Cisco continues to lead slowing security market

Share slips from last year due to revenue decline

Cisco continued to lead the security appliance market in the third quarter of 2012 but its revenue slipped as the market slowed. Cisco's Q3 revenue was $326 million, good for 16.2% of the $2 billion market; but it was down 1.5% from 2011's third quarter, when Cisco's leadership share was 17.3%.

And even though security appliance revenue and unit share grew in Q3, it slowed markedly from the second quarter: revenue rose 5.7% in Q3, down a bit from the 6.6% rise in Q2, 2012; and unit shipments inched up only 1% to 499,022 units, compared to almost 6% year-over-year growth in Q2.

Unified Threat Management saw the largest year-over-year revenue growth at 24.3% and accounted for 33.3% of security appliance revenues in Q3, according to IDC. These multi-function appliances continue to drive growth in the overall market.

The Firewall/VPN market represented 26.7% of security appliance revenue and saw 7.3% year-over-year growth. The IPS and VPN segments were the only markets to show revenue declines over the past year, the firm notes.

The U.S. posted 4.6% revenue growth on a unit decrease of 1.2%. The region saw growth driven by larger enterprises and service providers, while lower priced appliances experienced softness, according to IDC.

Western Europe, which accounts for much of the macroeconomic malaise due to its debt crisis, saw security appliance revenue grow just .5% in Q3.

The combined shares of the top five global security appliance vendors represented 48.5% of the market in the third quarter.  After Cisco, they include: Check Point, with 12.8% share, up from 12% a year ago;  Juniper, with 7.9% share, down from 9% a year ago; Fortinet, with 5.9% share, up from 5.4% a year ago; and McAfee, with a 5.7% share, flat with a year ago.

In the "other" category - 51.5% of the overall market -- Palo Alto Networks and Sourcefire saw particularly strong results in the third quarter, according to IDC.

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