Managed Security Services Market

Market Overview:

The global managed security services market size reached US$ 28.2 Billion in 2022. Looking forward, IMARC Group expects the market to reach US$ 54.3 Billion by 2028, exhibiting a growth rate (CAGR) of 12.80% during 2023-2028. The considerable rise in the cases of cybersecurity threats, increasing concerns regarding compliance with stringent data protection and privacy regulations, and rising need for cost-effectiveness and scalability in organizational operations are some of the major factors propelling the market.

Managed security services (MSS) refer to a wide range of outsourced cybersecurity services that help manage and protect information systems and data of an organization from various cyber threats. MSS providers continuously monitor the client's systems and networks and leverage threat intelligence sources and offer incident response services to identify and respond to emerging cyber threats. By assessing the security posture, MSS deploys security tools to provide real-time threat response while generating regular reports for system health and insights. In addition to this, MSS services assist in identifying and patching vulnerabilities in systems and applications as well as offer advisory services to develop security strategies, policies, and frameworks.

The market is primarily driven by the growing shortage of skilled cybersecurity professionals on the global level. In line with this, easy access to experienced security experts responsible for managing security incidents on behalf of the clients provided by MSS providers is resulting in a higher uptake of this solution. In addition to this, the rising adoption of cloud computing services and the proliferation of the Internet of Things (IoT) devices resulting in evolving cyberattacks is creating lucrative opportunities in the market. Also, the rising need for continuous monitoring and immediate incident response in case of cyberattacks and data breaches is leading to higher installations of MSS solutions. Furthermore, an enhanced focus of large and small-scale organizations on their core competencies instead of resource diversion in managing security operations is impacting the market positively.

Managed Security Services Market Trends/Drivers:

Rise in the cases of cybersecurity threats

Organizations around the world face significant cybersecurity risks in today's digital landscape because of the sophistication and persistence of cyber threats. Due to the rise of data breaches, ransomware attacks, and advanced persistent threats, businesses are under increasing pressure to strengthen their security measures. A rise in demand for Managed Security Services (MSS) has been observed in response to these evolving threats. A MSS provider can assist organizations in strengthening their defenses, detecting vulnerabilities, and responding to security incidents quickly by offering specialized expertise, advanced technologies, and proactive security measures. Cyberattacks can be mitigated and financial and reputational damage can be minimized by leveraging MSS to enhance security posture, safeguard sensitive data, and protect assets.

Growing need for compliance with stringent regulatory requirements

The increasing concerns regarding compliance with data protection and privacy regulations across a wide variety of industries is a significant growth-inducing factor for the market. Data protection laws, such as GDPR and CCPA, have been enacted by governments and regulatory bodies to protect the privacy rights of individuals. In addition to substantial financial penalties, non-compliance can damage a business's reputation. This complex compliance landscape requires managed security services (MSS) providers to play a crucial role in assisting organizations to implement robust security measures. As a result, higher deployment of MSS to curate advanced monitoring systems, regular security assessments, and detailed audit trails to prove compliance is creating a positive market outlook. With rapidly changing data protection and privacy regulations, the expertise of MSS providers in aligning security practices with regulatory requirements are enabling organizations to mitigate risks and maintain regulatory compliance, thereby resulting in a higher uptake of MSS.

Rising need for cost-effectiveness and scalability

The rising need for cost-effectiveness and scalability is creating lucrative growth opportunities in the market. Establishing an in-house security operations center (SOC) requires significant investment in infrastructure, hiring and training security staff, and maintaining advanced security technologies. The MSS model offers a less expensive alternative by pooling resources and expertise across multiple clients in order to provide organizations with top-tier security capabilities without incurring high upfront costs. Moreover, MSS providers can scale their services in accordance with client requirements, whether they are expanding operations, adapting to changing threat landscapes, or accommodating seasonal variations. A dynamic cybersecurity landscape demands businesses to stay adaptable in order to optimize their security investments, and as a result there is a growing demand for MSS solutions.

Managed Security Services Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the global managed security services market report, along with forecasts at the global, regional, and country levels from 2023-2028. Our report has categorized the market based on type, deployment mode, enterprises size, and vertical.

