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Hardware Security Modules (HSM) Market Size, Share, Development, Growth and Demand Forecast to 2024 - Industry Insights by Type (LAN Based, PCle Based, USB Based), by Application (Payment Processing, Authentication, Code and Document Signing, PKI, Application Level and Database Encryption, SSL) by Industry (BFSI, Government, ICT, Manufacturing, and Others)

  • Publishing: May 2021
  • Report Code: SE10926
  • Available Format: PDF

Market Overview

Hardware security module (HSM) is a management solution that provides protection against the evolving data threats to private (digital) keys and certificates. The device requires certification to internationally recognized standards such as federal information processing standards (FIPS) 140, common criteria that provides the product design and implementation assurance. The global hardware security modules market is expected to witness potentially huge growth opportunities in the coming years, on account of surge in technological advancements, which created an essential demand for information systems security solutions, worldwide.

The hardware security modules help organizations to achieve required compliance with stringent data privacy regulations and guard sensitive corporate assets, customer’s personal information, and digital transactions against exposure and manipulation. It finds application in a number of industries including banking and financial services, government, technology and communications, manufacturing, utility and energy, retail, and healthcare and life sciences. The applications of hardware security module include public key infrastructures, identity management systems, databases, encryption and tokenization, code signing and time stamping.

Market Dynamics

Latin America is expected to register the highest growth in the market, during the forecast period, on the back of huge investments in communication network infrastructure in the region, which is expected to shoot up the demand for hardware security modules for information security. High anticipated growth in Asia-Pacific HSM market can be attributed to growing emphasis on digitization of transaction systems. The demand for USB-based or portable plugin HSMs is also expected to grow during the forecast period due to its varied benefits such as lower cost as compared to LAN-based HSMs and embedded plugin HSMs, compact size and portability feature. With an inclusion of huge number of Internet of Things (IoT) devices that is expected by 2020, there arises a need to secure the components of IoT ecosystem. The components of IoT ecosystem include the hardware and the software, which will be required to be safeguarded with the help of information security solutions. This is in turn acts as a major influencing factor propelling the growth of HSM market during the forecast period.

Trends

With the increasing penetration of internet, adapting to information systems to ease various operational processes has become essential for organizations as well as individuals. The demand for USB-based or portable HSMs has been increasing owing to their suitability in offline situations, where the hardware security module can be stored in a safe place while not in use, or if the HSM needs to be portable. The features of USB-based hardware security modules, such as portability and USB connectivity, ensure its suitability with laptops, desktops, or workstations, in turn making USB-based HSM the fastest growing market among the various types. The emergence of electronic payments, digital transactions and the growing need to protect highly sensitive financial data from potential security threats has resulted in the largest share of payment processing application in the hardware security modules market.

Growth Drivers

Hardware security modules are essentially required by organizations to protect customers trust in an increasingly digitized world, while ensuring full-proof protection against cybertheft and other forms of data thefts. Statistics have shown that a huge number of intrusions in information systems have been causing significant financial losses to companies, and hence restoring the system operation needs further investments and has time restraints. A potential demand for information security solutions provided by hardware security modules exists in a bid to overcome such challenges for organisations that employ high valued information systems. Some of the most security-conscious institutions globally have been using these hardware security modules to securely manage, process and store their cryptographic keys.

The widespread technological transition that led to an increase in adoption of modern innovative technology concepts of IoT and cloud computing, further drives the growth for hardware security modules market, owing to a surge in demand for information and data security. Major demand for hardware security modules emanates from banking and financial institutions that run payment processing on secured platforms such as Mastercard and Visa. The increase in adoption of digital payment methods is giving a major boost to the HSM market. Moreover, the worldwide prominence of bit coins also drives the industries towards adoption of digital transaction processes, and this in turn increases the demand for data and information security solutions provided by HSM. Also, the integration of blockchain transaction security systems with hardware security modules in order to provide the customers a user- friendly interface has further led to growth in the hardware security modules market.

Competitive Analysis

The key players in the hardware security module market include Gemalto NV, Thales e-Security Inc., Utimaco GmbH, International Business Machines Corporation, FutureX, Spyrus Inc., Hewlett-Packard Enterprise Development LP, SWIFT, Atos SE, Ultra-Electronics, and Yubico.

The competitors have been introducing competitive security solutions in the market, in a bid to increase their market share. The players often collaborate with software solution providers to provide better security solutions to customers for the intended application. For instance, Thales in partnership with Chain has recently announced an integration to boost the security solutions using Chain’s blockchain infrastructure. Thales is one of the major HSM market players, while Chain offers blockchain solutions.

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