By 2026, the 23 billion Internet of Things connections will present new threat vectors and generate US$16 billion in IoT security revenues, according to new research from ABI Research.
There are currently 8.6 billion IoT connections. By 2026, that number will nearly triple to 23.6 billion. In its new whitepaper, Connected - Protected: The Vulnerabilities and Opportunities of IoT Security, global tech market advisory firm ABI Research explores how the exponential growth in IoT connections will usher in a new era of connectivity and productivity along with a slew of new threat vectors and vulnerabilities. At the same time, the looming security gaps offer a tremendous revenue potential for players in IoT security.
"Concerns about security of the Internet of Things (IoT) are widespread," says Michela Menting, digital security research director at ABI Research.
"Security gaps run the gamut from devices that are incapable of being secured to Original Equipment Manufacturers (OEMs) and vendors often choosing to accept the risk rather than remediate it, as well as functional safety-type IoT devices that prioritise availability and cannot simultaneously ensure confidentiality," she says.
"There are limited IoT security solutions in the market, due in large part to the fragmented nature of the IoT itself."
While these security gaps pose a significant challenge for companies and end-users, they also represent a tremendous opportunity for players in the IoT space, including IoT service providers, vendors, platform operators, and Information Technology (IT)/Operational Technology (OT) security organisations, the research says.
Much like the number of IoT connections is set to explode, so too is the revenue opportunity in IoT security. ABI Research market data shows that total revenue in the space will reach US$16.8 billion by 2026.
The sheer number of new IoT connections over the next 5 years, the increased digitisation capabilities of certain IoT markets (e.g., utilities, industrial, infrastructure, and smart cities), the increase in connected users and assets along with the increased connectivity needs brought forth by the COVID-19 pandemic are all fair predictors for digital security overall.
"The amount of IoT security revenue, however, does not always correlate with the amount of IoT connections, and some markets are expected to experience disproportional revenue," says Menting.
"This is due to the multi-faceted level of security and management requirements that provide the foundation for other key operations and valuable services, including for intelligence operations and analytics, life cycle management and predictive maintenance, firmware updates, and device and data integrity," she says.
"ABI Research forecasts that digital security services will enter the Return on Investment (ROI) equation significantly faster in the next three years, as both security vendors and IoT players will better understand how to protect the key monetisation applications related to their IoT strategies."