OPERATIONAL TECHNOLOGY SECURITY MARKET ANALYSIS

Market Size and Trends

The operational technology security market is estimated to be valued at US$ 20.18 billion in 2024 and is expected to reach US$ 57.51 billion by 2031, exhibiting a compound annual growth rate (CAGR) of 16.1% from 2024 to 2031.

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The growth of the operational technology security market can be attributed to the increasing threat of cyberattacks on industrial control systems. With more industrial equipment and manufacturing systems being connected to the internet through IoT, the risk of exploits has risen dramatically. As operational networks and enterprise networks converge, both government and commercial organizations are recognizing the need for stronger security solutions to protect critical infrastructure from threats. The implementation of best practices such as secure authentication, network segmentation, malware protection, and endpoint detection on industrial control systems is expected to drive the demand for operational technology security solutions over the coming years.

Growing Connectivity in Operational Technology Environments

As operational technology networks continue to become increasingly connected to enterprise IT infrastructures and public networks like the internet, they have grown more vulnerable to cyberattacks. The traditional air gaps that once separated these systems are disappearing as organizations look to leverage connectivity and data insights across departments. But bringing OT online also exposes critical infrastructure systems controlling everything from energy generation to water treatment to new threat vectors. Recent incidents involving ransomware like the attack on Colonial Pipeline have underscored the risks of unsecured OT environments. Regulators and asset owners alike are recognizing that strong security is imperative for these networked control systems that underpin essential public services and national infrastructure. The demand is therefore growing for solutions that can help OT stakeholders implement proper governance, segmentation, access control, and monitoring of their operational networks. Vendors offering industrial cybersecurity technology and services are well positioned to benefit from this driver.

For instance, in May 2021, Forcepoint completed the acquisition of Cyberinc, an IT services and consulting firm headquartered in the U.S. Forcepoint's portfolio includes advanced remote browser isolation (RBI) technology, providing administrators with precise control. Additionally, its Smart Isolation capabilities aim to boost user productivity, reduce operational complexities, and replace traditional monolithic products with a leading SASE cloud service.

Market Concentration and Competitive Landscape

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Transition to IoT and Cloud Adoption

There is a major ongoing transition happening in OT where legacy systems are being upgraded to connect with modern smart technologies and integrated cloud platforms. The adoption of industrial internet of things (IIoT) solutions and other advancements like AI often comes with connecting previously air-gapped equipment to new networks. This brings the promise of data-driven optimization and remote management capabilities. However, it also expands the attack surface and introduces new security complexities for asset owners as IT and OT converge. As more industrial assets and processes become software-defined, there is a clear need to ensure these modernized systems have security baked into their design. This significant technology transition opens up an expanded market for OT security offerings that facilitate secure connectivity, identity and access management, anomaly detection, and forensic analysis in hybrid cloud and IIoT environments. Leading security providers are aligning their product roadmaps to address the security challenges of industrial modernization initiatives involving cloud platforms and smart networked devices.

For instance, in May 2022, UST, a prominent provider of digital transformation solutions, disclosed an original equipment manufacturer (OEM) agreement with SAP. This agreement enables UST to incorporate SAP Business Technology Platform (SAP BTP) into its Cogniphi AI Vision platform, rebranded as UST Sentry Vision AI. This service utilizes advanced video analytics to integrate predictive, contextual, and analytical functionalities into retail and manufacturing operations. Offered as a SaaS-based packaged solution, it seamlessly integrates with SAP S/4HANA and RISE with SAP.

Key Takeaways of Analyst:

The operational technology security market is poised to grow significantly in the coming years. Major drivers for this growth include the increased interconnectivity of OT systems with other networks which has expanded the attack surface. As more OT devices join internet of things networks, the risk of cyberattacks will rise. There is also a growing need to monitor OT networks for vulnerabilities and threats in real-time as disruptions can have serious safety and economic consequences.

North America currently dominates the OT security market due to growing investments by critical manufacturing industries to secure their production assets and supply chains. The region is an early adopter of cybersecurity technologies. However, Asia Pacific is expected to rise as the fastest growing region with nations like China and India rapidly industrializing. Countries are implementing initiatives to strengthen the security of critical infrastructure.

While demand for OT security solutions is growing, limited awareness of threats among asset owners remains a restraint. There is also a skills shortage of professionals experienced in securing industrial control systems. Integration of security tools with legacy systems can also pose technical challenges.

