EMBEDDED SECURITY FOR INTERNET OF THINGS (IOT) MARKET ANALYSIS

Global Embedded Security for Internet of Things (IoT) Market is estimated to be valued at US$ 15.21 Bn by 2030.

The strategic approach of embedded security aims to safeguard software operating in embedded systems against attacks. In the context of the Internet of Things (IoT), embedded security plays a crucial role in protecting various applications like smart grids, smart factories, networking equipment, connected cars, and computing devices. The growth of the global embedded security for Internet of things (IoT) market is driven by several factors. These include the adoption of embedded hardware solutions based on industry guidelines, the increasing number of connected devices through IoT networks, the integration of embedded security in electric vehicles, the demand for comprehensive security solutions for IoT, the need for additional security for legacy systems due to the growing internet penetration rate, and government agencies promoting digitization.

Embedded security for IoT encompasses a range of technologies, protocols, and techniques that are employed to ensure the confidentiality, integrity, and availability of data transmitted or processed by embedded devices connected to the IoT network. Its main objective is to implement security measures within the hardware and software components of these devices, effectively mitigating potential threats such as unauthorized access, data breaches, and malware attacks. To achieve this, embedded security for IoT incorporates features like secure boot, secure firmware updates, secure communication protocols, encryption, and other measures to guarantee the security of both the devices themselves and the data they handle.

Global Embedded Security for Internet of Things (IoT) Market: Regional Insights

In 2022, The Asia Pacific region is anticipated to emerge as the primary market for embedded security. This can be attributed to the rising usage of embedded security devices in wearable technology and automobiles that are being produced in the region. The growth in demand is driven by escalating concerns about Cybersecurity in several emerging economies within the region, including India, China, Singapore, and Japan.

Figure 1: Global Embedded Security for Internet of Things (IoT) Market Share (%), By Region, 2022

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Global Embedded Security for Internet of Things (IoT) Market - Impact of Coronavirus (Covid-19) Pandemic

The COVID-19 pandemic had a negative impact on the global market for embedded security in IoT. While the pandemic accelerated the adoption of IoT devices in various industries, it also presented challenges for this market. One significant consequence of the pandemic was the disruption of the global supply chain, which affected the production and delivery of IoT devices, including those with embedded security features. Additionally, the increased number of people working from home during the pandemic created a higher demand for secure and reliable IoT devices, providing new opportunities for the embedded security for Internet of Things (IoT) market. Many companies had to adjust to remote work conditions and relied on IoT devices to improve productivity and connectivity. The pandemic also heightened the risk of cyberattacks, particularly on inadequately secured IoT devices, leading to a rise in demand for embedded security solutions to safeguard against cyber threats. However, the economic uncertainty caused by the pandemic resulted in budget constraints for many organizations, impacting their ability to invest in new IoT devices equipped with embedded security features.

Global Embedded Security For Internet of Things (IoT) Market- Drivers:

Increasing Number of Connected Devices via IoT Networks

The growing adoption of IoT worldwide has increased the number of devices being connected, exchanging data, and communicating with each other. These devices connected through IoT networks are used in several industry verticals including healthcare, retail, smart cities, industrial automation, agriculture, etc. For instance, On Jan 13, 2022, TSMC, a Taiwan-based semiconductor company, has increased its capital expenditure approximately $15 billion to $42–$44 billion in 2022.

Implementation of industry guidelines to adopt embedded hardware solutions

Since the cyber-attacks have been increased in the recent past significantly, numerous organizations that support the best practices for employing IoT solutions have issued guidelines for implementation and adoption of essential security solutions. Deploying embedded chipsets and embedded software is one such guideline to promote adoption of embedded security systems for IoT.

Global Embedded Security for Internet of Things (IoT) Market- Opportunities:

Limited Availability of High Computational Power for IoT Networks        

The scarcity of high computational power in IoT networks is expected to open up promising growth prospects for businesses operating in the market. Network security applications typically demand substantial power consumption, and utilizing lower-power embedded hardware can potentially jeopardize the overall system's integrity.

For instance, On April 2020, Intel Corporation, a technology and semiconductors manufacturing company introduced Xeon CPUs bundled with FPGA (field-programmable gate array) chips that can be programmed to adjust computational power according to specific applications and workloads. These chips offer a solution for equipping IoT devices with robust processing capabilities, effectively addressing the dearth of high computational power in IoT networks. This development presents market players with an opportunity to capitalize on the growing demand for enhanced computational performance in the IoT sector.

Unavailability Set-Up Mechanisms to Update Connected IoT Devices

IoT devices require constant upgrade, in order to protect against prevalent cyber-attacks and malware. However, such upgrades require support infrastructure from companies and technical expertise. Moreover, installing updated embedded chipsets reduce the need for updating these devices on regular basis, which in turn, is expected to provide excellent growth opportunity for embedded hardware solutions providers to endorse their products for IoT security.

