verticals, particularly in highly regulated sectors like defense and financial services. The market has witnessed significant consolidation through strategic acquisitions, with larger players acquiring specialized encryption technology providers to enhance their product portfolios and expand their geographic footprint.
Market dynamics are characterized by high barriers to entry due to stringent regulatory requirements, complex technological needs, and the necessity for significant R&D investments. Major players are increasingly pursuing vertical integration strategies, developing comprehensive security solutions that combine hardware encryption devices with software platforms and managed services. The competitive landscape is further shaped by strategic partnerships between technology providers and system integrators, enabling comprehensive solution delivery and enhanced market reach.
Innovation and Adaptability Drive Market Success
Success in the network encryption market increasingly depends on vendors' ability to deliver scalable, flexible solutions that address evolving security threats and changing customer requirements. Incumbent players must focus on continuous innovation in encryption technologies, particularly in areas like quantum computing resistance and high-speed encryption for data center applications. Market leaders are strengthening their positions through increased investment in cloud-based encryption services, development of automation capabilities, and enhancement of their professional services offerings. The ability to provide seamless integration with existing network infrastructure and support for multiple protocols and standards has become crucial for maintaining market share.
For emerging players and contenders, success lies in identifying and addressing underserved market segments and developing specialized solutions for specific industry verticals or use cases. Companies must navigate complex regulatory environments across different regions while ensuring compliance with evolving data protection standards. The increasing adoption of cloud services and digital transformation initiatives presents opportunities for new entrants to gain ground through innovative encryption data solutions. Future success will depend on the ability to balance security requirements with performance demands, while maintaining competitive pricing and providing comprehensive support services. Vendors must also consider the growing influence of managed security service providers and adapt their go-to-market strategies accordingly.
Network Encryption Market Leaders
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Thales Trusted Cyber Technologies
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ATMedia Gmbh
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Atos SE
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Juniper Networks Inc.
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Certes Networks Inc.
- *Disclaimer: Major Players sorted in no particular order

Network Encryption Market News
- October 2023 - Nokia announced that it has been selected with partner DPR by K2 Telecom Brazil to offer solutions that would assist the ISP to strengthen its network security and create new revenue streams. Nokia would deploy its identical and innovative BNG/CGNAT solution, enabling K2 Telecom to offer all IP infrastructure and ISP requirements as-a-service and providing cloud-based DDoS defense as-a-service
- February 2023 - Sitehop, a Sheffield-based company that has developed a new encryption solution for telecoms and data networks, raised over EUR 1 million (USD 1.13 million) from NPIF - Mercia Equity Finance, Mercia's EIS funds, and private investors. The company is in talks with several international network providers and is set to begin a trial in Brazil before launching the system in spring. The funding will enable it to invest in equipment to support the prosecution and expand its six-strong team.
Network Encryption Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions and Market Definition
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
- 4.1 Market Overview
-
4.2 Industry Attractiveness - Porter's Five Forces Analysis
- 4.2.1 Bargaining Power of Suppliers
- 4.2.2 Bargaining Power of Buyers
- 4.2.3 Threat of New Entrants
- 4.2.4 Threat of Substitute Products
- 4.2.5 Intensity of Competitive Rivalry
- 4.3 Assessment of the Impact of COVID-19 on the Market
5. MARKET DYNAMICS
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5.1 Market Drivers
- 5.1.1 Increasing Number of Network Security Breaches
- 5.1.2 Increasing Adoption of Cloud Technologies by Numerous Organizations
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5.2 Market Challenges
- 5.2.1 High Implementation Cost of Network Encryption Solutions
6. MARKET SEGMENTATION
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6.1 By Deployment Type
- 6.1.1 Cloud
- 6.1.2 On-premise
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6.2 By Component
- 6.2.1 Hardware
- 6.2.2 Solutions & Services
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6.3 By Organization Size
- 6.3.1 Small and Medium-sized Enterprises
- 6.3.2 Large-sized Enterprises
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6.4 By End-user Industry
- 6.4.1 Telecom & IT
- 6.4.2 BFSI
- 6.4.3 Government
- 6.4.4 Media & Entertainment
- 6.4.5 Other End-user Industries
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6.5 By Geography
- 6.5.1 North America
- 6.5.2 Europe
- 6.5.3 Asia Pacific
- 6.5.4 Latin America
- 6.5.5 Middle East and Africa
7. COMPETITIVE LANDSCAPE
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7.1 Company Profiles
- 7.1.1 Thales Trusted Cyber Technologies
- 7.1.2 ATMedia Gmbh
- 7.1.3 Atos SE
- 7.1.4 Juniper Networks Inc.
- 7.1.5 Certes Networks Inc.
- 7.1.6 Senetas Corporation Ltd.
- 7.1.7 Viasat Inc.
- 7.1.8 Raytheon Technologies Corporation
- 7.1.9 Securosys SA
- 7.1.10 Packetlight Networks
- 7.1.11 Rohde & Schwarz Cybersecurity GmbH
- 7.1.12 Colt Technology Services Group Ltd.
- 7.1.13 Ciena Corporation
- *List Not Exhaustive
8. INVESTMENT ANALYSIS
9. FUTURE OF THE MARKET
Network Encryption Industry Segmentation
Network encryption is encoding sensitive data such as passwords, credentials, and files, among others, which are transmitted or communicated through a computer network. The study also tracks key market parameters, underlying growth influencers, and major vendors operating in the industry, which is expected to support market estimations and growth rates over the forecast period.
The network encryption market is segmented by deployment type (cloud, on-premise), by component (hardware, solutions, and services), by organization size (small and medium-sized enterprises, large-sized enterprises), by end-user industry (telecom & IT, BFSI, government, media & entertainment), by geography (North America, Europe, Asia Pacific, Latin America, Middle East, and Africa). The market sizes and forecasts are provided in terms of value in USD for all the above segments.
By Deployment Type | Cloud |
On-premise | |
By Component | Hardware |
Solutions & Services | |
By Organization Size | Small and Medium-sized Enterprises |
Large-sized Enterprises | |
By End-user Industry | Telecom & IT |
BFSI | |
Government | |
Media & Entertainment | |
Other End-user Industries | |
By Geography | North America |
Europe | |
Asia Pacific | |
Latin America | |
Middle East and Africa |
Network Encryption Market Research FAQs
How big is the Network Encryption Market?
The Network Encryption Market size is expected to reach USD 5.24 billion in 2025 and grow at a CAGR of greater than 8.43% to reach USD 7.85 billion by 2030.
What is the current Network Encryption Market size?
In 2025, the Network Encryption Market size is expected to reach USD 5.24 billion.
Who are the key players in Network Encryption Market?
Thales Trusted Cyber Technologies, ATMedia Gmbh, Atos SE, Juniper Networks Inc. and Certes Networks Inc. are the major companies operating in the Network Encryption Market.
Which is the fastest growing region in Network Encryption Market?
Asia Pacific is estimated to grow at the highest CAGR over the forecast period (2025-2030).
Which region has the biggest share in Network Encryption Market?
In 2025, the North America accounts for the largest market share in Network Encryption Market.
What years does this Network Encryption Market cover, and what was the market size in 2024?
In 2024, the Network Encryption Market size was estimated at USD 4.80 billion. The report covers the Network Encryption Market historical market size for years: 2019, 2020, 2021, 2022, 2023 and 2024. The report also forecasts the Network Encryption Market size for years: 2025, 2026, 2027, 2028, 2029 and 2030.
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Network Encryption Market Research
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