◆英語タイトル：Network Encryption Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)
・競争状況（Thales Trusted Cyber Technologies、ATMedia Gmbh、Atos SE、Juniper Networks Inc.、Certes Networks Inc.、Senetas Corporation Ltd、Viasat Inc.、Raytheon Technologies Corporation、Securosys SA、Packetlight Networks、Rohde & Schwarz Cybersecurity GmbH、Colt Technology Services Group Ltd、Ciena Corporation）
The Global Network Encryption Market was valued at USD 3.48 Billion in 2020, and it is projected to be worth USD 5.91 Billion by 2026, registering a CAGR of 9.12% during the forecast period of 2021-2026. The COVID-19 pandemic has resulted in a number of workers being displaced, causing a transition in the overall network utilization. Increased data transfers from emails, video conferencing, make-shift work environments, and remote applications have resulted in critical infrastructure being overloaded.
- Unfortunately, the peak pandemic period observed an overwhelming increase in the number of cyber-attacks. However, the pandemic has resulted in an unseen impact, which ignited a revolution in remote working on a massive scale. Remote operations often utilize unprotected public networks, thus, making productivity application tools vulnerable to attacks. This has led to an increasing need to improve network security.
- Network encryption can be referred to as a process of encoding sensitive data such as passwords, credentials, and files, among others, which are transmitted or communicated through a computer network. Network encryption comprises three major components, namely, hardware, services, and platform.
- The increasing number of network security breaches, increasing adoption of cloud technologies by numerous organizations, and the rising need to comply with ever-changing regulatory standards for improved data protection are some of the significant factors influencing the growth of the market.
- A Cybersecurity Breaches Survey conducted and published in the Department for Digital, Culture, Media, and Sport (DCMS) report indicated that about 45% of businesses and 65% of charities have implemented a ‘Bring Your Own Device (BYOD)’ system wherein the staff uses their own private devices, such as laptops, for work purposes. While these devices add flexibility at work, they also add to the need for network encryption enhancement, thus, resulting in increased demand for the market studied.
- Besides, regulatory standards set up by countries across the world have been a crucial factor in driving the market’s growth. For instance, the EU Networks and Information Security Directive set in place by the United Kingdom has placed legal obligations on operators of UK critical services to improve their security measures. Besides, market players are looking to strengthen their competitiveness through various growth strategies, such as investments into new product offerings, new production facilities, innovation of products, increased R&D, and an exploration of overseas markets.
- Further, in February 2021, Viasat Inc., a prominent communications company, announced the launch of the Viasat KG-142, a high-speed network encryptor. The company stated that the device is the first to be certified as meeting the Ethernet Data Encryptor Cryptographic Interoperability Specification (EDE-CIS) in a new, critical National Security Agency (NSA) standard.
- Furthermore, with cyber-attacks on both personal & public computer systems increasing in frequency, protecting data has never been more important. Attack types have diversified, and ransomware attacks, in which sensitive data is held hostage or even exposed to public viewing, have become an area of particular concern for today’s web users.
Key Market Trends
Telecom & IT Sector is Expected to Hold a Significant Share of the Market
- The growing cloud adoption, increasing investment in optical communication, an increasing number of network data breaches, and stringent government regulations are some of the major factors driving the adoption of network encryption in the global IT and Telecom industry. Furthermore, the growing adoption of a private network, trends of network automation, and the advent of 5G networks will create massive growth opportunities for the studied market vendors in the IT and Telecom sector.
- The IT and telecom industry networks are becoming prone to cyberattacks. According to SpyCloud, the IT and Telecom industry is becoming the most vulnerable to network attacks in recent years, owing to the high adoption of cloud and IoT services. The company also reported that 11 telecom companies in the Fortune 1000 comprise the most vulnerable industry in the study done in 2020.
- Studied market vendors are also offering products to secure Data Center Interconnect (DCI) applications. Network encryption combines ease of operation and administration for IT and telecom vendors to enable simple-to-implement data protection strategies. For instance, Rohde & Schwarz relies on the R&S Trusted VPN IPsec-based encryption solution for secure voice and data communications at 78 locations in 40 countries.
- Furthermore, the growing trend of BYOD in the IT companies and increasing adoption of the enterprise storage network is also expanding the scope of private networks among the global IT companies. In addition to that, telecom operators are transforming themselves from network companies to cloud service companies to roll out new services and applications and store and distribute content through various networks. According to the GDPR Report, network-attached storage devices are among the topmost vulnerable devices in the IT industry.
