Encryption Software Market to Reach $2.16 Billion by 2020 – Allied Market Research

According to a report by Allied Market Research, titled Global Encryption Software Market – Size, Industry Analysis, Trends, Opportunities, Growth and Forecast, 2013-2020 ($4,515), the global encryption software market is expected to reach $2.16 billion by 2020, registering a CAGR of 14.27% during 2014-2020.

Software-based encryption is gaining prominence as one of the end point security solutions, as it is increasingly being adopted by the organizations worldwide. With data protection and data privacy compliance becoming a priority, organizations have started viewing encryption as an enabler to achieve compliance and data security and at the same time mitigate the data breach risks associated with the adoption of advanced technologies, particularly cloud services and mobility.

From the application perspective, encryption is used across all the industries to secure both data-at-rest (data stored in data stored in files/folders and disks); and data-in-transit (email messages travelling over the network).

The adoption of software-based encryption for protecting data-at-rest is higher as compared to the adoption of the same for data-in-transit. Data-at-rest encryption software accounts for approximayely 93.5% of the total encryption software market by value.

For data-at-rest, the two most commonly used encryption software methods include Full Disk Encryption (FDE) and File Level Encryption (FLE), with FDE software being the most widely deployed method for protecting data against theft and ensuring compliance with the data privacy and data breach notification laws. FDE is preferred over the FLE, primarily due to the two major advantages such as ease of deploymen and management and complete security.

Presently, software-based encryption enjoys the highest adoption in the financial services sector with a growing acceptance in the healthcare sector. Financial sector accounts for approximately 44% of global encryption software market amongst all the other industries. Entities operating in the sector are mandated by the data privacy regulations to adopt effective security measures in their organization and need to ensure that the personally identifiable data (PII) of the customers is protected from any unauthorized or unintended disclosure/access.

Key findings of the study:

• Presently, encryption software for data-at-rest accounts for the major share of the encryption software market as compared to the encryption software for data-in-transit (email)
• Within the data-at-rest encryption software market, software- based FDE holds the majority share vis-à-vis FLE, with FDE expected to be the more widely adopted technology in 2020
• Based on the geographic analysis, North America presently is and would continue to be the highest revenue-generating region, throughout 2014-2020. However, the growth would be higher in the developing regions particularly APAC
• The use of encryption software is most widespread in the finance Sector, which is presently largest contributor i.e. approximately 44% to the total encryption software revenue
  The adoption of encryption software is higher amongst large enterprises compared to the small and medium sized businesses

The evolving data protection regulatory landscape, burgeoning number of data breaches coupled with the increasing adoption of technologies particularly cloud are driving the adoption of encryption software worldwide. A large number of organisations are adopting an enterprise wide encryption strategy plan rather than informal policies.

With the rapidly increasing adoption of cloud services in all the sectors, the organisations are now looking at encryption solutions that would ensure data security and compliance with the data privacy regulations for their data in the cloud. Furthermore, the highest interest will be in encryption solutions from cloud security vendors.