Breakup by Type:

• Managed SIEM
• Managed UTM
• Managed DDoS
• Managed XDR
• Managed IAM
• Managed Risk and Compliance
• Others
   

Managed SIEM dominates the managed security services market

The report has provided a detailed breakup and analysis of the managed security services market based on the type. This includes managed SIEM, managed UTM, managed DDoS, managed XDR, managed IAM, managed risk and compliance, and others. According to the report, managed SIEM represented the largest segment.

Managed SIEM are mostly preferred by organizations and are largely adopted due to the rising frequency and complexity of cyber threats and the rising need to enhance their threat detection and response capabilities. Also, the increasing outsourcing of managed SIEM providers in organizations allows them to leverage specialized skills and technologies that they lack to effectively manage their SIEM systems. Furthermore, the implementation of stringent regulatory compliance mandates, such as GDPR and HIPAA is driving the adoption of the segment for establishing compliance.

On the other hand, the growing frequency and intensity of DDoS attacks causing significant disruption to businesses resulting in increasing concerns over data breaches and unauthorized access is driving the segment growth. Also, various compliance standards such as PCI DSS, HIPAA, and GDPR mandating robust security measures, are driving the demand for comprehensive security solutions like UTM, Managed XDR, Managed IAM, and managed risk and compliance, which provide multiple security functions in a single platform.

Breakup by Deployment Mode:

• On-premises
• Cloud-based
   

Cloud-based represents the largest managed security services market segment

The report has provided a detailed breakup and analysis of the managed security services market based on the deployment mode. This includes on-premises and cloud-based. According to the report, cloud-based represented the largest segment.

The scalability and flexibility offered by cloud-based deployment, enabling organizations to be easily adaptable to the security infrastructure as per their needs, is resulting in a higher utilization of the segment. In addition to this, the avoidance of significant upfront investments in hardware and infrastructure in case of cloud-based solutions is also propelling the segment growth. Furthermore, the availability of remote accessibility in cloud-based security services, resulting in secured data and systems regardless of location is further creating a positive outlook for the segment.

On the other hand, highly regulated industries have strict data security policies and prefer to have full control over their security infrastructure. As a result, they prefer on-premises deployment to have physical control over their security systems and data. In addition, in organizations with legacy systems or infrastructure, on-premises deployment offers a higher level of convenience to integrate security solutions with their existing systems seamlessly.

Breakup by Enterprises Size:

• Small and Medium-Sized Enterprises
• Large Enterprises
   

Large enterprises represent the largest segment in the managed security services market

The report has provided a detailed breakup and analysis of the managed security services market based on the enterprises size. This includes small and medium-sized enterprises and large enterprises. According to the report, large enterprises represented the largest segment.

Large enterprises deal with complex IT environments that involve multiple systems, networks, and endpoints. By leveraging managed security services, they are able to manage complexity and effectively secure their entire ecosystem. Large enterprises also benefit from these services because they help them meet stringent compliance regulations and mitigate their higher security risks. In order to optimize their internal resources, organizations can outsource security management, allowing in-house IT teams to focus on core business functions.

On the other hand, the rising need for cost-effective alternatives to building an in-house security team and infrastructure is leading to a higher uptake of managed security services in SMEs. In addition to this, the presence of limited resources and IT expertise in SMEs is leading to the higher deployment of MSS solutions, enabling them to leverage the skills and experience of external security providers without the need for dedicated internal security personnel.

Breakup by Vertical:

• BFSI
• Healthcare
• Manufacturing
• IT and Telecom
• Retail
• Defense/Government
• Others
   

BFSI holds a significant share in managed security services market

A detailed breakup and analysis of the managed security services market based on the vertical has also been provided in the report. This includes BFSI, healthcare, manufacturing, IT and telecom, retail, defense/government, and others. According to the report, BFSI accounted for the largest market share.

The main factors that are driving the growth of this segment are the stringent regulations necessitating compliance with data protection and security requirements in the BFSI sector. This can be ensured through managed security services by safeguarding sensitive customer information and adhering to standards such as PCI DSS.