- According to GSMA, 56% of Mobile Network Operators globally have little or no automation in their network. By 2025, 80% of MNOs (mobile network operators) expect to have automated 40% of their network operations. From a foundational perspective, this is not an incremental step in a world moving to 5G. The new standalone architecture (SA) and distributed vRAN (Virtual Radio Access Network) that 5G will bring is defined as a cloud-native.
- In February 2020, Huawei launched a deterministic networking-oriented 5G network solution based on the key concept of “Cloud Native, One Core, Real-time Operation, and Edge Computing. Recently, Extreme Networks launched new hardware and software in its’ Agile Data Center solution, enabling organizations to embrace data center networking and automation.
North America is Expected to Account for the Largest Market Share
- The North American region is one of the largest regions for network encryption. The presence of the United States, one of the major countries in cybersecurity solutions, contributes to the highest market share of North America.
- Moreover, in the United States, end-to-end encryption has been a key sticking point between large tech companies and law enforcement. To counter this, three Republican senators in June 2020 introduced a bill that would force tech companies to offer a backdoor to end-to-end encrypted communication. The bill targeted companies that were refusing to cooperate with law enforcement to help recover encrypted data, even when presented with a lawful warrant, even though companies like Apple have always argued that they are incapable of doing so as they don’t have access to data that uses this form of encryption.
- The Lawful Access to Encrypted Data Act had been recently introduced to the United States. Congress may worsen in a recent string of encryption attacks, its most robust digital security tool online.
- While the recently amended EARN IT Act would leave strong encryption on the unstable ground if passed into law. The Lawful Access to Encrypted Data Act (LAEDA) is a direct assault on the tool millions of people rely on for personal and national security each day.
- In December 2020, FireEye mentioned that while some 18,000 organizations had malicious code in their networks, it was the 50 who suffered major breaches. The United States Treasury and departments of homeland security, state, and defense are known to have been targeted.
- Further, with the increase in the number of network breaches in the region, the encryption demand increased. In December 2020, The United States energy department was the latest agency to confirm it has been breached in what is being described as the worst-ever hack on the United States government. The department is responsible for managing United States nuclear weapons but said the arsenal’s security had not been compromised. Tech giant Microsoft mentioned that it had found malicious software in its systems.
- Further, network hackers are increasingly targeting enterprises and medical institutions to gain the personal data of the victim. Personal data is often used to socially engineer their attacks, which are more likely to trick the victim when compared to traditional cyber attacks. As of 2018, 75% of the total data breaches recorded in the United States were reported in the business and medical sectors.
The Global Network Encryption Market is quite fragmented, with a number of players operating in the space. No single organization has enough influence to move the industry in a single direction. The major players with a prominent share in the market are focusing on expanding their customer base across foreign countries by leveraging strategic collaborative initiatives to increase their market share and their profitability. The Thales Trusted Cyber Technologies, Technical Communications Corporation, Atos SE, Juniper Networks, Inc., Certes Networks, Inc., Senetas Corporation Ltd., Viasat Inc., Raytheon Technologies Corporation, Securosys SA., Packetlight Networks are some of the major players present in the current market.
- February 2021 – Colt developed QKD security capabilities and implemented them on a metro network in Frankfurt. Colt used ADVA’s FSP 3000 for the trial received quantum keys generated by ID Quantique’s QKD technology, which provided quantum random bit strings and transmission of 100Gbps.
- January 2021 – Senetas introduced the first high-assurance quantum-resistant network encryption capability for the protection of sensitive government and business network data against the emerging threat of quantum computing.
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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 Impact of COVID-19 on the Market
5 MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Increasing Number of Network Security Breaches
5.1.2 Increasing Adoption of Cloud Technologies by Numerous Organizations
5.2 Market Challenges
5.2.1 High Implementation Cost of Network Encryption Solutions
6 MARKET SEGMENTATION
6.1 Deployment Type
6.2.2 Solutions & Services
6.3 Organization Size
6.3.1 Small and Medium-sized Enterprises
6.3.2 Large-sized Enterprises
6.4 End-user Industry
6.4.1 Telecom & IT
6.4.4 Media & Entertainment
6.4.5 Other End-user Industries
6.5.1 North America
6.5.3 Asia Pacific
6.5.4 Latin America
6.5.5 Middle East and Africa
7 COMPETITIVE LANDSCAPE
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
8 INVESTMENT ANALYSIS
9 MARKET OPPORTUNITIES AND FUTURE TRENDS
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