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Security

SaaS-based network security scores $1.2B in revenue for Q3 2021 – report

Spikes in ransomware and malware attacks likely keep CISOs up at night, but the network security market is resting easy as it benefits from increased demand for cybersecurity services in Q3 2021.

Revenue for software-as-a-service (SaaS)-based network security, which includes cloud-delivered email security, Secure Web Gateway (SWG) and Web Application Firewalls (WAF), increased 26% year-over-year to reach $1.2 billion in Q3 2021, according to a recent Dell'Oro Group report.

"This quarter's growth reflects an uncommon alignment between enterprise IT teams asking for more security investment and business leadership willing to do so," Mauricio Sanchez, research director, network security at Dell'Oro Group, said in a statement.

The potential impact of cybersecurity threats on enterprises is becoming increasingly troublesome as bad actors have started teaming up to share their "best practices" for deploying ransomware, for example. In a recent Light Reading podcast, Bruce Snell, VP of security strategy and transformation at NTT Security, discussed a new disconcerting trend – the ransomware-as-a-service market.

"Year-over-year [ransomware attacks] becomes a bigger issue," said Snell. "The thing that worries me the most is the development of the ransomware-as-a-service market, and I think that'll cause us the biggest trouble moving forward."


On this episode of The Light Reading Podcast, NTT's Bruce Snell covers some of the biggest cybersecurity trends of 2021 and shares advice for how organizations can better manage and secure their data.


These new security threats, enterprises' move to the cloud and pent-up demand for security services are among the drivers boosting the SaaS-based network security market, according to Dell'Oro. This market has also "largely overcome the supply chain chaos affecting other markets, as vendors have deftly maneuvered to satisfy demand," said the research firm.

In addition, SaaS-based SWG revenue increased 35% YoY in Q3, and will likely exceed $2 billion in revenue for 2021. Dell'Oro notes that SWG now has a new moniker – Secure Service Edge (SSE) – which is a shortened version of Gartner's term Secure Access Service Edge (SASE) that defines the convergence of networking and security services.

Physical firewall appliance revenue also rose 14% YoY in Q3 and is projected to reach $10 billion for 2021.

"While spend on more modern Secure Access Service Edge (SASE) and Zero Trust approaches skyrocketed, even that for the more traditional perimeter firewall experienced healthy growth," said Sanchez.

— Kelsey Kusterer Ziser, Senior Editor, Light Reading

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