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Security Spending Shoots Up

The market for VPNs and firewalls is continuing to grow, according to the latest study from Infonetics Research Inc.

Hardware and software revenues in this area were up 11 percent from the last quarter of 2003, to reach $733 million in the first quarter of 2004. This figure is expected to grow to $823 million in the first quarter of next year.

These figures are hardly surprising given the constant security threats businesses face from hackers, worms, and viruses. The trend towards remote working has also helped develop the market for VPNs, which enable staff to access their companies' internal computing resources from remote locations.

The extensive product portfolio offered by Cisco Systems Inc. (Nasdaq: CSCO) has placed it in the driver's seat for VPN and firewall appliances.

Jeff Wilson, principal analyst at Infonetics, says, This is because they have products in lots of different form factors. They have a really broad range of network security products -- firewall appliances, routers with security, switches with security, intrusion and prevention systems.”

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