Market Outlook
The next-generation firewall (NGFW) market size stood at $2,706.9 million in 2019, and it is expected to reach $5,188.8 million by 2025, witnessing a CAGR of 11.9% during 2020–2025.
Globally, the Asia-Pacific (APAC) region will exhibit the fastest growth till 2025 due to the surging number of cyberattacks, rising adoption of internet of things (IoT) devices, and soaring number of small- and medium-sized enterprises (SMEs).
Trends & Drivers
The increasing adoption of the IoT technology is a prominent trend in the next-generation firewall industry. In contemporary times, enterprises are using it to obtain the advantages of several enhanced business models, such as pay-per-use, asset sharing, and outcome-based models, and gain real-time operational insights into security issue identification and equipment monitoring. The deployment of IoT devices improves business productivity; however, they are highly vulnerable to cyberattacks due to internet connectivity.
To overcome these security threats, business organizations are incorporating NGFW solutions, which are network-friendly and offer defensive competencies against internet-based security threats and several applications and protocols, such as internet protocol, transfer protocol, and secure shell. Thus, the escalating concerns of enterprises related to network and device security are resulting in the adoption of NGFW solutions.
The limitations of traditional firewalls have become a key catalyst for the next-generation firewall market growth. Traditional firewalls cannot meet the changing internet security demand of enterprises, as it is followed by web protocols and is not efficient in distinguishing among several types of web traffic, such as legitimate business applications, and inspect the network packet data. It turns out to be a non-feasible solution as it either accepts or rejects the overall data traffic.
The increasing requirement for enhanced cybersecurity among businesses can be owed to the wide deployment of virtual machines and applications. All these limitations and challenges are eliminated by NGFW solutions because they add various protection layers, including application-level inspection and intrusion protection, and make traditional firewalls more efficient with the usage of protocol protection.
The surging number of web applications also plays a vital role in the market growth. Presently, industries such as retail, healthcare, aerospace and defense, and banking, financial services, and insurance (BFSI) are opting for cloud platforms for data storage, which demand strong protection from cyberattacks. Owing to these threats, these end-users are adopting NGFW solutions as they provide eight layers of security, including a data link layer, network layer, application layer, and transport layer, which block the threats through web-specific detection engines and web protocols.
Segmentation Analysis
The services category, within the component segment of the next-generation firewall market, will display the faster growth in the coming years. This will be due to the surging adoption of IoT devices, which creates a high demand for professional services.
The large enterprises category, under the enterprise size segment, will generate the higher revenue in the market for next-generation firewall in 2019. This will be due to the growing requirement for better digital security in large organizations for securing and managing large volumes of data.
The BFSI category is expected to hold the largest share in 2019, on the basis of industry, due to the soaring adoption of digital technologies, spurring demand for the safety of consumer data, and mounting cyber threats.
Geographical Analysis
North America would emerge as the market leader in 2019 due to the presence of a large number of industry players, such as Dell Technologies Inc., Cisco Systems Inc., and Palo Alto Networks Inc., widescale deployment of cloud computing solutions, and implementation of numerous government initiatives for public data safety in the region. For instance, the President Budget of 2019 in the U.S. allotted $15 billion to mitigate cyber threats.
The APAC region is expected to demonstrate the fastest growth in the next-generation firewall market during 2020–2025. This can be ascribed to the escalating number of SMEs, booming cyber threats, and rising focus of governments on data security. For instance, in 2018, the Personal Data Protection Commission of Singapore fined Club the Chambers, a network gaming center; and Grabcar, a carpooling firm, $5,000 and $4,200, respectively, for two different cases of data breaches, as both these companies had failed to make adequate arrangements for the protection of the personal data of people.
Competitive Landscape
The global next-generation firewall market is fragmented and highly competitive, with Cisco Systems Inc., Palo Alto Networks Inc., Dell Technologies Inc., Juniper Networks Inc., Fortinet Inc., Check Point Software Technologies Ltd., Huawei Technologies Co. Ltd., and Barracuda Networks Inc. being the key companies. These players focus on product innovations, partnerships, and mergers and acquisitions to stay ahead in the competition.
For instance, in December 2018, Fortinet Inc. partnered with Symantec Ltd.; as part of the agreement, the NGFW capabilities of Fortinet were integrated with the cloud-delivered web services of Symantec, to provide enhanced cloud security solutions to customers.
Key Questions Addressed/Answered in the Report
- What is the current scenario of the global next-generation firewall market?
- What are the emerging technologies for the development of NGFW solutions?
- What are the historical size and the present size of the categories within the market segments and their future potential?
- What are the major catalysts for the market and their expected impact during the short, medium, and long terms?
- What are the evolving opportunities for the market players?
- Which are the key regions for the market players from the investment perspective?
- What are the key strategies being adopted by the major players to expand their market share?