The market presents opportunities for providers to offer unified platforms that span both IT and OT networks. As attacks grow more sophisticated, demand will rise for highly tailored solution catered for specific industrial sectors and protocols.

Market Challenges: Heterogeneous Nature of Operational Systems

One key challenge in the operational technology security market stems from the diverse and fragmented nature of operational systems. Unlike IT networks which often follow standardized protocols, operational technology environments consist of varied devices from different vendors. This diversity complicates efforts to implement uniform security measures and achieve comprehensive visibility across systems, posing significant hurdles for security practitioners.

Market Opportunities: Increasing Awareness of Operational Security Importance

As industries recognize the crucial significance of securing previously neglected operational areas, there arises an opportunity for heightened investments in security measures. This shift in awareness opens doors for vendors to offer specialized solutions tailored to address the unique security challenges within operational technology environments, thereby stimulating the market growth.

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In terms of component, services segment dominates the market owing to reliability and cost-effectiveness

In terms of component, services is expected to contribute the highest share of 63.8% in 2024. The services segment contributes the highest share of the operational technology security market due to organizations' growing reliance on expert guidance and custom solutions. As operational networks become increasingly complex and interconnected, maintaining security requires deep technical skills that many in-house teams lack the resources to develop. Outsourcing to managed security service providers allows companies to tap into specialized knowledge without substantial upfront investment. These experienced partners can also provide around-the-clock monitoring and rapid response in the event of threats, freeing internal IT staff for other priorities.

Custom deployments are also crucial given the unique infrastructure of each industry. Off-the-shelf security products often do not account for proprietary protocols or legacy systems still critical to operations. Service providers understand these unique requirements through assessments of existing environments and architectures. Their custom solutions are tailored to address industry-specific vulnerabilities and integration challenges. This focused approach delivers stronger protection that precisely fits each organization's needs.

Another driver is the demand for managed detection and response. As attackers employ ever more sophisticated tactics, merely deploying security controls is no longer sufficient - those defenses must be actively managed. Services allow OT teams to stay focused on their core functions while security experts handle continuous monitoring, analysis, and coordinated incident response. This managed approach to security operations yields clearer visibility and faster remediation compared to limited in-house resources.

As operational complexity rises and threats evolve rapidly, relying on dedicated security expertise through comprehensive services becomes increasingly critical. Their specialized knowledge, custom solutions, and managed operations empower organizations to protect increasingly vast and interconnected operational technologies.

In terms of industry, energy & utilities segment dominates the market owing to reliability and cost-effectiveness

In terms of industry, energy & utilities is expected to contribute the highest share of 40.9% in 2024. The highest share of demand within the operational technology security market largely due to compliance requirements and exposure to disruptive risks. As operators of national critical infrastructure, utilities face stringent regulations regarding control systems security from bodies like NERC CIP. Failure to demonstrate robust protections or respond appropriately to incidents can result in steep fines and loss of operating licenses. Compliance therefore represents an imperative, driving heavy investment in monitoring, access controls, and secure infrastructure design.

The sector also manages extensive interconnected grids and pipelines exposed to growing cyber and physical threats. A successful attack could trigger equipment damage, power or water loss for large populations, and safety issues. Ransomware specifically endangers control systems supporting distribution. Given their impact, even momentary disruptions can quickly cost millions and severely damage public confidence. OT security adoption increasingly becomes not just mandatory but a necessity to manage these risks proactively rather than react to harmful incidents.

Additionally, energy transitions toward renewable sources like solar and wind introduce expanded industrial internet-of-things deployments into generation and distribution. This rising operational complexity multiplies existing vulnerabilities, requiring modern solutions to segment, authenticate, and govern all newly networked equipment and data flows. Compliance pressures and risks thus drive utilities to invest comprehensively in innovative protection suited for their uniquely important yet threatened infrastructures.

Regional Insights

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North America remains the dominant region in the global operational technology security market. The region is expected to account for a market share of 38.2% in 2024. This is due to a strong industrial presence and growing importance given to cybersecurity across critical infrastructure sectors like oil & gas, utilities and manufacturing. With heavy investments being made to modernize aging operational plants, the adoption of advanced OT security solutions is rising rapidly in countries like the U.S. and Canada.

