Firewall/VPN market takes a dip

While IPSec VPNs have pretty clearly won a permanent place in corporate networks and corporate security, they are also subject to the ups and downs of the marketplace. According to the latest figures from Infonetics, the firewall/VPN market worldwide took a dip in the first quarter of this year, down 4% from the quarter before, to $700 million.

That’s still a big number and not a huge dip. The author of the report, Jeff Wilson, executive director of Infonetics, says that can be explained by several factors.

First, a lot of people buy gear in the fourth quarter, at the end of their fiscal years, bumping sales numbers up. Truth be told, vendors probably let some sales figures slop over into the fourth quarter to show strong year-end numbers as well.

Global political turmoil and economic worries also play a part, making businesses more cautious about spending. Since IPSec VPNs fall into the category of security, you would expect a smaller dip here than in other network purchasing.

And Wilson even cites the virus SARS as a possible factor in limiting sales, perhaps because of restricted travel that might have sealed deals.

Whatever the reason, Wilson says the dip is not the start of a downward trend. He expects sales to be up in the second quarter when those numbers come in later this year. Longer term, he expects total sales for this year to be $3 billion, and that the number will grow to $4.7 billion by the end of 2006.

Perhaps this dip shows that IPSec is a mature technology. If it were still in the boom growth phase, sales figures likely wouldn’t experience such quarter-to-quarter blips.