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The Internet of Things (IoT) security market is expected to grow from $6.89 billion (USD) in 2015 to $28.90 billion by 2020, according to a new market research report published by Markets and Markets.
That is not a typo … and neither is this:
A McKinsey & Company report estimates that the IoT has a total potential economic impact of $3.9 trillion to $11.1 trillion a year by 2025. At the top end, that level of value would be equivalent to about 11 percent of the world economy.
VCs and startups love to talk about T.A.M. (Total Addressable Market), meaning, how big is a market and how many companies can you sell to. In the rare air of trillions, the IoT space is going to see a lot of rocket launchers.
Research firm Gartner states that approximately 3.9 billion connected things were in use in 2014 and this figure is expected to rise to 25 billion by 2020.
When you line up the forecasted number of IoT devices in 2020 to the forecasted IoT revenues by 2020, we can round off to a dollar per connected thing for security.
What exactly is a “thing” anyway? To keep it simple, let’s just say it’s any non-computer device that connects to the Internet. So we’re talking smartphones, TVs, wristwatches, kitchen appliances, game consoles, cars, planes, manufacturing plant equipment, traffic lights, you name it – even pets and farm animals with tracking chips inside them. Internet sensors are getting put on anything and everything.
According to an HP study, 70 percent of the most commonly used IoT devices contain security vulnerabilities.
It’s always fun to play with numbers. You think we can ratchet up the security-per-thing to two dollars? That would move the market forecast needle up to nearly $60 billion by 2020.
“By its very design, the Internet of Things is built with lightweight security,” explains Terrence Gareau, chief scientist, Nexusguard. “These devices rely heavily on shared libraries and a rapid development cycle. Because of their constraints, many IoT devices have limited options for firmware upgrades and other risk-management features. The fact that they are also “always online” makes them highly susceptible to intrusion and attacks.”
Who are some of the hot startups and emerging players in the IoT security space? And what about the big security brands?
Stay tuned! We’ll tell you next week, right here at SandHill.com.
Steve Morgan is founder and CEO at Cybersecurity Ventures and editor-in-chief of the Cybersecurity Market Report and the Cybersecurity 500 list of the world’s hottest and most innovative cybersecurity companies. Follow Steve on Twitter or connect with him on LinkedIn.