Managed security services are essential in preventing financial losses by detecting and thwarting unauthorized access to financial systems, thereby mitigating the risk of cybercriminals targeting the BFSI sector. Moreover, these services offer proactive threat monitoring and incident response to protect the reputation of financial institutions, thereby minimizing the potential damage caused by security breaches and resulting in the segment growth.

On the other hand, healthcare, manufacturing, IT and telecom, retail, defense/government, face unique security challenges and risks, due to which they require MSS solutions to cater to industry-specific threats by providing tailored solutions and expertise.

Breakup by Region:

• North America
  • United States
  • Canada
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Others
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

North America exhibits a clear dominance, accounting for the largest managed security services market share

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Europe (Germany, France, the United Kingdom, Italy, Spain, and others); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. 

North America held the biggest market share since the region has a well-developed digital infrastructure resulting in a higher volume of cyber threats, including data breaches and ransomware attacks. This is leading to an augmented demand for robust managed security services across the region.

In addition to this, the implementation of stringent regulatory regulations by regulatory authorities, encompassing data protection and privacy regulations like CCPA and NYDFS Cybersecurity Regulations, are necessitating the use of managed security services. The emerging technological innovation hub in the region is resulting in businesses rapidly adopting new technologies. Apart from this, North America is facing a shortage of skilled cybersecurity professionals, thereby posing challenges in organizations to maintain robust security internally and utilizing managed security services on a large scale.

Competitive Landscape:

The top players in the global managed security services market are conducting extensive research and development (R&D) activities focusing on comprehensive and innovative solutions while addressing evolving cybersecurity challenges. They are focusing on enhancing their threat intelligence capabilities by leveraging artificial intelligence (AI) and machine learning (ML) algorithms to analyze large-scale security data in real-time. In line with this, the major companies are expanding their service offerings to include a wide range of managed security services in their portfolio to provide end-to-end security services. Furthermore, the key players are entering into strategic partnerships and collaborations with technology providers, system integrators, and industry experts to access new customer segments and gain a competitive edge.

The report has provided a comprehensive analysis of the competitive landscape in the global managed security services market. Detailed profiles of all major companies have also been provided. Some of the key players in the global managed security services market include:

• AT&T Inc.
• Atos SE
• BAE Systems plc
• Broadcom Inc.
• BT Group plc
• Capgemini SE
• DXC Technology Company
• International Business Machines Corporation
• SecureWorks Inc. (Dell Inc)
• Trustwave Holdings, Inc.
• Verizon
• Wipro Limited

Recent Developments:

• In June 2023, AT&T launched their new Generative AI Tool, Ask AT&T that uses OpenAI’s ChatGPT functionality, and is also designed to be interoperable with other generative tools, to boost employee creativity and productivity.
• In June 2023, Eviden, an Atos business focusing on advanced computing announced a major $100M contract with NCMRWF to build two new supercomputers dedicated to weather modelling and climate research for IITM and NCMRWF in India.
• In June 2023, the Combat Mission Systems business of the conglomerate BAE Systems Inc. received the Defense Counterintelligence and Security Agency (DCSA) 2023 James S. Cogswell Outstanding Industrial Security Achievement Award for their industrial security excellence. 
   

Managed Security Services Market Report Scope:

Key Questions Answered in This Report:

• How has the global managed security services market performed so far, and how will it perform in the coming years?
• What are the drivers, restraints, and opportunities in the global managed security services market?
• What is the impact of each driver, restraint, and opportunity on the global managed security services market?
• What are the key regional markets?
• Which countries represent the most attractive managed security services market?
• What is the breakup of the market based on the type?
• Which is the most attractive type in the managed security services market?
• What is the breakup of the market based on the deployment mode?
• Which is the most attractive deployment mode in the managed security services market?
• What is the breakup of the market based on the enterprises size?
• Which is the most attractive enterprises size in the managed security services market?
• What is the breakup of the market based on the vertical?
• Which is the most attractive vertical in the managed security services market?
• What is the competitive structure of the global managed security services market?
• Who are the key players/companies in the global managed security services market?

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the managed security services market from 2017-2028.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global managed security services market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the managed security services industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.