Western European Security Software Forecast and Analysis, 2001-2006

In 2001, the Internet security software markets endured a "perfect storm" - the combination of the economic recession and the events of September 11. The year began on a sunny note, with the major players all reporting strong year-over-year growth from 2000. However, by midyear, the economic recession in the United States had started to take its toll, spilling over to the Western European economy. The tragic events of September 11 added to the malaise. The software market also had to adapt to the growing trend toward the deployment of security appliances. In addition to the recession and the events of September 11, the accounting changes adopted by Computer Associates (CA) added another dimension to the "storm". CA's change in its accounting methods had a major impact on the year-over-year growth of both the security market and the software market as a whole.

SecuritySecurity 3As and secure content management (SCM) are the largest segments and have a combined market share of 75%. In comparison firewalls/VPNs, encryption and intrusion detection software share the remaining 25%, with firewall/VPNs being the larger segment among this subgroup. Alles zu Security auf CIO.de

Although security software has failed to meet initial expectations, it rode out the storm rather well compared to other IT markets. The Western European Internet security software market still managed to achieve double-digit growth (27.3%) from 2000 to 2001 and topped the $1.6 billion mark in Western European revenue.

The Western European security software market is still highly fragmented, with no single vendor gaining more than 10% market share. Symantec is the new undisputed European security software champion ($165 million). Firewall software dominator CheckPoint comes in at second overall with a revenue of $133 million in 2001. Last year's leader, Network Associates, drops to third place with a 2001 revenue of $124 million. The top three vendors - Symantec, CheckPoint Software Technologies and Network Associates - managed to achieve double-digit growth. Computer Associates' new accounting model has resulted in a 29.9% drop for 2001 revenue figures.

IDC believes the Western European Internet security software market will rebound in 2002 and continue to show strong growth through 2006. The total Western European Internet security software market will reach $4.3 billion by 2006, representing a 17% CAGR. Market growth will increase as enterprises continue to open access to more data by employees, partners and customers. Corporations will look for security solutions that are centrally managed and can address both cost and security concerns.