2020 was an unprecedented and disruptive year for individuals, corporations and nations alike. However as much as things change, some continue to remain the same, with cyber-attacks being one such thing. Cyber-attacks continued unabated during 2020, with well over 100 major cyber incidents during the year. As a result, cybersecurity spending is forecast to grow, even as the world economy is forecast to decline sharply. M&A activity in the sector was very strong in 2020 and is expected to continue to grow in 2021. In this report we focus on five key sub-sectors of cybersecurity, which are the largest and fastest growing areas.
COVID-19 has caused unprecedented disruption globally, with the global economy expected to decline by the most since at least the end of the Second World War. However cyber-attacks and breaches have continued unimpeded; even as the world struggles to get the pandemic under control. There have been over 100 major significant cyber incidents in 2020, a year in which most of the world has been in partial lockdown. The attacks seem to have emanated from an array of bad actors including state-backed agencies, in countries ranging from North Korea and China to Iran and Russia; to criminal gangs, intent on stealing financial assets, commercial secrets as well as sabotaging the functioning of physical infrastructure.
Global spending on information security is forecast to have increase 2.4% in 2020 to US$123.8bn, according to data from Gartner, which is significantly lower than its previous forecast of 8.7% growth for 2020; resulting from the negative impact of the COVID-19 pandemic.
The 2.4% growth forecast for cybersecurity however is far ahead of the 5.4% decline Gartner forecasts for global IT spending in 2020. Cloud Security is forecast to be the fastest growing cybersecurity sub-sector with a 33.3% YoY growth in in 2020, followed by data security (+7.2% YoY) and application security (+6.2% YoY). Networking security equipment is forecast to be the most severely impacted by spending cuts in 2020 and are forecast to decline - 12.6% YoY followed by consumer spending on security software at -0.3% YoY.
Worldwide spending on information security is forecast to grow at a CAGR of 8.1% over the 2020-2024 period, according to IDC, benefitting from a global economic recovery from the impact of COVID-19 pandemic. Information security spending is expected to increase to US$174.7bn in 2024. IDC forecasts Security Services to continue to be both the fastest growing as well as the largest subsector within global information security.