In recent years, under the background of significant changes in the domestic and foreign environment, as the infrastructure of national economic development, a new generation of information technology is leading many industries to achieve transformation and upgrading. On April 7, iResearch released the "China Cyber Security Hardware Platform Industry Research Report" (hereinafter referred to as the "Report"), which systematically expounded the application scenarios, development history, market size and market share of the network security hardware platform industry, and looked forward to the future trend of the industry.
The so-called network security hardware platform refers to the professional equipment that protects network security and is the hardware carrier of network security solutions. Different from general-purpose computing hardware devices (such as servers), network security hardware platforms have the characteristics of high stability, high reliability, and deep customization in various environments. The procurement of network security hardware platforms is the focus of network security software vendors, and it is reported that it accounts for about 20% of the cost and profit structure of network security vendors.
The report shows that the network security hardware platform industry and the network security industry appeared at the same time, and after more than 20 years of development, the competitive landscape has completed two rounds of iteration. In the early stage of the development of the network security hardware platform industry, the industry was represented by Taiwan-funded manufacturers and occupied a dominant position in the market. Since then, domestic manufacturers have tried to layout one after another, but in the early competition, most of them have withdrawn from the field; but there are still a small number of domestic manufacturers who continue to cultivate deeply, and finally rely on technical capabilities and management capabilities to form differentiated advantages, surpassing Taiwan-funded manufacturers in the current industry competition and occupying a leading position in the industry.
In terms of market size, the overall development of the network security hardware platform industry is stable. Among them, the traditional network security hardware platform market has grown steadily, reaching 6.82 billion in 2021; Although the domestic network security hardware platform market is small, it is about to enter a period of rapid development, with an average market growth rate of more than 100% in the next 5 years.
Talking about the factors driving the rapid growth of the market, iResearch analyst Mu Chunyang believes that policy guidance, the improvement of domestic demand of enterprises, and the acceleration of the localization process are the main positive factors for the growth of the industry. Product development and design, supply chain management capabilities, and localization adaptation capabilities are the key factors in judging the capabilities of manufacturers.
From a macro point of view, it began to become an important issue in the industry in 2016 and began to accelerate development in 2019. Thanks to the improvement of the independent innovation ability of Chinese enterprises, traditional industries have successively introduced domestic IT technology, and localization IT products have ushered in a period of accelerated expansion, gradually penetrating more widely in key industries. The wide application of domestic IT products in the digitization of traditional industries has also led to the increase in demand for network security hardware products that can adapt to the needs of localization functions.
From the perspective of the overall network security hardware platform pattern, Taiwan manufacturers still occupy the dominant position of traditional network security, and mainland manufacturers are gradually surpassing and are in a leading position in the market. From the perspective of market pattern, the current overall network security hardware platform industry pattern in China is relatively scattered, Taiwanese manufacturers still occupy a major position, and only One domestic manufacturer is Leyan Technology, ranking first in market share. The domestic network security hardware platform market is highly concentrated, of which a single manufacturer of Leyan Technology occupies nearly 50% of the market share.
"Downstream customers strictly review the localization of network security hardware platforms, requiring product quality and product capabilities to meet higher standards." The number of platform vendors that can provide a platform that meets the needs is very limited, and the user procurement is mainly based on high-end products, making it difficult for long-tail manufacturers in the field of traditional network security hardware platforms to cross-border into this field. Mu Chunyang said.
The reporter learned that Leyan Technology is the first batch of "specialized and new" small and medium-sized enterprises in Beijing in 2022, and its main customers include Qianxin, Tianrongxin, NSFOCUS Technology, Venustech, Liufangyun, etc.
"In the context of the escalation of global cyber attacks and the domestic adoption of cyber security as a national strategy, the security awareness of Chinese enterprise customers is constantly improving, the demand for security products is rising, and expanding network security spending will drive the expansion of demand for network security hardware platforms." Mu Chunyang said that the deepening trend of localization will transform the focus of competition in the industry and bring more potential opportunities for domestic manufacturers. At the same time, with the acceleration of the development of the industry, the industry self-regulatory organization will be formed faster, promoting the industry to standardize and standardize. "The leading domestic network security hardware platform manufacturers should seize the industry trend, accelerate the capitalization process, build a moat in the field of technical capabilities and resource management, and shape lasting competitiveness."
Image source: iResearch