The International Data Corporation (IDC) predicts that global expenditure on security solutions and services will rise to $219 billion in 2023, indicating a 12.1% growth from the previous year. It also projects that cybersecurity investments in hardware, software, and services will climb to almost $300 billion by 2026.
These investments will be fueled by the persistent danger of cyberattacks, the requirements of securing a hybrid work environment, and the need to comply with data privacy and governance regulations.
Security expenditures are expected to surpass the growth rate of general IT spending, with most industries and company sizes witnessing low double-digit growth until 2026. This trend will be driven by the widespread adoption of cloud and container deployments, the necessity of securing remote access to resources, and the increasing compliance requirements of privacy and data protection regulations.
The more established industries and the biggest spenders are predicted to expand faster than the average, as they invest in innovative security solutions to defend their dispersed workforce from ransomware attacks and protect their essential infrastructure, which is becoming more connected to IT networks.
Banks and Governments are among those that will deliver the largest security investments
Banking, Discrete Manufacturing, Professional Services, and Federal/Central Government will be the industries with the most significant investments in security products and services in 2023.
Banks and discrete manufacturers are expected to allocate their expenditures evenly between software and services, with managed security services receiving the bulk of the investment to combat cyberattacks.
Meanwhile, Professional Services will prioritize software, with a specific emphasis on governance, risk, compliance (GRC), and endpoint security. Federal/Central Government will prioritize services spending as well.
Together, these four sectors will represent over a third of all security spending in 2023. Securities & Investment Services, Telecommunications, and Banking are expected to experience the highest growth in spending over the 2021-2026 forecast period.
In 2023, the software is set to be the largest technology group, making up approximately half of all security spending. Endpoint Security will be the primary software category, followed by Identity and Digital Trust software, and Cybersecurity Analytics, Intelligence, Response, and Orchestration software.
Services will rank as the second most significant technology group, with Managed Security Services as the leading category, expected to reach $42 billion in spending this year.
Network Security Appliances will dominate hardware spending. Over the next five years, the software is expected to have the highest compound annual growth rate at 13.7%, followed by Services at 11.0%.
Discrete Manufacturing and Professional Services will lead the security spending in the US
In 2023, the United States will be spending the most on security. Within the US, Discrete Manufacturing and Professional Services will be the primary industries investing in security solutions.
In Western Europe, Banking and Discrete Manufacturing will be the primary industries investing in security solutions, making it the second-largest region for security spending.
The Asia/Pacific region (excluding Japan and China) and the People’s Republic of China will follow as the next most significant regions for security spending. China is expected to experience the most rapid growth in security spending over the 2021-2026 forecast period, with a compound annual growth rate of 18.8%.
IT security spending in Europe is expected to continue growing at a rate of over 10% throughout the forecast period. Services will continue to represent the largest portion of that spending, particularly for organizations with limited security expertise seeking to safeguard their data and assets against the heightened risk of ransomware attacks exacerbated by current geopolitical conditions in the region.
The finance sector, which must also maintain regulatory compliance, and the manufacturing sector, which is increasingly targeted by cyberattacks on production facilities, will be the top IT security spending industries in Europe.
Source: IDC
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