Stringent regulations regarding process safety and cyber incident reporting for industrial control systems have pushed organizations in North America to strengthen their security posture. Several high-profile cyberattacks on infrastructure facilities in recent years have also heightened awareness about vulnerabilities in OT environments. Leading manufacturing companies are proactively deploying network segmentation, device authentication, and anomaly detection tools to reduce cyber risks. Going forward, the demand for solutions ensuring compliance with directives like NERC CIP is expected to surge.

Among emerging markets, Asia Pacific has the fastest growth with a CAGR of 18.2% for the forecast period of 2024-2031. Countries, such as China, India, Japan, and South Korea, house a significant proportion of global manufacturing might and feature highly digitalized operations. However, cybersecurity spends in these nations have traditionally focused more on IT rather than integrating production networks. With Industry 4.0 trends gaining steam and critical assets interconnected, the need for holistic security spanning information and operational domains is rising in Asia Pacific.

Government initiatives to foster smart infrastructure and push Industry 4.0 standards present opportunities for OT security vendors. Rapid industrialization also brings challenges of operationalizing legacy control systems and integrating them with new technologies securely. This is driving the uptake of converged solutions capable of delivering universal visibility and consistent protection. As process automation grows more complex due to influx of data from IoT devices and use of cloud/edge computing, the demand for adaptive security offerings will increase substantially.

Market Report Scope

Key Developments

• In May 2022, Accenture and SAP collaborated on a new service aimed at assisting major organizations in migrating to the cloud and fostering continuous innovation. This joint offering combines SAP's RISE solution with Accenture's SOAR services, augmented with new features including Accenture's suite of transformation services and intelligent tools, delivered through a unified as-a-service model.
• In the same month, Mobileum Inc. and Digis Squared formed a strategic partnership to offer a comprehensive suite of network testing and cognitive optimization solutions. This collaboration combines Digis Squared's expertise in cognitive tools for network optimization with Mobileum's scalable telecom analytics portfolio, enabling operators to enhance business performance, monitor customer experience, and explore new monetization opportunities.
• In April 2022, Quinnox entered a Partner Connect agreement with Software AG, enriching Quinnox's efforts to develop impactful go-to-market strategies, products, and services. Leveraging Software AG's tools, training, and technologies, Quinnox aims to capitalize on market opportunities and deliver enhanced solutions to customers.
• In January 2021, Francisco Partners acquired Forcepoint, a leading provider of cybersecurity solutions, thus strengthening its portfolio in partnering with technology-driven businesses

*Definition: The operational technology security market involves securing industrial control systems, manufacturing execution systems, distributed control systems, and other systems that monitor and control equipment, assets, and processes. It protects these systems from cyber threats and vulnerabilities to ensure safety and reliability of industrial operations. It involves securing programmable logic controllers, human-machine interfaces, engineering workstations, network infrastructure, and other hardware and software components used in industrial environments like manufacturing plants, power generation facilities, oil and gas installations, and others.

Market Segmentation

• Component Insights (Revenue, US$ Bn, 2019 - 2031)
  • Solution
  • Services
•  Industry Insights (Revenue, US$ Bn, 2019 - 2031)
  • Manufacturing
  • Transportation & Logistics
  • Energy & Utilities
  • Oil & Gas Operations
  • Government
  • Healthcare & Pharmaceuticals
  • Others
• Regional Insights (Revenue, US$ Bn, 2019 - 2031)
  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Argentina
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • Spain
    • France
    • Italy
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Australia
    • South Korea
    • ASEAN
    • Rest of Asia Pacific
  • Middle East & Africa
    • South Africa
    • GCC Countries
    • Israel
    • Rest of Middle East & Africa
• Key Players Insights
  • ABB Ltd.
  • Belden Inc.
  • Check Point Software Technologies Ltd.
  • Cisco Systems, Inc.
  • Claroty Ltd.
  • CyberX (acquired by Microsoft)
  • Dragos Inc.
  • FireEye, Inc.
  • Fortinet, Inc.
  • General Electric Company
  • Honeywell International Inc.
  • IBM Corporation
  • McAfee, LLC
  • Nozomi Networks Inc.
  • Palo Alto Networks, Inc.
  • Rockwell Automation, Inc.
  • Schneider Electric SE
  • Siemens AG
  • Symantec Corporation
  • Tenable, Inc.