Analysis of the North America Managed & Professional Security Services Market, Forecast to 2021

Expansive Market Opportunities, But Competition Looms Large
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Published: 30 Jan 2018

The North American managed and professional security services market totaled $7.2 billion in 2016 and is projected to increase at double-digit rates annually almost throughout the entire forecast period. The increasing volume, diversity, and sophistication of cyber threats aimed at a broadening exposure footprint, and the mounting severity of direct and indirect implications attributed to inadequate or outdated security practices, plus challenges of in-house staffing and adaptation are durable contributors to market demand. The competitive landscape is highly diverse with providers from a myriad of backgrounds. The largest competitors, as measured by revenues, are firms with a deep history in serving the government and consulting firms. Their revenues are concentrated in professional security services. Next, with a mix of managed and professional security services, the fewer in number but sizable individually pure-play security service providers constitute the next tier. Much greater in number, communication service providers (telcos), security product vendors, local and regional IT services firms, cloud management providers, and managed Security-as-as-Service (SECaaS) providers round out the competitive landscape. Competition among providers will intensify, compelling providers to ratchet upward their investments in technological innovation, sales & marketing, and strategic acquisitions. Simultaneously, pricing pressure will intensify as will client expectations for tangible demonstrations of security services’ essentialness and business return. The managed and professional security services market is a high growth, dynamic market. The number and variety of competitors continue to increase. Consequently, the competitive playing field is intensifying. Although numerous durable factors driving market demand are present, there are also other factors that will dampen demand. For example, self-service, automation, containerization, and standardization, hallmarks of cloud services, will reduce market opportunities as organizations, justifiably or not, gain a stronger sense of prowess in cyber risk management with their cloud deployments. In turn, this segment of demand for managed and professional security services will not reach the level of security services demand in non-cloud environments. Profitability for service providers will also become more difficult to maintain as honing "means to serve" is an ever-present expenditure. Innovating through use of advanced technologies, building and re-building intellectual property, and marketing and sales investments must continue to remain a relevant provider. Also, like their clients, managed and professional security service providers confront the same challenging and expensive staffing issues (e.g., wage increases, periodic training, and retention). Finally, security services clients expect tangible results and outcomes that demonstrate they are receiving a favorable return on their expenditures on managed and professional security services. As with any fixed-term service arrangement, each service provider is at risk of not having its contract renewed, being replaced by another provider, or not considered for additional service engagements. Earning customer trust and appreciation must be a top priority in order to thrive as a managed and professional security service provider. In Analysis of the North America Managed & Professional Security Services Market, Forecast 2021 - Expansive Market Opportunities, But Competition Looms Large, Frost & Sullivan delves into the drivers and restraints of the managed and professional security services market, estimates its current size and forecasts its growth, and adds color to the competitive landscape.



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