Research consultancy Gartner is forecasting that worldwide security software revenue will exceed $16.5 billion in 2010, an increase of 11.3% from the $14.8 billion in revenue recorded in 2009.
During 2009, the security software business grew only 7%, which Gartner attributes to the global economic slowdown.
Gartner research analyst Ruggero Contu expects the security software market to continue to be one of the fastest growing segments of the enterprise software market, though with some variation between established and emerging technologies.
He anticipates that the security software market will weather the current economic challenges better than it did during the 2001-2002 period, thanks to greater product diversity and confidence in IT.
While software vendors may have more flexible business models and more varied revenue streams, they also face clients with dwindling discretionary budgets, a fact that will increase the competition for maintenance contracts and licensing fees.
Gartner expects the consumer security market to remain the dominant market segment, with $4.2 billion in projected revenue for 2010. The enterprise endpoint protection platform market should represent the second largest market segment, with projected revenue of about $3 billion this year.
With the projection of rising revenue comes a prediction that traditional software licensing models will be replaced by software-as-a-service deals and security appliances.
"During the next six to 12 months, products delivered as SaaS and appliances will continue overtaking traditional software licensing as the preferred purchasing methods," said Gartner research analyst Matthew Cheung in a statement.
Gartner expects compliance to continue to drive much of the market, particularly in segments such as user provisioning, security information and event management, and mobile data protection.