Global Market Insights Predicts Growth of Encryption Software Market
On-premises deployment of email encryption software will remain strong; migration to cloud platforms driving cloud-based encryption software.
Note: TDWI’s editors carefully choose vendor-issued press releases about new or upgraded products and services. We have edited and/or condensed this release to highlight key features but make no claims as to the accuracy of the vendor's statements.
According to Global Market Insights, Inc., the encryption software market will exceed U.S. $20 billion by 2026. The market growth is attributed to supportive government initiatives to combat cybercrimes and the rising instances of data breaches globally.
For example, in November 2019, China’s State Cryptography Administration (SCA) published a draft of an encryption law that will regulate encryption in the private and public sectors. The draft also sets guidelines for using cryptography to safeguard national security. The growing implementation of disk, email, and mobile encryption capabilities in security suites provided by cybersecurity vendors to address the evolving threats will augment encryption software market growth.
The email encryption software market is expected to hold a share of over 25 percent in 2026 due to the rising uptake of security software to protect data from malware, identity theft, and phishing. Because email is among the most widely used enterprise communication methods, the demand for email data protection software to secure email systems (including content, media attachments, or email access) increases. The software encrypts data in transit and at rest and supports multifactor authentication for additional security, ensuring that sensitive information is always protected in line with regulatory compliance.
The on-premises deployment model segment held over 70 percent of the market share in 2019 and is projected to maintain a dominant position over the forecast timeline. Enterprises prefer an on-premises deployment due to the high security associated with managing sensitive data in-house and access to cryptography keys for enhanced security. However, with the growing popularity of cloud platforms to store enterprise data, the demand for cloud-based encryption software is expected to accelerate over the forecast period.
The retail sector will also observe the heavy adoption of encryption to protect customer data throughout a retailer’s operations. The sector is witnessing a huge usage of third-party services to support online transactions, optimizing customer experience on their websites. This has led to a rise in the number of data breaches, exploiting sensitive customer information such as credit card and bank account details and personal credentials.
According to a report published by Thales eSecurity, a cybersecurity provider, around 75 percent of U.S. retailers experienced a breach in 2018 compared to 52 percent in 2017, exceeding the global average. The demand for cybersecurity solutions will rise significantly from 2020 to 2026, preventing theft and the compromise of customer information.
Latin America’s encryption software market is expected to grow at a CAGR of over 18 percent from 2020 to 2026 due to the rising number of cyberattacks on business-critical infrastructure, growing use of digital platforms among enterprises to conduct business transactions, and supportive government initiatives to promote cybersecurity.
For instance, since December 2019, Mexican institutions including Mexico Central Bank, the National Defense Ministry (Sedena), Mexico Supreme Court, and the House of Representatives recorded more than 45 million attempted attacks to access databases and steal information. The rapidly evolving threat landscape has compelled public and private enterprises to promote digital security to safeguard sensitive business information. Government agencies in countries including Mexico, Brazil, and Argentina are introducing cybersecurity strategies to respond to a wide array of cyberattacks.
The competition in the encryption software market is characterized by strategic partnerships, new product launches, and geographic expansion. For example, in November 2019, Sophos partnered with Telefonica U.K. (O2) to provide its products and services to Telefonica’s customers in the U.K. The partnership enables the customers to gain access to the Sophos Central cloud-based security platform to secure their organizations. The company’s products and services enable customers to minimize cybersecurity risks by using behavioral analytics and machine learning to identify known and unknown threats. In August 2018, Kapalya, a Hawaii-based cybersecurity start-up, introduced a data protection solution to secure data at rest and data in transit on private and public clouds and mobile devices. The platform allows users to work on any device, ensuring end-to-end encrypted file sharing.
Major findings of the encryption software market report include:
The industrial verticals including healthcare, retail, and BFSI (banking, financial services, and insurance) witnessed the heavy adoption of data protection solutions to protect sensitive and non-sensitive data and applications
According to the HIPPA Journal, globally the healthcare sector witnessed the highest breach costs, accounting for an average mitigation cost of U.S. $6.45 million
Cloud-based encryption software is gaining immense popularity as enterprises are migrating to cloud platforms to store massively growing enterprise data and to leverage benefits in the form of on-demand scalability and reduced operational expenses
Various small cybersecurity vendors and emerging start-ups are offering a wide range of solutions to cater to the security needs of enterprises, expanding their customer base
The emerging start-ups, including Enveil (U.S.), Cosmian (France), Duality (U.S.), and PreVeil LLC (U.S.), are focusing on fundraising activities to develop new offerings and support business expansion
For more information, visit https://www.gminsights.com/industry-analysis/encryption-software-market