IT Security Spending Growth at 15.2% CAGR Through 20010

IDC: IT spending for security within European financial institutions. New regulations, reputation issues, and the growing importance of direct channels and self-service banking make security one of the most important priorities for Western European financial institutions.

In particular, Financial institutions are under constant pressure because hackers' strategies evolve very rapidly and regulators constantly require stricter levels of control, which involve continuous upgrades of IT systems. Therefore, financial institutions that do not tackle security issues are expected to face huge tangible and intangible costs.

Priorities for security technology areas remain primarily within anti-virus software and firewall appliances, followed by Web filtering and intrusion detection solutions. Banks are also starting to invest in two-factor authentication technology, which is a combination of hardware and software solutions coupled with one-time passwords.

IT spending for security within European financial institutions is expected to grow faster than overall IT spending because of new regulations, the strong impact security has on brand and reputation issues, and the high impact security has on customers' perception. In more detail, IT spending for security within the Western European banking sector is expected to grow at a 15.2% CAGR over the next five years and is therefore an attractive segment for IT vendors to be positioned in.

In terms of volume, IT spending for security counts for about 2% of the IT spending of the Western European banking industry and reached $952 million in 2004.

, Western Europe Financial Services Sector IT Spending for Security 2005–2009 Forecast Publ 20040124