Cybersecurity Spending to Increase by 20% in 2021 Following SolarWinds Hack

A few weeks before the end of 2020, hackers breached software provider SolarWinds, directly infecting the company’s Orion software as well as several local, state and federal agencies in the United States. Private companies like Microsoft also got exposed to malware.

According to the research data analyzed and published by the Finnish website Sijoitusrahastot, hacking attempts like this will push companies to increase their cybersecurity spending by 20% in 2021.

From $40.8 billion in 2019, the total cybersecurity spending in 2020 is $43.1 billion. It is expected to reach $51.7 billion in 2021.

44% of Solarwinds Hack Victims Are IT Companies

Microsoft stated that at least 40 of its customers installed the trojanized version of the SolarWinds malware. 80% of the victims are from the United States while the rest are from the UK, Canada, Spain, Israel, Belgium, UAE and Mexico.

Based on the SEC documents submitted by SolarWinds, it verified that around 18,000 of its customers installed the trojanized updates from its software. This led to a massive search inside enterprise networks and continuous checks to ensure that second-stage malware payloads will be prevented.

Moreover, it has been reported that while there were several US government agencies that got hacked in 2020, the government sector constituted only a small part of the victim list. The IT sector is the one that got immensely affected by the hack. In fact, 44% of the hack victims are software firms, IT services and equipment providers.

With 18% each, both the government and NGO sector come after the IT sector. Government contractors got 9% while the remaining sectors have 11%.

Global Cybersecurity Market to Grow to $248.26 Billion by 2023

According to a study by Markets and Markets, from $152.71 billion in 2018, the global cybersecurity market is estimated to grow to $248.26 billion by 2023. This represents a compound annual growth rate (CAGR) of 10.6%.

Aside from malware, cybersecurity software also protects networks, hardware and information systems from other types of cyberattacks.

North America is forecast to hold the biggest market size because of the presence of many key players and tech companies in the region. At the second spot is Europe, followed by APAC.

There are multiple factors that drive the stunning growth of the cybersecurity market in the regions. These include the increased sophistication of cyberattacks, rapid economic development, rise of cloud-based solutions as well as the massive penetration of smartphones across the business and consumer segments.

Additionally, a Gartner report states that informational security spending alone reached $128.8 billion in 2020. Aside from the recent hacks, the coronavirus pandemic is also causing short-term demand in areas such as remote worker technology and cloud adoption. Security services got the highest spending, followed by infrastructure protection and network security equipment.