August 17, 2009
By Vivek Naik, TMCnet Contributor
According to the latest Infonetics Research report, 82 percent of respondents planned to enhance, not replace, their existing security deployments with a Software-as-a-Service, or “SaaS” solution.
The company’s announced the finding in its market research analysis titled, “Enterprise Acceptance of Software as a Service: End User Survey.” Researcher analysts at the company also said that 81 percent of respondents claimed more companies were moving towards SaaS business models because they found that SaaS has many advantages and the accompanying security safeguards guaranteed comprehensive protection.
The primary reason why customers are turning to SaaS is the significant cost benefits because it gives them the freedom to use and pay for only select components of their choice from software suites, and the flexibility to add other requisites as and when the need arises. Prior to this innovative customer driven request for ‘a use and pay, when required only’ approach, entire solutions had to be bought and installed at a significantly higher one-time cost.
IT support resources such as staff, network equipment, installation fees and annual maintenance contracts are kept to a minimum, if not eliminated. With lesser pre-installed information to wade through, systems become more agile and corrective measures require lesser bandwidth, are more focussed and can be done remotely.
"Many companies who move to SaaS do so because it provides them access to better technology than they could purchase in product form,” said Jeff Wilson, principal analyst for network security, encrypted virtual private network, and continuous research services at Infonetics Research, in a statement. “In addition, going with a service model ensures their technology stays updated. This leads to stronger security deployments overall, and for 81 percent of our security SaaS survey respondents, that's a key driver for moving to SaaS."
The firm said the top three security SaaS vendors from a brand awareness perspective were: McAfee, which established an entire SaaS business unit in late 2008; ScanSafe, the most visible standalone security SaaS vendor; and, Qualys, which has been offering vulnerability testing using a SaaS model for nearly a decade.
Infonetics’ bar chart (shown below) indicates that the top four critical drivers, according to respondents, for rolling out SaaS for security are Strength for security, Cost, Time to deploy, and Centralized management. All four drivers have ratings well above the 60 percent mark.
Another company report titled, ‘Security and Encrypted VPN Services: CPE, Cloud, and SaaS,’ found that the growing interest in SaaS and cloud computing is in turn driving the growth of the IT related security market segment.
Managed security services are projected to drive revenues up by 78 percent in 2013 when compared with 2008, and during this period, will grow at a Compound Annual Growth Rate (CAGR) of 46 percent, which is the highest CAGR in all of the market research company’s security services reports by a significant margin.
The biggest market for managed security services is North America, the Europe Middle East and Africa have recently shown growing trends of adopting this route, and Asia Pacific and Central America and Latin America represent strong future growth potential as a lot of first time interest appears to be brewing in those regions.
Within the managed security potpourri of services offered, content security services make up most of the SaaS opportunity, and even though large organizations procure most of the services across the globe, small to medium businesses are showing keen interest in such solutions.
On the negative side, the managed encrypted VPN services market declined marginally in 2008 over 2007 to register more than $ 20 billion because Multi Protocol Label Switching (MPLS) VPN services appeared to divert revenue streams away from encrypted services due to heightened prioritization, and selective and cautious procurement because the economy is so bad.
A recent market research effort titled, “'Federal IT Market Forecast 2009-2014,' by different analysis firm found that significant growth in cloud computing, Service Oriented Architecture (SOA), and cyber security over the next five years will directly impact federal government IT spending.
The agency predicted that federal government demand for IT products and services would grow at a compounded annual rate of 3.5 percent over the next five years, reaching $ 90 billion in total market value by 2014, up from $ 76 billion in 2009, and the main reason for assured growth was the government’s overall IT initiative.
Cloud computing is expected to generate more than $ 1 billion over the next half a decade with an anticipated growth rate of 30 percent per year, said the report, because of projected cost savings, enhanced working speed, built-in redundancy and the near elimination of costly computational systems per individual.
The report claimed only 1 in 10 dollars is allocated towards security even though federal government will increase information security spending from $ 8.2 billion in 2009 to $ 12.2 billion by 2014 at a compound annual growth rate (CAGR) of 8.3 percent.
The good news is that the government is show signs of taking National cyber security very seriously. Melissa Hathway had led former President Bush’s $ 6 billion per annum Comprehensive National Cyber security Initiative, and she also led a 60 day review, which was ordered by President Barack Obama and started in the second week of February this year, of the nation’s cyber security to examine how well the U.S. federal agencies use technology to protect data, thwart spies and malicious hackers.
During the review period Hathway’s duties included an inventory of what was already being done and recommendations on how processes, policies and procedures can be improved.
An earlier report, “Cyber Chief Centered Concern, Clarion Call” said that high ranking IT and influential government persona are clamoring that the cyber security constitutes enough of a clear, present and ongoing danger to merit the head be located at the White House with non-negotiable authority, a substantial budget and comprehensive accountability.
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