The growth in BEC scams and spear phishing, the growing number of email users worldwide, the high demand for cloud-based email encryption services, and the requirement to comply with data protection requirements are all major driving factors for the industry.
The global email encryption market is expected to develop at a compound annual growth rate (CAGR) of 23.1 percent over the forecast period, from USD 3.4 billion in 2020 to USD 11.8 billion in 2026.
Email encryption encrypts data with the use of an encryption key, ensuring the security of information that must be conveyed by email. Sensitive information can be obtained by unidentified parties due to a rise in email usage for corporate as well as personal contact among individuals. This has prompted companies to use email encryption software to protect their data from theft and loss. Furthermore, these solutions aid in the prevention of cyber-threats and attacks such as spam, malware, viruses, Business Email Compromise (BEC) attacks, zero-hour malware, and other incursions that could put key company data and infrastructure at risk.
Market for Email Encryption
Impact of COVID-19 on the Email Encryption Market
The COVID-19 epidemic has had an impact on all aspects of society, including individuals and corporations. The internet ecosystem has become increasingly important around the world. The reliance on online enterprises has expanded dramatically as a result of the COVID-19 outbreak. The internet is being used by BFSI, healthcare and life sciences, manufacturing, automotive, retail, transportation and logistics, and other industries to provide critical services to consumers. The need for an email encryption system has fallen, according to vendors. Various governments and regulatory agencies have forced both public and private organisations to accept new techniques of teleworking and preserving social distance in the wake of the COVID-19 pandemic. Since then, digital business practises and the use of emails on home servers have become the new business continuity plan (BCP) for a variety of enterprises. Individuals are increasingly motivated to employ digital technologies such as email encryption, email security, and data loss prevention due to the extensive usage of mobile devices and internet penetration around the world (DLP). During the epidemic, the number of phishing and email scams has increased, and businesses have been more concerned about securing confidential data kept on email servers. Organizations can encrypt email data with email encryption solutions to protect their resources from dangerous cyber-attacks.
BEC frauds and spear-phishing are on the rise.
Over the years, sophisticated cyber-attacks such as email-based phishing and BEC schemes have wreaked havoc on businesses, resulting in large financial losses. In BEC, cybercriminals target business email accounts, impersonating customers, workers, or partners in order to obtain financial benefits such as approving payment transfers to the cybercriminals’ account. Spear phishing, which is used to steal data for nefarious purposes, is on the rise. Email encryption solutions and services are a good way to keep your email data safe. The use of spear-phishing to obtain sensitive information for nefarious purposes and the installation of malware on the device of a targeted user is on the rise. Hackers all across the world are preying on people’s anxieties about the COVID-19 pandemic, and there has been an uptick in COVID-19-related attacks, such as BECs and spear-phishing.
High cost of email encryption technologies is a constraint.
The high cost of establishing email encryption systems is the main barrier that businesses encounter when adopting these solutions. Organizations and users can utilise email encryption solutions to reduce the risk of data loss on email platforms. Because email encryption solutions necessitate the growth of IT resources for safeguarding and encrypting communications, their adoption dramatically raises enterprises’ overall overhead expenditures. The cost of the solution rises in proportion to the size of the encrypted file. The free platforms accessible on the internet lack the necessary features to effectively protect sensitive data. Due to budget constraints, email encryption solutions prove to be a costly solution for SMEs. Furthermore, the expenditures of maintenance and timely upgrades contribute to an organization’s total growth in expenses. The cost of software licence per user (email account), as well as the cost of email encryption software maintenance and technical assistance for users, is an expensive solution for low-budget businesses to implement. Furthermore, these encryption solutions must work with existing IT systems. As a result, all of these factors obstruct the adoption of email encryption software.
Demand for cloud-based email encryption services is expected to grow.
Enterprises are looking for cloud-based security solutions that will allow them to prevent advanced email threats while saving money, deploying quickly, and having on-demand access to experts. New and complex threats, such as spear phishing, trojans, ransomware, BEC scams, social engineering, malware, and spams, have emerged as a result of the rapid increase in IT infrastructure, putting businesses’ essential data at danger. In real-time, cloud-based email protection protects enterprises from phishing attempts, ransomware, spam, spoofing, and other dangerous threats via email. Many providers in the email encryption market provide clients with cloud-based email encryption services. Virtru, for example, provides a cloud-based and secure email encryption platform that ensures that all communications are encrypted from beginning to end. The demand for cloud-based email encryption solutions is growing as more apps become virtual.
Encrypting keys necessitates the use of key management and verification methods.
One of the primary issues in the email encryption business is the need for key management and verification solutions for encrypting keys. Encryption software is used to protect sensitive data, files, folders, and emails. Cryptographic keys are protected by encryption key management technologies. These cryptographic keys are passwords made up of a combination of alphabets and numbers. If encryption keys are compromised, current and historical content becomes vulnerable to hackers. So, with the help of specialists, these encryption keys must be safeguarded and maintained secretly so that they cannot be hacked by unknown individuals. Furthermore, email encryption keys are only useful if both parties have the encryption key software installed. In order to complete this procedure, recipients must install an email encryption solution, produce a pair of encryption keys, and provide the public component of those keys to senders. Only after entering the encryption keys can senders open emails. This constant provisioning, management, and production of encryption keys is time-consuming and limits email encryption usage.
The Banking, Financial Services, and Insurance (BFSI) industrial vertical has the greatest share of the email encryption market by vertical.
In the email encryption market, the BFSI industry vertical is predicted to have the largest share. Because it deals with enormous amounts of sensitive and private financial data, BFSI is the most targeted industry vertical. The email encryption solution is in high demand in this market vertical since it ensures irreversible encryption. Furthermore, the BFSI industry vertical is the most regulated, as it must adhere to numerous security regulations. Because of the sensitive and confidential data they handle, BFSI sectors have stringent data security regulations. Financial institutions are required to protect themselves from APTs, phishing, malware, and other advanced email attacks under various government mandates, including the Personal Information Protection and Electronic Documents Act (PIPEDA), Gramm-Leach-Bliley Act (GLBA), and the Federal Financial Institutions Examination Council (FFIEC), as well as standards such as PCI DSS and SOX.
Market for Email Encryption by Region
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During the projection period, North America is expected to have the greatest market size.
In the email encryption industry, North America is anticipated to have the largest market share. The region’s email encryption market is predicted to increase due to early adoption of email encryption and the existence of various providers offering email encryption solutions. Businesses in this region are increasingly using email encryption solutions to enable data protection, avoid cyber-attacks and commercial espionage, and provide data security and privacy to ensure business continuity.