EMEA Security Appliance Market Stagnant in 1Q14, Says IDC
20 Jun 2014
LONDON and PRAGUE, June 20, 2014 — According to International Data Corporation's (IDC) Europe, Middle East, and Africa Quarterly Security Appliance Tracker, the EMEA security appliance market value reached $785.5 million in 1Q14 — a 1.4% decline year on year. Shipments fell 2.3% year on year, with 171,359 units shipped.
IDC expects the EMEA security appliance market to grow by a compound annual growth rate (CAGR) of 6.3% in the five years to 2018, to reach $4.4 billion in value.
EMEA Market Highlights
Cisco is the top overall security appliance vendor, with 19.0% market revenue share in 1Q14. Cisco increased its lead over closest rival Check Point to 1.8 percentage points (from 0.9% in 4Q13).
Unified threat management (UTM) was the largest security appliance product category in 1Q14 and the only category to see growth in the quarter. UTM appliances increased 16.1% year on year to represent 48.7% of the total market value.
"The security appliance market in Europe, the Middle East, and Africa slowed down in 1Q14 despite a lively industrial production recovery both in Western and Eastern Europe," said Oleg Sidorkin, senior research analyst at IDC. "We expect overall demand for security appliances to recover in the next quarters, though the political instability in Ukraine and the economic recession in Russia, one of the most dynamic markets in the past, will have an impact on market development."
Western Europe Market Highlights
The Western European market was also lethargic, with the security appliance sector valued at $607.37 million in 1Q14 — 0.5% growth over the same quarter in 2013.
IDC forecasts that the Western European security appliance market will reach $3.46 billion in value in 2018, growing at a 6.8% CAGR over the forecast period.
"Security threats are evolving fast, attacks are gaining in complexity, and the stakes are higher than ever before for organizations of all sizes," said Romain Fouchereau, manager, security appliance research, IDC. "Unified solutions are the most simple and effective way to protect the network and were the only product segment with positive growth this quarter, and will represent over half of total security appliance revenue in Western Europe in the next five years."
Central and Eastern Europe, Middle East, and Africa Market Highlights
The security appliance market in Central and Eastern Europe, the Middle East, and Africa (CEMA) contracted 7.5% year on year in 1Q14 to reach $178.13 million in value. The decline was driven mainly by economic and political turbulence in Russia, which was triggered by the situation in Crimea and eastern Ukraine. End users in Russia, especially those affiliated with the government, have become more cautious about shipments of security solutions from Western vendors. This could open up opportunities for Chinese vendors to strengthen their influence on the Russian security market.
The forecast value growth in CEMA for 2014 was reduced from 7.2% to 1.7% year on year due to the worsening political and economic situation in Russia and Ukraine, which will have a negative impact on the regional market. The economic recovery, as well as a revival in IT spending, in these countries will depend on when the armed conflict ends. The total CEMA market is expected to grow in value terms by a CAGR of 7.9% by 2018.
"In 1Q14 Poland, Hungary, and Turkey were among the fastest-growing countries in the region," said Sidorkin. "As economic recovery in Europe is accelerating and demand in Russia and Ukraine has contracted, the developing countries in Central Europe will be among the key growth areas for security appliances in 2014."
Top 5 Vendors, EMEA Security Appliance Market Shipments (Value, $M), 1Q14
|Vendor||1Q13 Value||1Q13 Market Share||1Q14 Value||1Q14 Market Share||Growth 1Q14/1Q13|
Source: IDC, 2014
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