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Security Appliance Market Growth Slows in First Quarter, According to IDC

  Security Appliance Market Growth Slows in First Quarter, According to IDC

Business Wire

FRAMINGHAM, Mass. -- June 24, 2013

According to the International Data Corporation (IDC) Worldwide Quarterly
Security Appliance Tracker, factory revenue rose in the first quarter of 2013
(1Q13) compared to Q1 2012, while unit shipments declined over the same
period. Worldwide factory revenue was up 3.4% year over year to $2.0 billion,
as shipments decreased -6.8% to 472,306 units. The shipment decline was due in
large part to Cisco, which has transitioned to new appliances with a higher
price point causing revenue to remain more consistent compared to declining
units. The year-over-year growth rate for factory revenue was the lowest since
Q1 2010.

Geographically, Canada saw the highest year-over-year growth in the quarter
(16.4%), followed by Japan (8.6%). Asia/Pacific (excluding Japan) continued to
see steady growth (7.1%) and accounted for more than 16% of worldwide factory
revenue. Western Europe also built on a strong fourth quarter and saw factory
revenue rise 3.9% versus 1Q12. Asia/Pacific (excluding Japan) was the only
region to see a year-over-year increase in unit shipments in the quarter
(2.8%). The United States recorded a -0.2% decline in factory revenue and a
unit decrease of -10.2% compared to 1Q12.

"The government sector seemed to impact the results somewhat in the United
States," said John Grady, Research Manager, Security Products at IDC "However,
all organizations continue to prioritize security within their overall IT
budget. With advanced, targeted threats a growing concern, IDC expects
continued high single-digit growth in the overall security appliance segment
over the course of 2013.”

Cisco continues to lead the overall security appliance market with a 16.6%
share in factory revenue for the first quarter, but this was down from 17.8%
in the prior year period. Check Point held the number 2 spot with a 12.5%
share for the quarter as revenue increased 5.7% compared to the first quarter
of 2012. Fortinet saw the largest revenue growth among the top five vendors at
16.6%. The combined shares of the top 5 global vendors represented 49% of the
market in Q1 2013. Blue Coat, Palo Alto Networks, and Sophos were some of the
vendors outside the top 5 seeing strong growth in the quarter.

                                                                 
Top 5 Vendors, Worldwide Security Appliance Revenue, First Quarter of 2013

(revenues in $ millions)
                                                                                  
Vendor     1Q13          1Q13 Share   1Q12          1Q12 Share   1Q13/1Q12
             Revenue                      Revenue                      Growth
Cisco      $335       16.6%     $346       17.8%     -3.4%    
Check      $252       12.5%     $255       12.3%     5.7%     
Point
Juniper    $125       6.2%      $152       7.8%      -17.7%   
Fortinet   $121       6.0%      $104       5.3%      16.6%    
McAfee     $111       5.5%      $112       5.8%      -0.8%    
Others     $1,066     53.2%     $976       51.0%     7.5%     
Total      $2,010     100%      $1,945     100%      3.4%     
                                                                                  
Source: IDC Worldwide Quarterly Security Appliance Tracker, June 20, 2013


Functional Market Results

At the functional market level, the Unified Threat Management (UTM) segment
saw the largest year-over-year revenue growth at 36.4% and accounted for 37.1%
of security appliance revenue in 1Q13, as multi-function appliances continued
to drive growth in the overall market. The Firewall/VPN market declined 21.2%
year over year, but still represented 20.9% of security appliance revenue in
the quarter. The Content Security segment rose by 6.8% compared to the prior
year and accounted for 20.3% of the market. IDP saw modest growth of 0.3%
compared to the prior year period.

"While businesses continue to explore the opportunities for migrating to a
private cloud network as a new technology paradigm, unified security prospects
will continue to expand rapidly into other small and medium-size businesses
where demand is greater than ever," said Ebenezer Obeng-Nyarkoh, Senior
Research Analyst, Worldwide Trackers Group.

IDC's Worldwide Quarterly Security Appliance Tracker is a quantitative tool
for analyzing the global security market on a quarterly basis and is available
on demand. The Tracker includes quarterly shipments and revenues (both
customer and factory), segmented by vendor, family, model, region, operating
system, price band, and security functions.

About IDC

International Data Corporation (IDC) is the premier global provider of market
intelligence, advisory services, and events for the information technology,
telecommunications, and consumer technology markets. IDC helps IT
professionals, business executives, and the investment community to make
fact-based decisions on technology purchases and business strategy. More than
1,000 IDC analysts provide global, regional, and local expertise on technology
and industry opportunities and trends in over 110 countries. For more than 49
years, IDC has provided strategic insights to help our clients achieve their
key business objectives. IDC is a subsidiary of IDG, the world's leading
technology media, research, and events company. You can learn more about IDC
by visiting www.idc.com.

All product and company names may be trademarks or registered trademarks of
their respective holders.

Contact:

IDC
John Grady, 508-988-6743
jgrady@idc.com
or
Eb Obeng-Nyarkoh, 508-935-4356
eobeng-nyarkoh@idc.com
or
Michael Shirer, 508-935-4200
press@idc.com
 
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