Embedded security is a strategic approach to protecting software running in embedded systems from attack. Embedded security for devices and networks that are connected through internet of things is provided with the help of hardware and software such as controller chip and others. Embedded security for IoT finds applications in smart grid, smart factory, networking equipment, connected car, and computing devices. Embedded security systems are designed to perform certain functions. Growing cyber-attacks around the world on IoT devices is one of the major reasons embedded security systems have been widely implemented.
The global embedded security for internet of things (IoT) market was estimated to account for US$ 3,225.5 Mn in 2018 and is expected to grow at a CAGR of 14.6% during the forecasted period (2019-2027)
Market Dynamics- Drivers
- The increasing number of connected devices via IoT networks are expected to drive the growth of the global embedded security for internet of things (IoT) market during the forecast period
The growing adoption of IoT worldwide has increased the number of devices being connected, communicating, and exchanging data with each other. These devices connected through IoT networks are used in several industry verticals including healthcare, retail, smart cities, industrial automation, agriculture, etc. According to Cisco Systems, Inc., a U.S.-based IoT solutions provider, around 7% of global mobile traffic data is expected to come from devices connected through IoT by 2020, which is up from 3% in 2015. Thus, rising number of connected devices through IoT networks are expected to boost the market growth during the forecast period.
- Implementation of industry guidelines to adopt embedded hardware solutions is expected to propel the global embedded security for internet of things (IoT) market during the forecast period
Since the cyber-attacks have been increased in the recent past significantly, numerous organizations that support the best practices for employing IoT solutions have issued guidelines for implementation and adoption of essential security solutions. Deploying embedded chipsets and embedded software is one such guideline to promote adoption of embedded security systems for IoT. For instance, in December 2016, Smart Card Alliance, a not–for-profit multi-industry association promoting best practices for smart card application in the U.S. and Latin America, released guidelines for adoption of embedded hardware security solutions concerning end devices, in order to involve hardware functions and features to make sure that the required security standards are employed and maintained.
North America region dominated the global embedded security for internet of things (IoT) market in 2018, accounting for 30.7% share in terms of value, followed by Europe, and Asia Pacific, respectively.
Source: Coherent Market Insights
Market Dynamics- Restraints
- Providing enhanced embedded security systems to growing IoT devices are expected to restrain the global embedded security for internet of things (IoT) market growth over the forecast period
Increasing number of connected IoT devices has increased the volume of data exchanged through these devices. Proving enhanced embedded security such large traffic of data without hampering the quality is a challenging task for service providers. Moreover, providing enhanced embedded security solutions to household devices connected through vast communications networks to industrial automation networks is a daunting task, which in turn, is expected to hinder the market growth over the forecast period.
- Non-compliance to guidelines offered by regulatory authorities is expected hider the global embedded security for internet of things (IoT) market growth during the forecast period
Despite governing authorities issuing guidelines concerning IoT devices and their protection against cyber-attacks, many organizations and users are not stringently following these guidelines and taking precautionary measures. Such non-compliance to these guidelines results in security lapses, eventually leading to cyber-attacks. This, in turn, is expected to hamper the market growth over the forecast period.
- Lack high computational power availability for IoT networks is expected to pose lucrative growth opportunities for market players
Network security applications are high power consuming in nature and if lower power embedded hardware is used, it put overall system at risk. Moreover, IoT networks’ processing capability is limited in terms of processing security applications algorithms. These drawbacks in existing embedded hardware solutions offer lucrative growth opportunities for chipset makers to provide enhanced embedded solutions with features such as high processing capabilities and power. For instance, in April 2016, Intel Corporation launched Xeon CPUs packaged with FPGA (field-programmable gate array) chips. It allowed to alter computational powers for specific applications and workloads. These chips can be used for providing IoT devices with high processing capability.
- Unavailability set-up mechanisms to update connected IoT devices is expected to offer significant growth opportunities for key players
IoT devices require constant upgrade, in order to protect against prevalent cyber-attacks and malware. However, such upgrades require support infrastructure from companies and technical expertise. Moreover, installing updated embedded chipsets reduce the need for updating these devices on regular basis, which in turn, is expected to provide excellent growth opportunity for embedded hardware solutions providers to endorse their products for IoT security.
Source: Coherent Market Insights
In global embedded security for internet of things (IoT) market, by application segment connected car sub-segment dominated the global embedded security for internet of things (IoT) market in 2018, accounting for 28.0% share in terms of value, followed by smart factory, smart grid, networking equipment and computing devices sub-segment, respectively.
- Growing focus on component aspect of security is expected to be the major trend in the market
Software security solutions alone cannot prevent IoT devices against cyber-attacks and malwares. Thus, it needs to be supported by reliable hardware and for data processing and safe storage. Moreover, hardware components that susceptible to cyber-attacks provide an opportunity for unauthorized access and data theft, which is why, OEMs are shifting focus towards embedded component suppliers who can address these security issues. For instance, in July 2015, security researchers showed how they can hack and disable brakes and manipulate systems of Jeep Grand Cherokee which is a mid-sized SUV from Fiat Chrysler Automobiles N.V., resulting in recall of around 1.4 Mn vehicles.
- Growing adoption of Industry 4.0 applications enabled by IoT, in order to become smart factory
‘Industry 4.0’ is a novel concept in the manufacturing industry where companies are adopting intelligent network, connected machines, systems, etc. in order to become smart factories. This will allow them to automatically monitor, exchange information, and instigate actions independently. Growing adoption of Industry 4.0 applications is expected to accelerate demand for embedded security solutions in the near
Value Chain Analysis
Key players operating in the global embedded security for internet of things (IoT) market are Intel Corporation, Trend Micro Incorporated, Cisco System Inc., Inside Secure, NXP Semiconductors N.V., Synopsys, Inc., Infineon Technologies AG, ARM Holdings Plc. (SoftBank Corp), Gemalto NV, Palo Alto Networks Inc., and Check Point Software Technologies Ltd.
- Key players in the market are focused on partnerships and collaborations, in order to gain competitive edge in the market. For instance, in March 2017, Intel Corporation partnered with Microcmax, an India-based consumer electronics supplier, in order to provide McAfee Security software pre-installed with Micomax’s tablets and smartphones.
- Key companies in the market are focused on partnerships and collaborations, in order to enhance their market presence. For instance, in January 2017, Cisco System Inc. partnered with Ericson Inc. to launch new Wi-Fi solution — Evolved Wi-Fi Networks (EWN).