Market Trends of Managed Security Services Industry
BFSI Sector to be the Fastest-growing End-user Industry
- Managed security services are set to dominate the BFSI sector, primarily due to their role in safeguarding sensitive data and bolstering overall security. A key advantage of these services in the BFSI space is their round-the-clock monitoring, enabling swift incident response and remediation in case of breaches.
- Given the BFSI sector's focus on safeguarding client data, there has been a notable surge in the adoption of managed security services. This move is aimed at bolstering the security of online services against the rising tide of cyberattacks.
- In today's digital landscape, BFSI firms must employ advanced real-time security measures. These include endpoint detection and response (EDR), biometric technology, cloud security, code audit, embedded system security assessment, integrated security solutions, cyber intelligence, multi-factor authentication, security training, and behavioral analytics, among others.
- While financial institutions worldwide are enhancing their cyber threat prevention strategies, BFSI entities in India are grappling with the significance and repercussions of cybersecurity. Common cyberattacks like security breaches, data thefts, and password compromises pose significant concerns for these firms. The evolving cybercrime landscape, with its new techniques and skilled perpetrators, underscores the limitations of current cybersecurity approaches in India's BFSI realm.
- The BFSI sector is witnessing a surge in distributed denial of service (DDoS) attacks, amplifying the significance of managed security services, particularly in the realm of DDoS mitigation. Notably, in September 2023, Akamai, a leading cybersecurity provider, successfully thwarted a major DDoS attack on a US financial institution. This incident underscores the escalating threat landscape for BFSIs, creating a ripe market for managed security services to fortify against DDoS assaults.
- As malware types evolve, the need for detection solutions intensifies. According to Zimperium, in 2023, the banking malware Godfather had 1,171 known variants. As of 2023, Nexus malware ranked first, with approximately 500 variants, while Saderat had around 300 types. Overall, the top five malware families had over 50 variants.
- The mounting frequency of cyberattacks in the BFSI sector is driving up the demand for managed security services. These services play a pivotal role in safeguarding financial systems, customer data, and the overall trust of stakeholders in an increasingly interconnected and digitized financial ecosystem. This heightened demand is poised to propel the market growth in the coming years.
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North America is Expected to Hold Significant Market Share
- The North American region has been witnessing a significant integration of modern technology, and the need for streamlined IT functions is growing rapidly, with an increasing number of businesses in the region finding it easy to keep pace with that with the help of managed security service providers, which is driving the business growth in the future.
- The penetration of smartphones and tablets is increasing in the United States, which will likely drive the bring your own device (BYOD) policy. The increasing penetration of devices and strong network connectivity across the region are expected to encourage organizations to adopt BYOD policies, raising the risk of cyberattacks in the business ecosystems and supporting the demand for managed security services in the region in the future.
- Furthermore, the penetration of these smart devices is expected to increase due to the rapid integration of IoT across various industries and sectors. This is expected to propel the adoption and incorporation of managed security services, thereby fueling the market’s growth.
- The use of multi-cloud environments is experiencing massive growth in the United States, wherein clients rely majorly on one cloud while using the other sporadically. Here, managed security service providers (MSSPs) can avail of the opportunity by offering consumption-based pricing models.
- Moreover, in the United States, public cloud and managed services are expected to be leveraged more often for IT operations management (ITOM) tools, encouraging the growth of the subscription business design for both cloud and on-premises ITOM. Despite this, on-premises deployments are expected to be the most popular delivery method.
- The region also faces a significant number of DDoS attacks, which are likely to increase with respect to multiple end-user industries, further driving the demand for DDoS protection solutions. Moreover, cyberattacks in the region, especially in the United States, are increasing rapidly. They are reaching high numbers, primarily due to the rapidly increasing number of connected devices in the region.
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