Security server market shows good growth, reveals IDC


18 Mar 2004

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Western Europe’s security server market grew by 46.2pc in the final quarter of last year, new data from IDC has shown. These appliance-style devices allow businesses, particularly small and medium-sized enterprises, to implement IT security procedures simply and cost-effectively.

Factory revenue for the devices came to US$132.4m for the fourth quarter, an increase of 46.2pc over the same period in 2002.

Western Europe performed better than any other region tracked by IDC and gained additional share to account for 30.1pc of worldwide revenue for the quarter. The research also showed unit growth of 47.1pc, with appliance shipments reaching 63,721.

Strong annual performance also accompanied dramatic growth rates over the sequential period, with revenue up by 36pc and unit shipments by 47.2pc. While the fourth quarter is typically robust, such large quarter-on-quarter growth demonstrates the continued opportunities for vendors in the region.

According to IDC, much of the growth can be attributed to a very healthy quarter for firewall/VPN appliances, which comprise the majority of the market. Oliver Harcourt, research analyst for IDC’s European Enterprise Server research team commented: “Over previous quarters the growth of firewall/VPN appliances has been slowing somewhat as the market reached a level of maturity. But vendors in this space continue to evolve to meet user requirements and look for innovative ways to fuel growth. For example, we are increasingly seeing vendors offer the ability to integrate additional security applications alongside the default firewall/VPN functions. This provides a cost-effective and simple means, particularly for SMBs and remote or branch offices, to meet growing and increasingly complex security requirements.”

Cisco retained the lead among manufacturers with 31.4pc market share, showing solid growth during the quarter. Nokia returned to growth and its share rose slightly over the third quarter to 15.9pc. NetScreen was the third-ranked vendor and another quarter of strong growth saw it improve its share slightly to 12.6pc. The only change in the vendor rankings over the previous quarter saw SonicWALL overtake WatchGuard to become the fourth-ranked supplier.

Carla Arend, senior research analyst with IDC’s European Software Group, explained the appeal of the security systems. “As European organisations develop security policies, they are turning to appliances as an easy way to enforce the required security across subsidiaries and branch offices. Many organisations choose one particular appliance model and define it as the company wide standard for all remote sites and even business partners. This approach leads to increased efficiency through the simplified management of appliances that can increasingly be centralised. Additionally, it is a convenient way to achieve compliance with security regulations.”

Intrusion-detection appliances continued to show good growth over the year, IDC found, although quarter-on-quarter growth slowed slightly in the fourth quarter, to 23.5pc. The firm said that it was not yet clear whether these devices would move beyond being a niche product.

By Gordon Smith