SOURCE: Infonetics Research

January 31, 2007 18:21 ET

Hot topics for network security providers: Content security, security/access bundling

CAMPBELL, CA -- (MARKET WIRE) -- January 31, 2007 -- Network security service providers participating in a new study by Infonetics Research say their top 4 new revenue opportunities are integrated services, intrusion prevention, content security, and VPN services.

The study, "Service Provider Plans for Security, IPSec, and SSL: North America, Europe, and Asia Pacific 2007," also says NAC and content security/clean pipes showed up on the radar of managed security providers in a big way in 2006.

"Many providers are attempting to build services for NAC and content security, demonstrating their continuing desire to blur the demarc between the customer's network and their own, making their role in the customer's network more important and their services stickier," said Jeff Wilson, principal analyst at Infonetics Research and lead author of the study.

Most of the providers surveyed already offer bundled services that combine security and access, often billed as 'clean pipes' services. Most providers believe they can charge an additional 10% to 20% for cleaning traffic before handing it off to customers, and a few even say the premium is potentially greater than 20%. These are the kind of high margins that drive providers to offer managed security in the first place, and 'clean pipes' services that run off of highly scalable network-based infrastructure are becoming more attractive and more common.

Study Highlights

--  Average revenue from managed security services for providers
    interviewed by Infonetics will grow 22% between 2006 to 2008, from $377
    million to $459 million; incumbents expect the biggest increase (55%),
    competitives the smallest (33%)
--  85% of the service providers Infonetics interviewed say keeping up
    with new security threats is their biggest technical challenge; 63% say
    scaling the service infrastructure is a big challenge -- not a bad problem
    to have since this points to broad acceptance
--  Marketing new services is the leading business challenge faced by
    respondent providers, followed by competition from large telcos and ISPs
--  100% of the incumbents and 86% of the specialized security service
    providers interviewed believe a service provider could be involved in a
    full NAC implementation
--  86% of the competitive providers interviewed say they have no role in
    a NAC rollout or should only be involved in NAC when it's a remote access
    or extranet rollout
--  IPSec is still the top technology for remote access VPN services, but
    in the next year providers expect an average of nearly 1/3 of remote access
    VPN revenue will come from SSL
--  Top 3 network security product manufacturers, according to service
    provider responses to an unaided brand awareness question: Cisco, Check
    Point, Symantec
Infonetics' study segments the market and examines the implementation plans of North American, European, and Asian service providers that sell managed network security services, including incumbents, competitive providers, and specialized security service providers. The providers interviewed generate over 2/3 of the world's managed network security service revenue.

The study features scorecards with service provider ratings of 7 network security manufacturers (Cisco, Check Point, ISS, Juniper, Nortel, SonicWALL, and Symantec) based on 8 criteria: technology, product roadmap, security, management, value, pricing, financial stability, and service and support. Cisco received the highest marks for financial stability and fairly low marks for pricing and price-to-performance ratio. ISS, Juniper, and Cisco received the highest marks for security.

Download study excerpts at For sales, contact Larry Howard, vice president, at or +1 (408) 583-3335.

Infonetics Research ( is the premier international market research and consulting firm specializing in data networking and telecom. Services include quarterly market share and forecasting, end-user survey research, service provider survey research, and service provider capex analysis.

Contact Information

  • Press Contact:
    Jeff Wilson
    Principal Analyst, VPNs and Security
    Infonetics Research
    Email Contact