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Security Appliance Market Sees Strong Q1 2012, Says IDC

According to newly released data from International Data Corporation (IDC), security appliance vendors enjoyed strong continued growth during the first quarter of this year, as evidenced by recent numbers coming from the technology market research firm.

According to IDC’s Worldwide Quarterly Security Appliance Tracker, factory revenue and unit shipments both grew in the first quarter of 2012, marking the eighth consecutive quarter of year-over-year growth. The research firm said worldwide factory revenue was up 9.7% year over year to $1.9 billion, and shipments increased 12.9% to 511,220 units.

Globally, all regions of the world, with the exception of Asia/Pacific (excluding Japan) saw double-digit growth in unit shipments. Shipments grew fastest in Central & Eastern Europe with a notable 39.3% year-over-year increase.

The United States saw the biggest year-over-year gains in factory revenue (16.2%), something IDC says is due to increased high-end firewall and IPS shipments.

"The increasingly complex nature of IT security along with the growing threat landscape has the potential to affect operations and cause significant disruptions and the loss of sensitive data," said Ebenezer Obeng-Nyarkoh, senior research analyst, Worldwide Trackers Group. "Security products are expanding rapidly into other small, fast-growing geographies where demand is greater than ever."

The combined market share of the top 5 global security appliance vendors increased to 50.7% during Q1 2012. Cisco held the top spot in overall security appliance market with 18.4% share in factory revenue for the first quarter, followed by Check Point with 12.7% share. Juniper was the only vendor in the top 5 that saw share loss (0.7 points year over year) and saw a modest 0.8% year-over-year increase in revenue, according to IDC’s numbers. McAfee and Fortinet gained about half a percent of market share compared to the prior year's period, as both saw strong double-digit growth.

Security Appliance Vendors

The Firewall/VPN segment saw the largest year-over-year revenue growth at 23.3% and accounted for 28.3% of the overall security appliance market during the quarter. “This was due in large part to Cisco's growth and a strong quarter for Juniper's high end SRX, despite weakness elsewhere in the portfolio,” IDC explained.

The Unified Threat Management (UTM) market represented 28.5% of the overall security appliance revenues, with 12.2% year-over-year growth. Content management saw more modest year-over-year revenue growth of 5.3% as its share of the overall appliance market fell to 17.7%.

Standalone VPN solutions were the only area that post a decline versus the prior year (–10.2%) and accounted for 7.9% of the market. "Increasingly, customers are requiring products that protect against a variety of threats, lower the total cost of ownership, and offer more streamlined management," said John Grady, senior research analyst, Security Products at IDC. "The UTM market, which includes most application-aware, next-generation firewalls fulfills these requirements. As such, IDC expects to see continued strong growth in this market segment."

A separate report published last week by MarketsandMarkets showed that the global cyber security market is expected to grow from $63.7 billion in 2011 to $120.1 billion by 2017, at an estimated CAGR of 11.3% from 2012 to 2017.

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