With the continuing expansion of network connectivity through mobile devices, cloud data centers and internet of things, the cases of data breach and confidential information leakage have gone to its peak. This has resulted to increasing threats of cyber-attacks and fiber cable intrusion. Owing to the growing requirement of cyber security among the enterprises to control the effects of cyber-attacks, the demand for optical encryption is estimated to increase. According to the UK government, over four in ten of all UK businesses suffers at least one breach or cyberattack in 12 months. Additionally, the market growth is attributed to the ability of optical encryption in protecting in-flight data and guarding against network intrusions. These factors are anticipated to significantly expand the optical encryption market.
There is a global ever-increasing penetration of cloud services and data centers deployment in recent years. Optical encryption provides first-level and simple-to-implement defense for communications between data centers as well as simplifies the network architecture. Furthermore, rapidly increasing volumes of data have led organizations to follow various data security laws and regulatory compliance which are expected to fuel the market growth. On the back of these, the optical encryption market is predicted to grow over the forecast period. CLICK TO DOWNLOAD SAMPLE REPORT
Emerging need of regulatory compliances, growing concern over privacy of data and rising incidents of cyber frauds, as well as high data center deployments are some of the significant factors boosting the market growth. The optical encryption market is anticipated to record a significant CAGR over the forecast period, i.e., 2020-2028. The market is segmented by encryption layer into OTN/layer 1, MACsec/layer 2, and IPsec/layer 3. Among these segments, the segment for IPsec/layer 3 is anticipated to hold the leading share in the market on account of large-scale IPsec/layer 3 utilization in enterprises, internet-based virtual private networks and government networks. Further, it offers seamless security to application, transport layers and networks of all sizes.
Despite the advancement in-flight data encryption solutions, there is a possibility of unstable network infrastructure and limited network-oriented approach. Also, there is incremented complexity associated with managing the network. This is estimated to hinder the growth of optical encryption market in the future.
Our in-depth analysis of the optical encryption market includes the following segments:
On the basis of regional analysis, the optical encryption market is segmented into five major regions including North America, Europe, Asia Pacific, Latin America and Middle East & Africa region.
The market for optical encryption in North America is anticipated to hold the largest share in the market on account of presence of leading market players in the region which provides and market optical encryption. Moreover, increase in global threat of cyber-attacks owing to huge adoption of cloud-based applications by network operators in this region further promotes optical encryption. The market in Asia Pacific region is predicted to grow at the highest rate during the forecast period on account of optical transport network data encryption capabilities in countries such as China, South Korea and India along with the increase in usage of smartphones, laptops, televisions, and several other data generating devices.
The optical encryption market is further classified on the basis of region as follows:
In 2023, market players might incur losses due to huge gap in currency translation followed by contracting revenues, shrinking profit margins & cost pressure on logistics and supply chain.
Controlling Inflation has become the first priority for global economies from last quarter of 2022 and to be followed in 2023. With skewed economic situations, rise in interest rate by governments to control spending and inflation, spiked oil and gas prices, high inflation, geo-political issues including U.S. & China trade war, Russia-Ukraine conflict to intensify the global economic issues.
The interest rates in the U.S. may be less sensitive in 2023 as compared to 2022; sigh of relief for businesses. Positive business sentiments, healthy business balance sheets, growth in construction spending (private construction value in 2022 stood at $1,429.2 billion, 11.7 percent (±1.0 percent) above the $1,279.5 billion spent in 2021, Residential construction in 2022 was $899.1 billion, up by 13.3 percent (±2.1 percent) from $793.7 billion in 2021, non-residential construction touched $530.1 billion, 9.1 percent (±1.0 percent) above the $485.8 billion in 2021.) showcases minimal impact of recession in the country.
Similarly, spiked spending in the European and major Asia economics including, India, China & Japan to showcase less impact on the global demand.