Global Embedded Security for Internet of Things (IoT) Market- Trends:

Growing Focus on Component Aspect of Security

Software security solutions alone cannot prevent IoT devices against cyber-attacks and malwares. Thus, it needs to be supported by reliable hardware and for data processing and safe storage. Moreover, hardware components that susceptible to cyber-attacks provide an opportunity for unauthorized access and data theft, which is why, OEMs are shifting focus towards embedded component suppliers who can address these security issues.

Growing adoption of Industry 5.0 applications enabled by IoT, in order to become smart factory

‘Industry 5.0’ is a novel concept in the manufacturing industry where companies are adopting intelligent network, connected machines, systems, etc. in order to become smart factories. This will allow them to automatically monitor, exchange information, and instigate actions independently. Growing adoption of Industry 5.0 applications is expected to accelerate demand for embedded security solutions in the near future.

Global Embedded Security for Internet of Things (IoT) Market- Restraints:

Providing enhanced embedded security systems to growing IoT devices

Increasing number of connected IoT devices has increased the volume of data exchanged through these devices. Proving enhanced embedded security such large traffic of data without hampering the quality is a challenging task for service providers. Moreover, providing enhanced embedded security solutions to household devices connected through vast communications networks to industrial automation networks is a daunting task, which in turn, is expected to hinder the market growth over the forecast period.

Non-compliance to guidelines offered by regulatory authorities

Despite governing authorities issuing guidelines concerning IoT devices and their protection against cyber-attacks, many organizations and users are not stringently following these guidelines and taking precautionary measures. Such non-compliance to these guidelines results in security lapses, eventually leading to cyber-attacks. This, in turn, is expected to hamper the market growth over the forecast period.

Figure 2: Global Embedded Security for Internet of Things (IoT) Market Share (%), By Application, 2022

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Global Embedded Security for Internet of Things (IoT) Market- Segmentation:

Global Embedded Security for Internet of Things (IoT) Market report is segmented into component, application & end user.

By Component: Software, Controller Chip

By Application: Smart Factory, Smart Grid, Connected Car, Networking Equipment and Computing Devices.

By End User: Retail, Aerospace and Defense, Healthcare, Gaming, Automotive & Others.

In global embedded security for internet of things (IoT) market, by application segment connected car sub-segment dominated the global embedded security for internet of things (IoT) market in 2023, accounting for 33.0% share in terms of value.

The dominance of the connected car segment in the global embedded security for the Internet of Things (IoT) market can be attributed to several key factors. Firstly, the increasing adoption of connected car technologies has generated a greater demand for robust security measures, aimed at safeguarding vehicles against cyber threats. Secondly, connected cars gather and transmit sensitive data, including personal information and vehicle diagnostics, which heightens the importance of security considerations. Lastly, the integration of advanced features like telematics, infotainment systems, and autonomous driving capabilities further underscores the necessity for secure embedded systems. Consequently, the connected car segment has emerged as a formidable force, propelling the growth of embedded security solutions within the IoT market.

Global Embedded Security for Internet of Things (IoT) Market: Key Developments

Major market players are focusing on product launches in order to enhance their product portfolio. For instance,

For instance, in June 2022, NXP semiconductors launched a new security chip for IoT devices that is designed to protect against a wide range of threats. The chips is called EdgeLock SE050 SE

For instance, in May 2022, STMicroelectronics, a renowned company offering embedded and cyber security solutions, as well as a range of semiconductor products for the automotive and aerospace industries, has joined forces with Microsoft Corporation. This collaboration entails the integration of Microsoft Azure RTOS & IoT Middleware with ST's STM32U5 MCUs (microcontrollers), known for their ultra-low-power capabilities. The partnership also includes the provision of a trusted platform module, enhancing the security of the embedded architecture within IoT systems.

In May 2022, Advantech, a leading provider of automation and Internet of Things (IoT) technology solutions, has introduced its UNO Embedded Automation Computer platform. This newly released platform comes equipped with Canonical's Ubuntu Operating System (OS) pre-installed, offering enhanced security and edge capabilities specifically tailored for IoT systems.

In November 2021, STMicroelectronics, a provider of embedded and cyber security services, has introduced its latest secure microcontroller designed for BSoC (biometric system-on-card) and dCVV (dynamic card verification) solutions. This advanced offering enhances the security of various banking and finance-related services. The microcontroller incorporates additional connectivity and energy harvesting circuitry specifically designed for biometric and dCVV systems.

Global Embedded Security for Internet of Things (IoT) Market: Key Companies Insights

Major players operating in the global Embedded Security For Internet of Things (IoT) market include Intel Corporation, Trend Micro Incorporated, Cisco System Inc., Inside Secure, NXP Semiconductors N.V., Synopsys, Inc., Infineon Technologies AG, ARM Holdings Plc. (SoftBank Corp), Gemalto NV, Palo Alto Networks Inc., Check Point Software Technologies Ltd., and others

*Definition: Embedded security is a strategic approach to protecting software running in embedded systems from attack. Embedded security for devices and networks that are connected through internet of things is provided with the help of hardware and software such as controller chip and others.