Operational Technology (OT) Security Market Size By Solution (Endpoint Security, Security Information & Event Management (SIEM), Identity & Access Management (IAM), Incident Response), Service (Consulting Services, Managed Security Services, Integration Services, Training and Education, Support & Maintenance), Deployment Mode (On-Premises, Cloud, Hybrid), Geographic Scope And Forecast for 2024-2031

Operational Technology (OT) Security Market Valuation – 2024-2031

The increasing number of cyberattacks on vital infrastructure and industrial systems is the primary factor expanding the operational technology (OT) security market. As these OT systems grow more networked because of Industry 4.0 and the Industrial Internet of Things (IIoT), their susceptibility increases. Organizations are acutely aware of the potential economic devastation that an attack may create, which motivates investment in OT security solutions to protect their important industrial networks. Furthermore, these provide scalability, cost-effectiveness, and easier updates than traditional methods, making them an appealing option for many enterprises., driving market expansion is predicted to push market sales above USD 18.03 Billion in 2024 and reach USD 60.33 Billion by 2031.

Furthermore, Artificial Intelligence and Machine Learning to improve threat detection and response is embraced by the operational technology (OT) security market, while advances in secure cloud access and identity management are strengthening OT systems against increasingly sophisticated cyberattacks. The market is expected to rise steadily in the coming years to grow at a CAGR of about 16.30% from 2024 to 2031.

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Operational Technology (OT) Security Market: Definition/ Overview

Operational Technology (OT) Security entails protecting the hardware and software used to monitor and control physical objects, processes, and infrastructure in industries such as manufacturing, energy, and transportation. Its application includes protecting industrial control systems (ICS), supervisory control and data acquisition (SCADA) systems, and other critical infrastructure from cyber threats while maintaining operational continuity, safety, and data integrity. The future of OT security is the integration of advanced technologies such as artificial intelligence, machine learning, and blockchain to improve threat detection, response capabilities, and resilience in the face of evolving cyber risks, thereby promoting the advancement of Industry 4.0 and critical infrastructure protection.

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What are the Key Drives Propelling the Demand for Operational Technology Security?

The increasing incidence of cyber-attacks on industrial control systems and vital infrastructure is a major driver of the OT security market. According to the US Cybersecurity and Infrastructure Security Agency (CISA), 796 cyber events were reported to its Industrial Control Systems Cyber Emergency Response Team (ICS-CERT) in fiscal year 2021. This marks a 75 percent gain over the previous year. Furthermore, IBM’s X-Force Threat Intelligence Index 2022 found that assaults on industrial control systems and operational technologies rose by 2,204% between 2020 and 2021, emphasizing the critical need for strong OT security solutions.

The rising use of IIoT devices in industrial settings is broadening the attack surface and increasing the need for OT security. According to a survey by IoT Analytics, the worldwide number of linked IoT devices is expected to reach 27 billion by 2025, with industrial IoT playing an important role. According to the US National Institute of Standards and Technology (NIST), by 2025, more than 75 billion devices will be connected to the industrial Internet. The growth of connected devices in industrial environments is introducing new risks that must be handled by OT security systems.

Furthermore, increasing government laws and compliance requirements for critical infrastructure protection are driving the OT Security market. For example, the European Union’s Network and Information Security (NIS) Directive, which went into force in 2018, mandates that operators of critical services employ suitable security measures. The Cybersecurity and Infrastructure Security Agency (CISA) of the United States revealed that cybersecurity regulations are now in place for 17 critical infrastructure sectors. These regulatory demands are driving firms to invest in OT security solutions to ensure compliance and secure key assets.

What are the Primary Hurdles Faced by the Operational Technology (OT) Security Market?

The cost of establishing and maintaining OT security solutions is prohibitively high, especially for small and medium-sized organizations (SMEs). The expense of modern security technology, continuous maintenance, and required training hinder firms from investing in complete OT security measures. This financial constraint limits the market’s potential, as many enterprises choose less effective, lower-cost options.

Furthermore, the inherent complexity of operational technology systems creates substantial barriers to successful security implementation. These systems use a combination of legacy equipment and new technology, making it difficult to integrate security solutions seamlessly. The specialist knowledge required to negotiate this complexity hinders the implementation of vital security measures, making firms vulnerable to cyber threats and operational interruptions.

Category-Wise Acumens

How Does the Increasing Demand for On-Premises Software Propel the Growth of the Market?

The on-premises segment is estimated to dominate the operational technology (OT) security market during the forecast period. Organizations confront strict regulatory obligations for data privacy and security, particularly in critical infrastructure areas. On-premises deployment gives businesses direct control over their security architecture, guaranteeing compliance with regulations and protecting critical data. This control is critical for companies where data breaches can result in serious legal and financial consequences.

On-premises solutions enable enterprises to tailor their security measures to unique operating requirements. This level of control allows firms to design security protocols that are suited to their specific operational contexts, ensuring that security measures efficiently address possible risks while maintaining operational efficiency.

Furthermore, deploying OT security solutions on-premises provides a higher level of physical security than cloud or hybrid models. Organizations can safeguard their critical infrastructure from external threats by containing sensitive systems and data within restricted environments. This is especially crucial in businesses with high-risk activities, where unauthorized access could result in substantial operational interruptions or safety problems.

Will Increasing Demand for Managed Security Services Drive the Growth of the Market?

