Cloud-based security surges in 2011, will continue to grow

The Australian market for security-as-a-service - IT security delivered through the cloud - grew 17.2% during 2011, reaching a value of $38.4 million, according to Frost & Sullivan.

The firm predicts that the cloud security market will continue to grow at a CAGR of 16.6% through to 2016, driven by continued migration from on-premise software and increasing cloud services penetration among small businesses. This would leave the market at a value of $83 million by 2016.

These figures come from the firm’s recent document, ‘A Strategic Analysis of the ANZ (Australia, New Zealand) Security as a Service Market’, which states that cloud adoption in Australia is amongst the highest in the world.

This interest in security-as-a-service has been driven by a number of factors according to Frost & Sullivan, including the desire to classify IT expenses as operating rather than capital expenses. This can offer a more predictable monthly expenditure for organisations along with other benefits such as lower up-front costs, greater standardisation, ease of upgrades and ubiquitous access.

Skills shortages are another factor; a shortage of qualified in-house security professionals has led to a dramatic increase in demand for contractors and specialist security experts, and has raised the costs for end-user organisations. Security-as-a-service removes this issue, by placing responsibility for delivery and maintenance of the security solution on the cloud services provider.

But despite this growth, organisations still hold some concerns about moving security to the cloud with the most common being fear of loss of control by outsourcing to a third-party service provider and the question of data sovereignty.

Andrew Milroy, Vice President - ICT Practice, APAC, Frost & Sullivan, said: “Although some hesitancies remain, within the past year the security-as-service market has evolved from being a niche segment to an increasingly mainstream application. The only slightly negative blip on the radar is a likely dip in 2012 due to the current economic slowdown in Australia and the ongoing crisis in global financial markets.”