Unified threat management (UTM) continues to drive the security appliance market, according to research firm IDC. According to its Worldwide Quarterly Security Appliance Tracker, revenue grew 4.7% to $6.1 billion year-over-year in the fourth quarter of 2022, representing a $274 million increase compared to the same quarter in 2021.  The IDC Security Appliance Tracker also reports that the five leading vendors in the market account for nearly 60 percent of the revenue and all of the growth.

UTM refers to a  single point on the network that provides multiple security functions. For example, a UTM appliance may include a firewall, intrusion detection and prevention system, antivirus software, VPN, and other network security services. UTM appliances are especially attractive to smaller enterprises that benefit from the simplicity of having a single vendor and product for information security, according to IDC data.

The UTM market delivered year-over-year growth of 8.9%, according to IDC. The combined UTM and firewall markets accounted for 77.3% of the total revenue reported in the last quarter of calendar year 2022. In the same period, security appliance shipments grew by 21.7% year over year to more than 1.9 million units. IDC currently includes next-generation firewalls in this category.

"The hardware-based market is expected to continue playing a key role within holistic cybersecurity strategies,” said Carlo Dávila, research manager, Enterprise Security and Network Trackers at IDC, in statement released last Friday. Dávila added that as the supply chain improves, IDC expects the worldwide security appliances market to continue to grow in 2023

Palo Alto Networks tops the charts in terms fourth quarter 2022 revenue and market share with $973 million in revenue and a 15.9% market share, followed closely by Fortinet with $967 million in revenue and a 15. 8% market share. However, Fortinet showed much stronger year-over-year growth of 24.5 percent compared to Palo Alto Networks’ 10.2% growth.

Cisco showed modest growth of 4 percent but matches Palo Alto Networks and Fortinet for market share with 15.8%. Checkpoint and SonicWall round out the Top 5 security appliance vendors.

[caption id="attachment_127597" align="alignnone" width="624"] Top 5 security appliance companies’ revenue and market share. Source: IDC 2023[/caption]

The top five vendors represented more than 57 percent of the market. And while the top 5 all showed growth, the rest of the market declined by 2.4%, according to IDC. Dávila  said that IDC tracks 34 vendors in the security appliance category and those outside the top 5 some are growing and some are declining, and it varies quarter to quarters.

Led by the United States, the Americas delivered strong growth with a 10% year-over-year increase in the fourth quarter of 2022,. The Europe, Middle East & Africa (EMEA) region grew 4.8% -- driven by Western Europe, according to IDC.