The managed security service segment is estimated to dominate the market during the forecast period. As cyber threats become more sophisticated and frequent, businesses are increasingly turning to Managed Security Service Providers (MSSPs) for assistance. MSSPs provide specialized knowledge and resources for monitoring, detecting, and responding to threats in real-time, ensuring that operational technological environments are safe. This reliance on external knowledge greatly increases demand for managed services.

Many organizations, particularly small and medium-sized businesses, find it financially difficult to maintain an in-house security team. By outsourcing to MSSPs, they may benefit from advanced security technologies and qualified specialists without incurring the administrative costs associated with hiring and training employees. This cost-effective method enables businesses to focus on their core operations while guaranteeing strong OT security, hence fueling the growth of this service market.

Furthermore, organizations are being obliged to implement comprehensive security measures as regulatory requirements for cybersecurity in critical infrastructure sectors increase. Managed Security Services assist firms in navigating complicated compliance environments by providing bespoke solutions that meet regulatory requirements. This emphasis on compliance and risk management makes managed services more appealing, cementing their position as industry leaders in OT security.

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Country/Region-wise

Will Increasing Early Adoption of Technology in North America Drive the Growth of the Operational Technology (OT) Security Market?

According to VMR Analysis, North America is estimated to dominate the market during the forecast period. North America, particularly the United States, has a significant concentration of vital infrastructure, making it an attractive target for cyberattacks and driving the demand for OT security. According to the US Department of Homeland Security, the country has 16 key infrastructure sectors. According to the Cybersecurity and Infrastructure Security Agency (CISA), these industries account for over 2.8 million critical infrastructure installations across the country. This large network of essential infrastructure places a high demand on sophisticated OT security solutions to protect against potential cyber threats.

Furthermore, North America, particularly the United States, has a strict regulatory environment that requires strong cybersecurity protections for key infrastructure. Over 1,500 bulk power system owners, operators, and consumers must comply with the North American Electric Reliability Corporation’s Critical Infrastructure Protection (NERC CIP) regulations. According to NERC’s 2021 State of Reliability report, there were 1,213 CIP violations in 2020, indicating the continued need for stronger OT security measures. Also, the US government’s Executive Order on Improving the Nation’s Cybersecurity, released in May 2021, emphasizes the regulatory drive for improved cybersecurity in key infrastructure sectors, which is boosting the use of OT security solutions.

Will Rising Rapid Industrialization in Asia-Pacific Drive the Operational Technology (OT) Security Market?

The Asia Pacific region is estimated to exhibit the highest growth within the market during the forecast period. The Asia Pacific region is undergoing fast industrial digitalization and adoption of the Industrial Internet of Things (IIoT), increasing the demand for OT security. According to an IDC estimate, spending on the Internet of Things in Asia Pacific (excluding Japan) is predicted to reach $398.6 billion by 2023, with a compound annual growth rate (CAGR) of 12.1% for the 2018-2023 timeframe. The manufacturing sector is a significant contributor to this growth. For example, China’s “Made in China 2025” project seeks to fully overhaul Chinese industry, promoting the implementation of smart manufacturing technology. This fast digitalization broadens the attack surface for cyber threats, demanding strong OT security measures.

Furthermore, the Asia Pacific region is experiencing an increase in cyber-attacks against key infrastructure and industrial systems. According to the Cyber Security Agency of Singapore’s Singapore Cyber Landscape 2020 report, there were 16 ransomware attacks on organizations in Singapore’s vital information infrastructure sectors in 2020, up significantly from the previous year. In India, the National Critical Information Infrastructure Protection Centre (NCIIPC) claimed that cyber-attacks on critical infrastructure grew by 70% in 2019 over the previous year. The growing threat landscape is driving enterprises to invest in OT security solutions.

Competitive Landscape

The competitive landscape of the operational technology (OT) security market is characterized by a dynamic interaction of many vendors vying for a foothold in this quickly evolving sector. As enterprises appreciate the crucial need to protect their operational technology environments from sophisticated cyber threats, demand for comprehensive and creative security solutions has increased.

Some of the prominent players operating in the operational technology (OT) security market include:

• Fortinet
• Cisco
• Palo Alto Networks
• Broadcom
• Kaspersky Lab
• Nozomi Networks
• Darktrace
• Scadafence
• Forescout Technologies
• Rockwell Automation

Latest Developments

• In May 2024, Claroty announced the acquisition of CyberX, a provider of extended detection and response (XDR) solutions specifically designed for OT environments. This acquisition strengthens Claroty’s ability to deliver comprehensive security solutions that address the evolving threat landscape faced by critical infrastructure.
• In May 2024, AFWERX was awarded the operational technology (OT) and IoT security vendor a Small Business Innovation Research, or SBIR, Phase II contract to deploy its technologies. According to the business, Nozomi collaborated with the Air Force to build tools for OT and IoT asset visibility, threat detection, and data analysis to reduce cyber risk and increase resiliency.
• In September 2023, NIST published a guide to operational technology (OT) security. The impact of cyber security attacks on infrastructure control system owners/operators has never been greater or more evident.

Report Scope

Operational Technology (OT) Security Market, By Category

Solution

• Endpoint Security
• Security Information and Event Management (SIEM)
• Identity and Access Management (IAM)
• Incident Response

Service

• Consulting Services
• Managed Security Services
• Integration Services
• Training and Education
• Support and Maintenance

Deployment Mode

• On-Premises
• Cloud
• Hybrid

Region:

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East & Africa

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