Since 2008, the total investment in global cyber-security deals has exceeded $22 billion, a PwC report found.
cyber-security spending is expected to reach $60 billion in 2011 and is
forecast to grow 10 percent every year during the next three to five years,
according to a report from PwC, "Cyber Security M&A: Decoding Deals in
the Global Cyber Security Industry." The United States accounts for more
than half of all deals globally that are triggered by growing cyber-threats and
increasing awareness among both organizations and consumers of accelerating
breaches and attacks, the report found.
deal activity since 2008 has exceeded $22 billion globally. In the first half
of 2011, there were 37 deals accounting for more than $10 billion in value,
representing a 70 percent increase compared with full-year 2010. Since
2008, the total investment in global cyber-security deals has exceeded $22
billion, an average of more than $6 billion each year.
activity in cyber-security is expected to continue to grow given the
fragmentation of the market and the attractive growth outlook," said Barry
Jaber, PwC's security industry leader. "Technology and IT companies are making
acquisitions to differentiate their offerings, while defense firms continue to
do deals to diversify away from shrinking defense budgets."
most regions, the private sector accounts for the majority of cyber-security
spending. The United States is the notable exception, where government spending
is almost equal to the private sector. The strong U.S. technology industry
combined with the fact that the U.S. defense and intelligence budgets are
significantly larger than in any other country are key market drivers.
the backdrop of heightened awareness of hacks and deliberate attacks on
institutions by semi-organized groups, the cyber-security market is undergoing
significant change and attracting investment from sectors that span technology,
telecommunications, defense, professional services and financial investors,"
said Rob Fisher, PwC's U.S. technology leader for transaction services.
U.S. market leads in value, with the majority of deals (over 50 percent)
involving acquirers or targets based in North America. By comparison,
Europe accounted for approximately a quarter of deal value and a third of deal
volume over the same period.
U.S. is a unique market with significant cyber-security spending in the public
sector, particularly by intelligence and defense agencies," said Jaber.
"Growing threats and awareness, and changes in technology such as mobile
devices and cloud computing are key drivers of spending growth in the cyber-security
key drivers underpinning growth in cyber-security spending include increasing
cyber-threats, both from new actors and new threat vectors (the paths that
attacks can take); greater vulnerabilities due to the more pervasive use of
technology, particularly mobile devices and cloud computing; increasing
awareness by organizations and consumers of the threats and potential threats;
changes in technology driving product and service innovation of security
solutions; and increasing regulation, particularly those enforcing the
requirement to secure personal data.